Learn Trading
Evergreen trading education organized by topic. Each answer is a self-contained explainer linked to the AlphaScala calculator or dataset that goes with it — how the mechanism actually works, what it costs you when it goes wrong, and where to check the current numbers. No fluff, no paid courses.
119 explainers across 8 topics. Written and reviewed under our editorial policy.
Order types, execution, position sizing, mechanics
Equities, earnings, dividends, valuation basics
Day trading, swing trading, investing, approach selection
Currency pairs, leverage, carry trades, macro drivers
Bitcoin, altcoins, on-chain signals, custody
Stop losses, diversification, capital preservation
Gold, oil, agricultural products, supply and demand
S&P 500, NASDAQ, futures, index investing
Trading Basics
34 answersWhat is scalping in trading
Scalping is a fast trading style holding positions seconds to minutes for small profits. Learn how it works, key terms, and risks.
What is copy trading
Copy trading automatically mirrors another trader's positions. Learn how it works, hidden fees, leverage risks, and a checklist before you start.
What are support and resistance levels
Learn what support and resistance are, how to identify them, and how to trade them. Includes a worked example, risk context, and practical tips.
What is fundamental analysis
Learn how fundamental analysis values stocks, currencies, and assets using financial statements, ratios, and economic data. Includes examples and risk context.
What is swing trading vs day trading
Swing trading holds positions for days. Day trading opens and closes in one session. Learn the differences in time, risk, and capital requirements.
What is technical analysis in trading
Technical analysis uses price and volume data to forecast market moves. Learn core concepts, example trades, and risk management for beginners.
What is the difference between forex and stocks
Forex trades currency pairs with high leverage 24/5. Stocks trade company shares on exchanges. Learn the differences in hours, liquidity, costs, and risk.
What are CFDs and how do they work
CFDs let traders bet on price moves without owning the asset. This guide covers margin, leverage, costs, short selling, and key risks.
What is a spread in trading
A spread is the difference between two prices. Learn how bid-ask, forex pips, options strategies, and spread betting work. With costs and risk explained.
What is margin trading
Margin trading means borrowing from a broker to buy more. Learn how leverage works, what a margin call is, and the real risks for beginners.
How to read a candlestick chart
Learn how to read candlestick charts. Understand bodies, wicks, open, high, low, close. Practical examples and risk context for beginners.
What is leverage in trading and how does it work
Leverage in trading is borrowed capital that multiplies gains and losses. Learn how margin, ratios, and liquidation work with real examples.
What is the difference between ECN and market maker brokers
ECN brokers match orders directly with other traders. Market makers take the opposite side. Learn the differences in spreads, costs, and conflicts of interest.
What is wash sale rule in trading
The wash sale rule disallows tax deductions on losses if you repurchase the same security within 30 days. Learn how it works with an example.
How are trading profits taxed
Learn how trading profits are taxed as capital gains or income. Includes examples, key rules, and risk warnings for traders.
What is a moving average and how to use it
Learn what a moving average is, how to calculate SMA and EMA, and how to use crossovers, support/resistance, and trend identification in trading with ri...
What is slippage in trading
Slippage in trading is the gap between expected and executed price. Learn causes, see a worked example, and how to manage it with limit orders.
What is a bull market vs bear market
Learn the difference between a bull and bear market, including 20% thresholds, investor psychology, strategies, and risk management for traders.
What is dollar cost averaging
Dollar cost averaging is an investment strategy of buying a fixed dollar amount of an asset at regular intervals. Learn how DCA lowers average cost with...
What is the bid ask spread
The bid-ask spread is the difference between the highest buy price and lowest sell price. Learn how it works as a transaction cost with a worked example.
What is slippage and how to avoid it
Slippage is the difference between expected and executed trade price. Learn causes, types, and practical strategies to minimize slippage in forex, stock...
What is an OCO order
Learn what an OCO order is, how it works, and when to use it to manage risk and lock in profits. Includes a worked example and checklist.
What is a trailing stop order
A trailing stop order is a dynamic stop-loss that adjusts with price. Learn how it works, see a worked example, and understand risks in volatile markets.
What is a stop limit order
A stop limit order is a conditional trade instruction that combines a trigger price (the stop) with a maximum or minimum acceptable execution price (the...
What is divergence in trading
Learn what divergence in trading is, including regular and hidden bullish and bearish divergence. Understand how to spot it using RSI and MACD, and why...
What are chart timeframes in trading
Chart timeframes define the interval for each price bar. Learn how 1-min, 5-min, daily, and weekly charts affect signals, noise, and risk in trading.
What is Bollinger Bands indicator
Bollinger Bands are a technical analysis indicator that measures market volatility and identifies potential overbought or oversold price levels. Created...
What is volume in trading and why it matters
Learn what volume in trading means, why it matters for confirming trends and breakouts, and how to use volume indicators with a practical example and ri...
What is a head and shoulders pattern
A head and shoulders pattern is a bearish reversal chart formation that signals the likely end of an uptrend and the start of a downtrend. It appears as...
What is a double top and double bottom pattern
Learn how double top and double bottom chart patterns signal trend reversals. Covers identification, neckline breaks, volume confirmation, targets, and...
What are Fibonacci retracement levels
Learn what Fibonacci retracement levels are, how to draw them, key ratios, and how traders use them to spot support and resistance. Includes practical e...
What is MACD and how to use it
Learn what the MACD indicator is, how it's calculated, and how to use signal line crossovers, divergence, and the histogram to identify trends and momen...
What is the RSI indicator
Learn what the RSI indicator is, how it's calculated, and how to use it for overbought/oversold signals, divergence, and trend confirmation. Includes a...
What is a market order vs limit order
Learn the difference between market and limit orders, with a worked example, risk considerations, and when to use each. Essential for traders.
Stocks
17 answersHow does inflation affect stock prices
Learn how inflation impacts stocks through discount rates, margins, and sector effects. Includes a worked example and risk context for traders.
How to start trading stocks as a beginner
Step by step guide for beginners: open a brokerage account, buy an index fund, avoid leverage, and manage risk. Start with $50 or less.
What is an IPO and how to invest in one
Learn what an IPO is, how public offerings work, how retail investors can participate, and the main risks before buying IPO shares.
What is the Nasdaq 100
The Nasdaq 100 tracks 100 largest non-financial companies on Nasdaq. Learn how it works, its top holdings, weighting, and ways to trade it.
What is earnings season and why it matters
Earnings season is the quarterly 4-6 week window when public companies report financial results, triggering stock repricing and volatility. Learn how it...
What is a stock market index
A stock market index tracks a group of stocks to measure a market segment. Learn how indices work, weighting methods, and why they matter for investors.
What is a blue chip stock
A blue chip stock is a share of a large, stable, and financially strong company with a history of reliable earnings. Learn key traits, examples, and risks.
What is a hedge fund
Learn what a hedge fund is, how it works, common strategies like long/short equity, the 2 and 20 fee model, risks, and who can invest. A clear beginner'...
What is insider trading
Insider trading is buying or selling a security using material, non-public information. Learn the difference between legal and illegal insider trading,...
What is a stock buyback
A stock buyback is when a company repurchases its own shares, reducing outstanding shares to boost EPS. Learn how buybacks work with an example and key...
What is short selling
Short selling is a strategy to profit from a stock's decline by selling borrowed shares and repurchasing them cheaper. Learn the mechanics, costs, and r...
What is P/E ratio and how to use it
Learn what P/E ratio means, how to calculate trailing and forward P/E, and when a low or high P/E signals value or risk. Practical examples included.
What is market capitalization
Market capitalization is the total dollar value of a company's outstanding shares. Learn the formula, size categories, and how to use market cap in inve...
What is a stock split
A stock split increases shares and lowers the price per share without changing total value. Learn how splits work, reverse splits, and the risks for tra...
What is a dividend and how does it work
Learn what a dividend is, how dividend payments work, key dates, yield calculation, and risks for stock investors. A clear guide with examples.
What is an ETF and how does it work
An ETF is a pooled investment fund that trades on an exchange like a stock. Learn how ETFs work, their types, costs, liquidity, and key risks for beginn...
What is the S&P 500 index
The S&P 500 tracks 500 large US companies. Learn how it's calculated, why market-cap weighting matters, and how to invest via ETFs and futures.
Strategy
16 answersHow long does it take to become a profitable trader
Becoming a profitable trader takes 1-3 years on average. Learn the timeline, key phases, risk factors, and a worked example of the path to profitability.
Why do most retail traders lose money
Learn why 70-90% of retail traders lose money due to lack of edge, poor risk management, overleverage, and emotions. Includes examples and risk context.
What is FOMO in trading and how to avoid it
Learn what FOMO (fear of missing out) is in trading, how it causes losses, and actionable strategies to avoid it with examples and a checklist.
How to control emotions while trading
Learn how to control emotions while trading with a trading plan, position sizing, stop losses, and a trading journal. Reduce fear and greed.
What is arbitrage in trading
Arbitrage is the simultaneous buying and selling of an asset in different markets to profit from price differences. Learn how it works, types, risks, an...
What is position trading
Position trading is a long-term investment strategy where traders hold financial assets for extended periods, typically ranging from several weeks to mu...
How to backtest a trading strategy
Learn how to backtest a trading strategy with historical data, key metrics, a worked example, and a checklist to avoid overfitting and survivorship bias.
How to build a trading strategy from scratch
Learn how to build a trading strategy from scratch with a step-by-step guide covering entry rules, position sizing, backtesting, and risk management for...
What is pairs trading and how does it work
Pairs trading is a market-neutral strategy that buys one asset and shorts another correlated asset to profit from spread convergence. Learn how it works...
What is a breakout trading strategy
Learn what a breakout trading strategy is, how to identify real breakouts with volume, and manage risk. Includes a practical example and checklist.
What is algorithmic trading
Algorithmic trading is the use of computer programs to execute trades automatically based on a defined set of rules for timing, price, and quantity. The...
What is trend following in trading
Trend following is a trading strategy that aims to profit from sustained price moves in one direction. Instead of predicting reversals or valuing assets...
What is mean reversion trading
Mean reversion trading bets that prices return to their average. Learn how it works, key indicators, a practical example, and risks like trend breaks.
What is value investing vs growth investing
Learn the core differences between value and growth investing, with examples, risk notes, and a practical checklist for beginner stock investors.
What is momentum trading
Learn what momentum trading is, how it works, key indicators like RSI and MACD, a practical example, and essential risk management for stocks, forex, an...
What is the difference between investing and trading
Learn the core differences between investing and trading, including time horizon, risk, analysis methods, and tax treatment. Includes a practical worked...
Forex
13 answersWhat are forex trading sessions
Learn what forex trading sessions are, when they open, and how they affect liquidity, spreads, and risk. Includes session times, overlap periods, and a practical checklist.
How to choose a forex broker
Learn how to pick a forex broker: regulation, spreads, platform, and execution. A beginner's guide with checklist and risk warnings.
How do central banks affect forex markets
Central banks move forex markets through interest rates, forward guidance, and direct intervention. Learn how rate decisions, QT, and QE sway currency pairs.
Best time to trade EUR/USD
Learn the best time to trade EUR/USD. London-New York overlap from 1:00 p.m. GMT offers tightest spreads and highest liquidity.
What is a pip in forex trading
Learn what a pip is in forex trading, how to calculate pip value, and why it matters for risk management. Includes examples and formula.
What is forex trading and how does it work
Forex trading explained: how currency pairs work, leverage risks, and what beginners need to know before trading the $7.5 trillion daily market.
Do I need a license to trade forex
Learn if you need a license to trade forex as a retail trader. Country-specific rules, when a license is required, and risk factors explained.
What is interest rate parity
Interest rate parity (IRP) is a fundamental financial theory stating that the interest rate differential between two countries should equal the differen...
Why does the US dollar affect everything
The US dollar's role as the world's reserve currency means its movements ripple through commodities, debt, and central bank policies. Learn how it impac...
What is a pip value and how to calculate it
A pip value is the monetary worth of a single pip movement in a currency pair, expressed in the account's base currency. It directly translates price ch...
What is correlation between currency pairs
Learn how currency pair correlation measures the relationship between forex pairs, from -1 to +1. Use it to manage risk and avoid overexposure in your t...
What is a carry trade in forex
A forex carry trade borrows a low-interest currency to buy a high-yielding one, profiting from the interest rate differential. Learn how it works, risks...
What are major minor and exotic currency pairs
Learn the differences between major, minor, and exotic forex pairs, including spreads, volatility, and risk. A beginner-friendly guide with examples.
Crypto
13 answersHow to trade cryptocurrency safely
Learn how to trade crypto safely with position sizing, stop-losses, hardware wallets, and no leverage. A practical guide for beginners.
What is DeFi and decentralized finance
DeFi is a blockchain-based financial system without banks. Learn how smart contracts, DEXs, and lending work, plus the risks you must know.
How does cryptocurrency mining work
Learn how crypto mining works: proof of work, ASIC hardware, mining pools, block rewards, and the real costs and risks involved.
Difference between Bitcoin and Ethereum
Bitcoin is digital gold for savings. Ethereum is a platform for apps and smart contracts. Compare use cases, risks, and which suits a beginner.
What is Bitcoin and how does it work
Bitcoin is a digital currency that runs on blockchain technology. Learn how mining, wallets, keys, and transactions work. Includes risk warnings for beginners.
What is a stablecoin
A stablecoin is a cryptocurrency pegged to a stable asset like the US dollar. Learn how fiat-backed, crypto-backed, and algorithmic stablecoins maintain...
What is market cap in crypto
Market cap in crypto is the total value of a cryptocurrency, calculated as price × circulating supply. Learn how to use it, its limitations, and risks.
What is an NFT
An NFT is a unique blockchain token proving ownership of a digital asset. Learn how NFTs work, their uses, risks, and a practical buying scenario.
What is a smart contract
Smart contracts are self-executing programs on a blockchain that automate agreements. Learn how they work, with examples, risks, and a security checklist.
What is proof of stake vs proof of work
Proof of Stake vs Proof of Work: learn how these consensus mechanisms validate blockchain transactions, their energy use, security models, and staking r...
What is the difference between a CEX and DEX
Learn the difference between centralized (CEX) and decentralized (DEX
What is staking in crypto
Staking locks crypto in a proof-of-stake network to earn rewards. Learn how staking works, yields, lock-up periods, slashing risks, and liquid staking o...
What is a crypto wallet and how to use one
A crypto wallet stores private keys to manage digital assets. Learn how to set up, send, and secure your wallet with this beginner's guide.
Risk Management
13 answersHow to calculate risk reward ratio
Learn how to calculate the risk reward ratio with a simple formula, examples, and a practical checklist for beginners.
What is position sizing in trading
Learn what position sizing means in trading, why it matters, and how to calculate the right trade size using a simple formula.
How to manage risk in trading
Learn how to manage risk in trading with position sizing, stop losses, risk-reward ratios, and leverage control. Includes a practical example for beginners.
What is a stop loss order
A stop loss order closes a trade automatically at a set price to cap losses. Learn how stop market and stop limit orders work, and how to set them correctly.
What is a trailing stop loss
A trailing stop loss adjusts automatically as price moves in your favor, locking in gains while capping risk. Learn how it works, with examples and key...
What is a trading plan and why do you need one
A trading plan is a written rulebook for entries, exits, and risk. Learn why it's essential to remove emotion, control losses, and trade consistently.
How to handle a losing streak
Learn how to manage a losing streak with risk limits, circuit breakers, and journal reviews. Protect capital and avoid revenge trading.
What is hedging in trading
Hedging in trading is a risk management strategy that uses offsetting positions to protect against losses. Learn how it works with examples and key risks.
How to avoid overtrading
Learn how to avoid overtrading with a rules-based system, daily trade limits, and risk controls. Practical guide for beginners with examples and a check...
What is the 1 percent rule in trading
The 1 percent rule limits risk per trade to 1% of account equity. Learn how to calculate position size, protect capital, and avoid common mistakes.
How to set a take profit level
Learn how to set a take profit level using risk-reward ratios, technical analysis, and volatility. Step-by-step guide with example and checklist for tra...
What is portfolio diversification
Learn how portfolio diversification reduces risk by spreading investments across asset classes, sectors, and geographies. Includes practical example and...
How much capital should I risk per trade
Learn the 1-2% risk rule for trading. Calculate position size, avoid ruin, and manage risk with our step-by-step guide, examples, and checklist.
Commodities
8 answersWhat is crude oil trading
Learn how crude oil trading works, from futures and spot markets to key price drivers and risks. A clear guide for beginners.
What affects gold prices
Learn the main factors that move gold prices: real interest rates, the dollar, geopolitical risk, and central bank demand. Practical insights for traders.
What drives agricultural commodity prices
Learn what drives agricultural commodity prices: supply, demand, weather, policies, and more. Includes examples and risk context for traders.
What is a futures contract
Learn what a futures contract is, how it works, key components, risks, and a worked example. Understand margin, mark to market, and uses for hedging or speculation.
Why do people invest in silver
Discover why people invest in silver: store of value, industrial demand, inflation hedge, and portfolio diversification. Understand risks and benefits.
What is the difference between WTI and Brent crude
Learn the differences between WTI and Brent crude oil, including quality, delivery points, pricing, and trading risks.
How does OPEC affect oil prices
Learn how OPEC influences crude oil prices through production quotas, spare capacity, and coordinated cuts. Includes a trading checklist and risk context.
What is natural gas trading
Learn what natural gas trading is, how Henry Hub futures work, key instruments, the weekly data cycle, and risk management for this volatile commodity m...
Indices
5 answersHow to invest in an index
Learn how to invest in an index using low-cost index funds and ETFs. Step-by-step guide, examples, risks, and key terms explained for beginners.
What is the VIX index
Understand the VIX index, the market's fear gauge. Learn how it is calculated, what it means, and how to trade VIX futures and options safely with risk management.
How is the S&P 500 weighted
The S&P 500 uses float-adjusted market cap weighting. Learn the formula, quarterly rebalancing, concentration risks, and how it affects index fund investors.
What is the Russell 2000 index
Learn what the Russell 2000 index is, how it tracks small-cap US stocks, its annual rebalancing, market cap weighting, and key risks for traders.
What is the Dow Jones Industrial Average
The Dow Jones Industrial Average (DJIA) is a price-weighted index of 30 large US stocks. Learn how it works, its calculation, and risks.
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