Trading mentorship terms
Plain definitions for the language used across this guide. Where a term has a test behind it, the entry points to the page that develops it.
The terms, defined
Trading mentor
A teacher who shows you how they think about markets and risk, with the goal of you learning to trade a method yourself rather than copying tips indefinitely.
Systematic method
A documented, rule-based way of trading that can be written down, learned and repeated, as opposed to discretionary calls that live only in one person's head. See: how to choose a mentor.
Mean reversion
Trading on a price that has stretched unusually far from a typical level and tends to snap back toward it; the four models apply this idea on different clocks.
Verified record
A real-money trading history that a named outside party has checked, rather than results the mentor reports about themselves. See: a verified record.
Conviction grade
An A-to-D label marking how strong a call is relative to its own model's measured return spread; there is no E grade. See: grades you can read.
Cryptographic timestamp
A hash of a call written to a public ledger at the moment it is made, proving it existed in exactly that form at that time and was not edited afterward. See: proof over promises.
Drawdown
The deepest peak-to-trough fall over a period - a more honest read on a trader's risk than the headline return, and a number a serious mentor will show you. See: how to verify a record.
Sharpe ratio
A measure of return earned per unit of risk taken; higher is better, and it stops a big return from impressing you until you know how much risk produced it.
Single-model plan
Following one of the four models on its own, so a student can learn one clock at a time rather than paying for the whole book before they are ready.