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Orders, Execution & Market Structure

Trade-for-Trade Segment

A settlement category in which every trade must be settled by delivery, with intraday squaring-off prohibited.

Test: buy and sell quantities in the security cannot be netted within the day; each trade settles individually by delivery qualitative Market Basics & Instruments

Trader

A market participant who buys and sells to profit from price movement over short horizons rather than from the underlying business.

Test: the entry and exit decisions rest on price, volume and positioning, with a horizon measured in minutes to months qualitative Market Basics & Instruments

Trading Account

The account with a broker through which buy and sell orders are placed on an exchange.

Test: the account is opened with a trading member of an exchange and is used to route orders, not to hold securities qualitative Market Psychology & Behavioural Finance

Trading Psychology

The emotional and cognitive discipline required to follow a plan under uncertainty and financial pressure.

Test: decisions taken under pressure match the rules set in advance, rather than being renegotiated in the moment qualitative Fundamental Analysis & Valuation

Trailing Price-to-Earnings

The price-to-earnings ratio computed using earnings actually reported over the last twelve months.

Trailing P/E = Current Market Price / Earnings per Share over the Trailing Twelve Months ratio (x, times) Orders, Execution & Market Structure

Trailing Stop-Loss

A stop-loss whose trigger price follows a favourable move at a fixed distance and never moves back.

For a long position: Trigger = Highest Price Since Entry - Trail Amount qualitative Orders, Execution & Market Structure

Transaction Cost

The full cost of trading a security, comprising explicit charges and the implicit costs of spread and market impact.

Total Cost = Brokerage + STT + Exchange Fees + SEBI Fees + Stamp Duty + GST + Spread + Impact Cost % Bonds & Fixed Income

Treasury Bill

A short-term government security issued at a discount to face value and redeemed at par, with no coupon.

Yield = [(Face Value - Price) / Price] x (365 / Days to Maturity) x 100 % Technical Analysis & Chart Patterns

Trend

A sustained directional tendency in price, described as up, down or sideways over a stated timeframe.

Uptrend: successively higher highs and higher lows; Downtrend: successively lower highs and lower lows qualitative Technical Analysis & Chart Patterns

Trend Following

A rules-based approach that enters in the direction of an established price move and exits when that move ends.

Test: entry and exit are determined by a stated trend rule, with no forecast of turning points and no valuation input qualitative Technical Analysis & Chart Patterns

Trendline

A straight line drawn to connect successive swing lows in a rise or successive swing highs in a fall.

Test: the line touches at least two swing points and is confirmed by a third touch without being violated between them qualitative Risk & Portfolio Management

Treynor Ratio

Return above the risk-free rate per unit of systematic risk, measured by beta.

Treynor Ratio = (Portfolio Return - Risk-Free Rate) / Portfolio Beta ratio (x, times) Technical Analysis & Chart Patterns

Triple Bottom

Three troughs at approximately the same price level separated by two peaks.

Test: three lows within a small percentage of each other, with the highest intervening peak acting as the completion level qualitative Technical Analysis & Chart Patterns

Triple Top

Three peaks at approximately the same price level separated by two troughs.

Test: three highs within a small percentage of each other, with the lowest intervening trough acting as the completion level qualitative Indicators & Oscillators

TRIX

The percentage rate of change of a triple-smoothed exponential moving average of price.

TRIX = Percentage change of EMA(EMA(EMA(Close, n), n), n) % Market Basics & Instruments

Turnover

The rupee value of trading in a security over a period, obtained by multiplying each trade's quantity by its price.

Turnover = Sum of (Trade Quantity x Trade Price) over the period ₹ crore