Glossary — TOTH

The desk uses trading vocabulary and a few words of its own. Here is all of it in plain language. If you find something on the site that isn't explained here, that's our mistake — tell us and we'll add it.

Before any of it: the market itself

If you've traded before, skip this section — it's here so nobody has to pretend they already know.

Sharealso: stock, equity: A piece of a company you can own. Owning one makes you a part owner of the actual business. Its price is simply whatever the last buyer agreed to pay, which is why a company can be doing well while its share price does nothing for a year.
Index: A basket of companies tracked as one number, so “the market went up” can mean something specific. You can't buy an index — it's a calculation, not a company — but you can buy things whose price follows it.
S&P 500: Roughly the 500 largest public companies in the United States, combined into a single number, weighted so bigger companies count for more. It is the index this desk's systems trade, through futures rather than directly.
Optionalso: call, put: A contract giving the right — not the obligation — to buy (a call) or sell (a put) at a set price before a set date. TOTH does not trade options. They're defined here because you will hear about them constantly and because their main trap is worth knowing: they lose value as the deadline approaches, so you can be right about direction and still lose everything by being right too slowly.
Leverage: Controlling something worth far more than the cash you put up. One micro S&P contract tracks about $25,000 of index while your broker asks for a few hundred dollars to hold it. Leverage doesn't improve a trade, it enlarges it in both directions, and it is the reason futures accounts get emptied by people who picked the right direction with too large a position.
Long and short: Long means you own it and profit if the price rises. Short means you sold something you don't own and profit if it falls. In futures, selling is as ordinary as buying — no borrowing, no special permission.

Things that stop a trade

Learn these four first. They're the ones you'll need in a hurry.

Flatten: Close every open position immediately, at whatever price the market is offering. It is the emergency brake, and it is always available to you directly at your broker. Flattening at the broker works even if TOTH, PickMyTrade, and your internet connection are all having a bad day, which is exactly why we tell you to learn where that button is before you need it.
Flat: Owning nothing. No position, no exposure, nothing that can move against you overnight. “The session ends flat” means the system closed out before the day finished.
Close-only exit: An exit order that can only reduce your position toward zero. It can never accidentally flip you from long to short. Every exit TOTH relays is stamped close-only on our server regardless of what the incoming signal says, because the failure it prevents (a wrong-way position opened by a garbled exit) is one of the more expensive ways an automated system can hurt you.
Pause: Stops new orders reaching your account. Read that carefully: it stops all orders, including the exit on a position you already have open. Pausing mid-trade means the system can no longer close that trade for you. If you want out of a live position, flatten at your broker first and pause afterwards.

The instruments

Futures contract: An agreement to buy or sell something at a set price on a set date. In practice nobody involved wants the something; the contract is bought and sold for the price movement. They are leveraged, which is why a small move produces a large gain or loss relative to what you put up.
ES and MESalso: E-mini and Micro E-mini S&P 500: The two contracts TOTH trades. Both track the S&P 500. ES moves $50 per point and MES moves $5 per point, so MES is the same trade at one tenth the size. Start on MES. There is no prize for trading a bigger contract than you're ready for.
Point and tick: A point is one full unit of price. A tick is the smallest move the contract makes, which is 0.25 points on ES and MES. So one tick is $12.50 on ES and $1.25 on MES. Backtest results are usually quoted in points because points are size-independent; multiply by $5 or $50 to get dollars.
Margin: The cash your broker requires you to hold to keep a position open. Overnight margin is usually much higher than intraday margin. This matters here because several of the desk's hands hold positions overnight — The Double Down is built on it — and a seat playing one needs the higher figure.
Rolloveralso: the roll: Futures contracts expire. Every quarter, trading moves to the next one and the symbol changes. It's routine, it's scheduled, and it is a moment where an automated system can end up pointed at the wrong contract if nobody is watching.

Measuring what happened

Round tripalso: a completed trade: One entry and its matching exit, counted as a single trade. We count round trips rather than orders because two orders make one decision, and it is the decision you want to judge.
Hand: House slang for one of the desk's trading systems — The Coil, The Double Down, and so on. Each hand also carries a small fixed wire name (TOTH One, TOTH Eight) that the ledger, alerts, and support conversations use — the table name can change, the wire name never does. The card metaphor runs through the whole product: a signal is dealt, a trade is a hand, the desk is the house. Nothing more technical than that.
Win rate: The share of round trips that closed green. It is the most quoted and least useful number in trading, because you can set it almost anywhere you like by moving your profit target. Take profit early enough and you'll win 70% of trades while losing money overall. Never read a win rate without reading the profit factor beside it.
Profit factor: Gross winnings divided by gross losses. Above 1.0 means the winners paid for the losers. This is the number a win rate is meaningless without, and it is the one most people selling you something will leave out.
Drawdown: How far the account fell from its highest point before recovering — the worst stretch, measured peak to trough. It is the number that decides whether you can actually run a system, because it describes the loss you have to sit through to reach the eventual gain. Ask for it every time somebody shows you a return.
R and R-multiple: R is the amount you risk on a trade — the distance to your stop. A 2R target aims to make twice what you're risking. A 0.75R target aims to make three quarters of it, which wins more often and pays less each time.
Slippage: The gap between the price you expected and the price you got. Always real, always against you on average, and the single biggest reason a backtest flatters a strategy. Our modeling assumes two ticks per side and we stress-test at three times that.
Backtest: Running a strategy over historical prices to see what it would have done. Useful, and the easiest thing in trading to fool yourself with: test enough variations and something will look brilliant purely by chance. Treat any backtest, including ours, as a reason to investigate rather than a reason to believe.

Around the desk

Simalso: simulated, paper trading: Trades recorded but never sent to a broker. No real money moves. Everyone at TOTH starts here and live routing stays locked until you have read and signed the risk disclosure.
Fuel: The desk's word for the account balance you're sizing against. It's what the sizing math divides up to work out how many contracts you can carry and what your maximum loss per trade comes to.
The tape: Live market activity as it happens. On the desk, THE TAPE is the strip showing scheduled events that move the market — rate decisions, inflation prints, contract rollovers — so nothing on the calendar surprises you.
Stop and target: The two exits set the moment a trade opens. The stop is the price at which the trade is closed for a loss; the target is where it's closed for a gain. Both go to the broker with the order, so they survive TOTH being unavailable.
Guardrail: A rule that stops a system trading regardless of what its signals say — a cap on trades per day, a daily loss limit, a stand-down after consecutive losses, a drawdown breaker. Good guardrails usually make a backtest slightly worse. That's the point: they're insurance against conditions the backtest never contained.
Session: One trading day. Equity index futures run nearly around the clock, from Sunday evening to Friday afternoon US Eastern time, with a short daily break.

Words we made up

House vocabulary. A trader of thirty years would not know these, because they only exist here — which is exactly why they need writing down.

The Floor: The chart screen. Live price for the contract you're trading, with any open position drawn onto it and a manual ticket for acting by hand. Named for a trading floor, and for the casino floor, in roughly equal measure.
The Stack: The risk screen, where you set what you're prepared to lose on one trade and see it translated into contracts. “Your stack” is the poker sense of the phrase: the chips in front of you, and how many hands they buy.
The Table: A view that runs several systems over the same history together and asks whether they lose money at the same time. Two systems that always fall together aren't two bets, they're one bet wearing two hats.
The Rack: The founder's view of every registered system side by side: what it was validated at, what the engine says now, and what it has actually done. The gap between the first and last column is the only number that matters on that screen.
The Debrief: The weekly review — what happened, the best and worst trades, whether the week was ordinary. Named after the conversation you have when the shift ends, not after a report.
Seat: One member's place at the desk. A seat can play more than one system at once, and each system a seat plays has its own account, contract and size.
Dealt / dealing: Assigning a system to your seat so its signals reach you. The desk deals hands; it doesn't “enable strategies”.
Stood down: A system taken out of service because the evidence stopped supporting it — as opposed to paused, which is temporary and expects to come back, or retired, which is permanent. Standing a hand down is normal here and gets published rather than quietly buried.
The ledger: The permanent record of every signal, fill and round trip on your seat. It does not reset, and losing stretches are not removed from it. Sim and live are kept in separate ledgers that never mix.
Backfill: Historical results imported into a ledger rather than produced by live signals. Always labelled, because a backfilled row and a row the system actually generated are not the same kind of evidence.
Relay status: What happened when a signal reached the broker: sim (recorded, nothing sent), sent (the order went), rejected (the broker refused it), skipped (nothing was attempted, usually because no connection is set up). Every signal gets one, including the ones that went nowhere.
Holdout: A stretch of history deliberately hidden from a strategy search, then used once at the end to check the result. Testing on data you already searched tells you how well something fits the past, which is not the same as whether it works.