Glossary / Terminology Definitions
All the terms and concepts used here on Gametheorytrades.com are gathered together here for your reference and understanding.
Ascending Trigger
This is a trigger type. The Ascending Trigger has several inputs:
- An Indicator (let us say Relative Strength Index - 3 periods - Moving Averaged 3 Periods)
- First Side: Below or Above (let us say Below)
- A value (let us say 0.2
- Second Side: Below or Above (let’s say Above)
- A value (let us say 0.5)
This type of trigger will activate under the following conditions. If the current price was “Below” (First Side) the first value, then rises “Above” (Second Side) the second value. This image below illustrates this. The vertical red lines are when this trigger would activate.
Buy Trigger
A Buy Trigger is a component of a Trading System that tells the System when to enter the market. Any trigger can be assigned to be a Buy Trigger in a Trading System.
Constant Crossover Trigger
This is a trigger type. The Constant Crossover Trigger has several inputs:
- An Indicator (let us say Advance Decline Non Cumulative Moving Average - 8 Periods - Moving Averaged 5 Periods)
- First Side: Below or Above (let us say Above)
- A value (let us say 0.2)
This type of trigger will activate under the following conditions. If the current price was “Above” (First Side) the value, then crosses the value. This image below illustrates this. The vertical red lines are when this trigger would activate.
Gaming Theory Percentage Exit (Double Down and Set Limit Sell)
This is a trigger type. The Gaming Theory Percentage Exit Trigger has several inputs:
- Loss Percentage (let us say 10%)
- Limit Sell Percentage (let us say 12%)
- Max Trades in Trade Grouping (let us say 4)
This type of trigger will produce two recommendations depending on price:
- If the current day closing price is 10% less than the last Buy price, buy double the volume last purchased.
- If the current day closing price is 12% greater than the last Buy price, set the new limit at 12% greater, if the price drops back to 12% above the last buy price then Sell. This continues until the close price drops through one of the limit thresholds
This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
This trigger will only make the number of recommendations set by the Max Trades value in this case 4. After 4 trades no more buying will occur. Only Limit sells.
Indicator Crossover Trigger
This is a trigger type. The Indicator Crossover Trigger has several inputs:
- A first Indicator (let us say Detrended Price Oscillator - 20 Periods)
- First Side: Below or Above (let us say Above)
- An second Indicator (let us say Relative Strength Index - 3 periods - Moving Averaged 13 Periods)
This type of trigger will activate under the following conditions. If the first indicator was “Above” (First Side) the value, then crosses the second indictor value. This image below illustrates this. The vertical red lines are when this trigger would activate.
Move Trigger
A Move Trigger is a component of a Trading System that tells the System when to make the next move: either Sell or Buy more. Any trigger can be assigned to be a Move Trigger in a Trading System.
Never Trigger
This is a trigger type. Just like the name says. If this is used it will never fire. Commonly used as a placeholder in a Panic Trigger so only the Move trigger will determine the outcome of the Trading System.
Package
As used on this site, a Package is a combination of:
- A Stock or Index Symbol
- A Trading System
A Package will generate trade predictions for a Symbol or Index daily. Performance and profitability analysis is performed at the Package level based on historic trade reccomendations.
Panic Trigger
A Panic Trigger is a component of a Trading System that tells the System when to exit a Trade Grouping, regardless of what the Move Trigger is recommending. Think of this as your emergency exit. Any trigger can be assigned to be a Panic Trigger in a Trading System.
Percentage Change Incrementing Exit
This is a trigger type. The Percentage Change Incrementing Exit Trigger has one input:
- Percentage: What percentage must the price rise in order to trigger. (let us say %10)
If the current day closing price is 10% greater than the last Buy price, set the new limit at 10% greater than that, if the price drops back to 10% above the last buy price then Sell. This continues until the close price drops through one of the limit thresholds.
This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
Percentage Change Exit
This is a trigger type. The Percentage Change Exit Trigger has several inputs:
- Direction: “Gone Up” or “Gone Down” (let us say “Gone Down”)
- A Percentage (let us say 10%)
This type of trigger will activate under the following conditions. If the current day close price has “Gone Down” lower than the previous Buy Price by 10%. This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
Price Change Incrementing Exit
This is a trigger type. The Price Change Incrementing Exit Trigger has one input:
- Dollar Value: What Dollar Value must the price rise in order to trigger. (let us say $5.00)
If the current day closing price is $5.00 greater than the last Buy price, set the new limit at $5.00 greater than that, if the price drops back to $5.00 above the last buy price then Sell. This continues until the close price drops through one of the limit thresholds.
This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
Price Change Exit
This is a trigger type. The Price Change Trigger has several inputs:
- Direction: “Gone Up” or “Gone Down” (let us say “Gone Up”)
- A Dollar Value (let us say $2.50)
This type of trigger will activate under the following conditions. If the current day close price has “Gone Up” greater than $2.50 more than the previous Buy Price. This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
Timed Exit
This is a trigger type. Timed Exit Trigger has one input:
This type of trigger will activate under the following conditions. If the current day is 30 trading days past the Buy date. This must be used as a Move or Panic trigger. Applying it as a Buy Trigger would make no sense.
Trading System
As used on this site, a Trading System is a collection if three Triggers that determine quantitative rules as to when to enter and exit Stock Trades. Packages have one of each of the following Triggers:
- Buy Trigger – Criteria for when to enter into a trade
- Move Trigger – Criteria for exiting a trade profitably, or further investing in a Stock
- Panic Trigger – Criteria for exiting a trade to preserve capital
Trade Grouping
A Trade Grouping is a set of trades that together have a higher probability of profitability than a single trade alone. Packages produce Trade Groupings determined by the Triggers selected. Gaming Theory based Move triggers will generate multiple Buy signals and thus create a Trade Grouping.
Trigger
A trigger is a quantitative rule that fires when a particular situation occurs during the analysis of a Stock’s performance. There are 9 trigger types each described seperatly in this glossary. They are
- Zone Trigger
- Ascending Trigger
- Indicator Crossover Trigger
- Constant Crossover Trigger
- Never Trigger
- Timed Exit
- Percentage Change Incrementing Exit
- Percentage Change Exit
- Price Change Incrementing Exit
- Price Change Exit
- Gaming Theory Percentage Exit (Double Down and Set Fixed Limit Sell)
Zone Trigger
This is a trigger type. The Zone Trigger has several inputs:
- An Indicator (let us say Williams Oscillator - 14 Periods)
- A low value (let us say 0.3)
- A high value (let us say 0.8)
This type of trigger will activate under the following conditions. If the current price was below the low value, then rises above the high value and then starts to decline. This image below illustrates this. The vertical red lines are when this trigger would activate.
