71 terms

Dictionary: H

Haircut: The discount applied to collateral's market value when calculating how much credit it supports, sized to cover potential price falls before the collateral could be sold.
Half Kelly: The common compromise of betting 50% of the Kelly-optimal stake, keeping most of the growth with far less drawdown.
Halt auction: The auction that restarts trading after a halt, letting the book rebuild and price gap in an orderly, single-price cross rather than in a chaotic race.
Halving: A scheduled event roughly every four years that cuts the reward paid to Bitcoin miners in half, slowing new supply.
Hammer: A candle with a small body near the top and a long lower shadow, appearing after a decline, suggesting buyers defended lower prices.
Handle: The whole-number part of a futures price, used as shorthand when traders talk about levels.
Hanging man: The same shape as a hammer but appearing after an advance, hinting that selling pressure appeared even though buyers closed it back up.
Harami: A small candle whose body sits entirely inside the previous, much larger candle's body, signalling that momentum has paused.
Harami cross: A harami where the inside candle is a doji, making the pause in momentum as pronounced as it can be.
Hard fork: A protocol change that makes previously invalid blocks valid, so every node must upgrade or be left on a separate chain.
Hard red winter wheat futures (KE): The higher-protein wheat contract originally from the Kansas City Board of Trade, now listed on CME, traded against Chicago soft red winter wheat as a protein spread.
Hard stop: A stop order actually resting at the broker, so the exit happens whether or not you are watching the screen.
Hard to borrow: A stock with limited lendable supply, where a short seller must obtain a specific locate, pay an elevated and volatile fee, and accept the risk of being recalled.
Hardware wallet: A dedicated device that stores private keys in a chip and signs transactions internally, so keys never reach your computer.
Hash: A one-way fingerprint of data: the same input always gives the same short output, and any change gives a completely different one.
Hash rate: The total computing power guessing at a proof-of-work chain's puzzle, usually quoted in hashes per second.
Hash ribbons: An indicator comparing a 30-day and 60-day moving average of hash rate, used to flag miner capitulation and its end.
Hawkish and dovish: Shorthand for policy bias: hawkish means leaning toward tighter policy to fight inflation, dovish means leaning toward easier policy to support employment.
Head and shoulders: A reversal pattern with three peaks, the middle one highest, and a neckline connecting the two troughs between them.
Health factor: A single number summarising how close a borrowing position is to liquidation, where 1.0 is the threshold and higher is safer.
Heartbeat monitoring: A regular signal confirming that each component is alive and current. Silence is the alert, which catches the failures that error handling misses.
Heating oil futures (ULSD): NYMEX contracts on 42,000 gallons of ultra-low sulphur distillate delivered in New York Harbor — the benchmark for diesel, jet fuel and heating oil worldwide.
Hedge: A position taken to offset the risk of another position, giving up some upside to reduce downside.
Hedge fund: A privately offered pooled vehicle, usually a limited partnership, that faces few portfolio restrictions and charges a management fee plus a share of profits.
Hedge ratio: The number of futures contracts needed to offset a given cash exposure, adjusted for size, volatility and the correlation between the two.
Hedger: A market participant who uses futures to offset a price risk they already carry in the physical world, accepting a known price instead of an unknown one.
Hedging mode account: An account type that allows simultaneous long and short positions in the same instrument, each held as a separate ticket with its own entry, stop and result.
Heikin-Ashi: A candle variant that averages current and prior prices to smooth a chart into longer runs of one colour, at the cost of showing real prices.
Held order: An order the broker must attempt to execute immediately at the best available price, with no discretion to wait for a better one.
Henry Hub: The Louisiana pipeline interchange that is the delivery point for NYMEX natural gas futures and the reference price for North American gas.
Herding: Copying what the crowd is doing because the crowd is doing it, rather than because your own process says to.
Hesitation: Failing to take a setup that meets every criterion, usually after a recent loss, so the strategy runs without its best trades.
Heteroskedasticity: Non-constant error variance. In markets it is the normal state of affairs, because volatility itself changes over time.
Hidden divergence: A divergence read as trend continuation rather than reversal: price makes a higher low while the oscillator makes a lower low.
Hidden order: A resting limit order that does not appear in the public order book at all; it is only discovered when someone trades against it.
High volume node: A price on a volume profile where an unusually large amount of trading occurred, marking an area of agreement that tends to slow price down.
High wave candle: A candle with a small body and unusually long shadows on both sides, indicating volatility without direction.
High yield (junk bonds): Bonds rated BB plus or Ba1 and below, carrying meaningful default risk and paying a wide spread over governments to compensate for it.
High-frequency trading (HFT): Automated trading characterised by very short holding periods, very high message rates, minimal overnight risk and profit-per-trade measured in fractions of a cent.
High-water mark: The peak value an investor's stake has previously reached, above which the manager must climb again before earning another performance fee.
Higher highs and higher lows: The structural definition of an uptrend: each swing high and swing low exceeds the previous one.
Higher timeframe: A longer chart interval used for context; its levels and trend tend to dominate shorter-term signals.
Hindsight bias: The feeling, after the fact, that an outcome was obvious and predictable, which makes past trades look like clear mistakes or easy wins.
Historical VaR: Value at risk estimated by re-running today's portfolio through actual past returns and reading the relevant percentile.
HMRC: The UK tax authority responsible for capital gains tax, income tax, stamp duty on share purchases, and the treatment of spread betting and ISA wrappers.
HODL: Crypto slang for holding through volatility rather than selling, originating from a misspelled forum post in 2013.
HODL waves: A chart banding the total supply by how long each coin has been unmoved, showing whether holdings are ageing or turning over.
Holding period: The length of time an asset is owned, which determines whether a gain is short or long term and whether preferential rates or discounts apply. Concept used in most jurisdictions.
Holdout set: A block of data locked away at the start of research and opened only once, at the end, as a final sanity check.
Holiday liquidity: The reduced depth in the order book around public holidays, year-end and the quiet hours between sessions, which widens spreads and exaggerates the size of ordinary moves.
Honeypot token: A token whose contract lets you buy but blocks or taxes selling, so the chart looks healthy while every holder is trapped.
Hope as a strategy: Holding a position because you want it to come back, after the reason for holding it has gone.
Hopium: Hope as an intoxicant; holding a failing position on optimism with no supporting evidence.
Hostile takeover: An acquisition attempt made directly to shareholders after the target's board refuses, usually through a tender offer or a proxy fight.
Hot wallet: A wallet whose keys sit on an internet-connected device, convenient for daily use and permanently exposed to malware.
Hot-hand fallacy: Believing a streak of wins means the next trade is more likely to win, so you size up at the worst possible moment.
Hotkeys: Keyboard bindings that fire a fully specified order in one keystroke, trading configuration effort now for execution speed later.
House margin requirement: A broker's own margin rules, set stricter than the regulatory minimum, often raised for volatile, concentrated or illiquid positions without warning.
House money effect: Taking bigger risks with recent profits because they feel like the casino's money rather than your own.
House requirement: A broker's own margin requirement, set above the exchange minimum for its own protection.
Household survey: The monthly survey of about 60,000 households that produces the unemployment rate, participation rate and household employment; noisy month to month but conceptually broad.
Housing starts and building permits: Monthly counts of new residential units begun and of permits issued; permits lead starts, and both are among the most rate-sensitive series in the economy.
Hull moving average: A smoothing that combines weighted moving averages to cut lag sharply while keeping the line smooth, at the cost of overshooting turns.
Humped yield curve: A curve that rises to a peak in the intermediate maturities and then falls, so mid-curve yields sit above both short and long ones.
Hunt brothers silver corner (1979-1980): The attempt by Nelson and William Hunt to corner the silver market, which drove silver from about $6 to $50 an ounce before exchange rule changes collapsed it to $11 in days.
Hurdle rate: A minimum return that must be achieved before a performance fee is payable, so the manager is paid only for results above a reference rate.
Hurst exponent: A single number summarising whether a series trends, reverts, or wanders. Above 0.5 suggests persistence, below 0.5 suggests reversion, 0.5 is a random walk.
Hybrid book: A broker that sorts clients between internal and external execution, hedging some flow and keeping the rest, based on profitability and risk models.
Hyperbolic discounting: Valuing an immediate reward far above a larger one later, which is why a small profit now beats letting a winner run.
Hyperparameter: A setting that governs how a model is fitted rather than being learned from the data: tree depth, penalty strength, learning rate, number of neighbours.
Hypothetical performance disclaimer: The prescribed warning that must accompany simulated or backtested trading results in US futures marketing, explaining that hypothetical results have inherent limitations and benefit from hindsight.

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