# Financial glossary for traders

> Plain-English definitions of the SEC filings, FDA milestones, corporate actions, options, short selling and market structure terms behind market-moving news.

Source: https://www.quantisnow.com/glossary

## SEC filings

- [8-K Item 1.01: Entry into a Material Definitive Agreement](https://www.quantisnow.com/glossary/8-k-item-1-01.md): The 8-K item a company uses to disclose that it signed a material agreement outside the ordinary course of business, such as a merger or credit deal.
- [8-K Item 1.02: Termination of a Material Definitive Agreement](https://www.quantisnow.com/glossary/8-k-item-1-02.md): The 8-K item a company uses to disclose that a material agreement was terminated, other than by expiring on its stated terms.
- [8-K Item 1.03: Bankruptcy or Receivership](https://www.quantisnow.com/glossary/8-k-item-1-03.md): The 8-K item a company files to disclose a bankruptcy filing, receivership, or similar proceeding involving the company or its parent.
- [8-K Item 1.05: Material Cybersecurity Incidents](https://www.quantisnow.com/glossary/8-k-item-1-05.md): The 8-K item a company files within four business days of determining that a cybersecurity incident is material.
- [8-K Item 2.01: Completion of Acquisition or Disposition of Assets](https://www.quantisnow.com/glossary/8-k-item-2-01.md): The 8-K item a company files when it closes the purchase or sale of a significant amount of assets, including a business.
- [8-K Item 2.02: Results of Operations and Financial Condition](https://www.quantisnow.com/glossary/8-k-item-2-02.md): The 8-K item a company uses to furnish an earnings release or other public announcement of results for a completed period.
- [8-K Item 2.03: Creation of a Direct Financial Obligation](https://www.quantisnow.com/glossary/8-k-item-2-03.md): The 8-K item a company files when it takes on a material direct financial obligation, such as a loan or bond, or an off-balance sheet obligation.
- [8-K Item 2.05: Costs Associated with Exit or Disposal Activities](https://www.quantisnow.com/glossary/8-k-item-2-05.md): The 8-K item a company files when it commits to a restructuring, such as layoffs or closures, that will cause material charges under GAAP.
- [8-K Item 2.06: Material Impairments](https://www.quantisnow.com/glossary/8-k-item-2-06.md): The 8-K item a company files when it concludes that a material impairment charge to its assets, such as goodwill, is required under GAAP.
- [8-K Item 3.01: Notice of Delisting or Failure to Satisfy a Listing Rule](https://www.quantisnow.com/glossary/8-k-item-3-01.md): The 8-K item a company files after an exchange notifies it that it no longer meets a listing standard, or when it moves or ends its listing.
- [8-K Item 3.02: Unregistered Sales of Equity Securities](https://www.quantisnow.com/glossary/8-k-item-3-02.md): The 8-K item a company files when it sells equity securities in a private, unregistered deal above certain size thresholds.
- [8-K Item 4.01: Changes in Registrant's Certifying Accountant](https://www.quantisnow.com/glossary/8-k-item-4-01.md): The 8-K item a company files when its independent auditor resigns, declines to stand for reappointment, or is dismissed, or a new one is engaged.
- [8-K Item 4.02: Non-Reliance on Previously Issued Financial Statements](https://www.quantisnow.com/glossary/8-k-item-4-02.md): The 8-K item a company files when its previously issued financial statements should no longer be relied on because of an error, signaling a restatement.
- [8-K Item 5.02: Departure or Appointment of Directors and Officers](https://www.quantisnow.com/glossary/8-k-item-5-02.md): The 8-K item a company files when a director or key executive leaves or is appointed, or when it adopts or changes material executive pay arrangements.
- [8-K Item 5.07: Submission of Matters to a Vote of Security Holders](https://www.quantisnow.com/glossary/8-k-item-5-07.md): The 8-K item a company files to report the results of shareholder votes, usually within four business days after its annual or special meeting.
- [8-K Item 7.01: Regulation FD Disclosure](https://www.quantisnow.com/glossary/8-k-item-7-01.md): The 8-K item a company uses to furnish information publicly under Regulation FD, such as investor presentations or updated guidance.
- [8-K Item 8.01: Other Events](https://www.quantisnow.com/glossary/8-k-item-8-01.md): The catch-all 8-K item companies use to voluntarily report events they consider important to shareholders that no other item requires.
- [DEF 14A (proxy statement)](https://www.quantisnow.com/glossary/def-14a.md): The definitive proxy statement a public company files before a shareholder meeting, covering board elections, executive pay and other voting items.
- [EDGAR](https://www.quantisnow.com/glossary/edgar.md): The SEC's electronic system where public companies, insiders and funds submit filings and where anyone can read them for free.
- [Form 10-K](https://www.quantisnow.com/glossary/form-10-k.md): The audited annual report US public companies file with the SEC, covering the business, risk factors, MD&A and full financial statements.
- [Form 10-Q](https://www.quantisnow.com/glossary/form-10-q.md): The quarterly report US public companies file with the SEC for each of the first three fiscal quarters, with unaudited financial statements and MD&A.
- [Form 15](https://www.quantisnow.com/glossary/form-15.md): The SEC filing a company uses to terminate registration of a class of securities or suspend its periodic reporting obligations.
- [Form 20-F](https://www.quantisnow.com/glossary/form-20-f.md): The annual report foreign private issuers file with the SEC, roughly equivalent to a 10-K, due within four months of fiscal year-end.
- [Form 25](https://www.quantisnow.com/glossary/form-25.md): The SEC filing that removes a class of securities from listing on a national exchange, made by either the exchange or the company.
- [Form 424B prospectus](https://www.quantisnow.com/glossary/form-424b.md): A prospectus filed with the SEC under Rule 424(b), typically the final pricing terms of an IPO or a takedown from a shelf registration.
- [Form 6-K](https://www.quantisnow.com/glossary/form-6-k.md): The SEC form foreign private issuers use to furnish material information they publish at home, such as earnings releases and major announcements.
- [Form 8-K](https://www.quantisnow.com/glossary/form-8-k.md): The SEC "current report" a public company files to disclose material events, generally within four business days of the event.
- [Form D](https://www.quantisnow.com/glossary/form-d.md): The SEC notice a company files after first selling securities in an exempt private offering under Regulation D, disclosing the amount raised.
- [Form F-1](https://www.quantisnow.com/glossary/form-f-1.md): The SEC registration statement foreign private issuers use for an IPO or other securities offering in the US, the foreign counterpart to Form S-1.
- [Form NT 10-K (notification of late filing)](https://www.quantisnow.com/glossary/form-nt-10-k.md): The SEC notice a company files when it cannot submit its 10-K on time, giving it a 15-calendar-day grace period under Rule 12b-25.
- [Form S-1](https://www.quantisnow.com/glossary/form-s-1.md): The SEC registration statement US companies use for an IPO or other securities offering when they cannot use a shorter form such as the S-3.
- [Form S-3](https://www.quantisnow.com/glossary/form-s-3.md): The short-form SEC registration statement seasoned public companies use to register securities, most often for shelf offerings.
- [Form S-4](https://www.quantisnow.com/glossary/form-s-4.md): The SEC registration statement used to register securities issued in mergers, acquisitions and exchange offers, often combined with a proxy statement.
- [Form S-8](https://www.quantisnow.com/glossary/form-s-8.md): The SEC registration statement companies use to register shares issued to employees and directors under stock option and equity compensation plans.
- [MD&A (Management's Discussion and Analysis)](https://www.quantisnow.com/glossary/mdna.md): The section of a 10-K or 10-Q where management explains results, trends, liquidity and capital resources in its own words.
- [Regulation FD](https://www.quantisnow.com/glossary/regulation-fd.md): The SEC rule that bars public companies from selectively disclosing material nonpublic information to analysts or investors before the public.
- [Schedule TO](https://www.quantisnow.com/glossary/schedule-to.md): The SEC filing made by a company or bidder launching a tender offer for a public company's securities, disclosing the offer's terms.

## Insiders and ownership

- [Activist investor](https://www.quantisnow.com/glossary/activist-investor.md): An investor who buys a meaningful stake in a public company to push for changes such as a sale, board seats, buybacks or new management.
- [Beneficial owner](https://www.quantisnow.com/glossary/beneficial-owner.md): A person who has or shares voting or investment power over a security, directly or indirectly, even if the shares are held in another name.
- [Blackout period](https://www.quantisnow.com/glossary/blackout-period.md): A window around quarter end and earnings when a company's insider trading policy bars officers, directors and some employees from trading its stock.
- [Form 13F](https://www.quantisnow.com/glossary/form-13f.md): A quarterly SEC report of US equity holdings by investment managers with $100 million or more in 13(f) securities, due 45 days after quarter end.
- [Form 144](https://www.quantisnow.com/glossary/form-144.md): A notice filed with the SEC when an affiliate or holder of restricted stock plans to sell shares under Rule 144 above set size thresholds.
- [Form 3](https://www.quantisnow.com/glossary/form-3.md): The initial SEC statement of beneficial ownership filed by a company's officers, directors and 10% holders when they first become insiders.
- [Form 4](https://www.quantisnow.com/glossary/form-4.md): The SEC filing that reports a change in an insider's holdings, such as a purchase, sale, option exercise or grant, generally within two business days.
- [Form 5](https://www.quantisnow.com/glossary/form-5.md): An annual SEC filing where insiders report exempt or small transactions that were not already disclosed on Form 4, due 45 days after fiscal year end.
- [Insider buying](https://www.quantisnow.com/glossary/insider-buying.md): Purchases of a company's stock by its officers, directors or 10% holders, reported to the SEC on Form 4 and watched as a signal of insider confidence.
- [Institutional ownership](https://www.quantisnow.com/glossary/institutional-ownership.md): The share of a company's stock held by institutions such as mutual funds, pensions, hedge funds and banks, usually estimated from 13F filings.
- [Rule 10b5-1 trading plan](https://www.quantisnow.com/glossary/rule-10b5-1-plan.md): A prearranged written plan that lets insiders buy or sell stock on a set schedule, providing an affirmative defense against insider trading claims.
- [Schedule 13D](https://www.quantisnow.com/glossary/schedule-13d.md): The SEC disclosure an investor must file after acquiring more than 5% of a company's voting stock with an active intent, such as seeking change.
- [Schedule 13G](https://www.quantisnow.com/glossary/schedule-13g.md): A short-form SEC disclosure for investors who own more than 5% of a company's voting stock but hold it passively, without intent to influence control.

## Earnings and fundamentals

- [Consensus estimate](https://www.quantisnow.com/glossary/consensus-estimate.md): The average or median of sell-side analysts' forecasts for a company's earnings, revenue or other metric for a given period.
- [Earnings call](https://www.quantisnow.com/glossary/earnings-call.md): A conference call or webcast where company management discusses quarterly results and guidance and takes questions from analysts.
- [Earnings per share (EPS)](https://www.quantisnow.com/glossary/earnings-per-share.md): A company's net income available to common shareholders divided by its weighted average shares outstanding, reported as basic and diluted figures.
- [Earnings surprise (beat or miss)](https://www.quantisnow.com/glossary/earnings-surprise.md): The difference between a company's reported earnings and the analyst consensus estimate, described as a beat when above and a miss when below.
- [EBITDA](https://www.quantisnow.com/glossary/ebitda.md): Earnings before interest, taxes, depreciation and amortization, a common proxy for operating profit before financing and non-cash charges.
- [Free cash flow](https://www.quantisnow.com/glossary/free-cash-flow.md): The cash a company generates from operations after capital expenditures, available for debt repayment, dividends, buybacks or acquisitions.
- [Going concern warning](https://www.quantisnow.com/glossary/going-concern.md): A disclosure, by management or the auditor, that there is substantial doubt about a company's ability to keep operating for the next year.
- [Guidance](https://www.quantisnow.com/glossary/guidance.md): A company's own forecast of future results, such as revenue, EPS or margins for the next quarter or year, usually issued with earnings.
- [Market capitalization](https://www.quantisnow.com/glossary/market-capitalization.md): The total market value of a company's outstanding shares, calculated as the share price multiplied by the number of shares outstanding.
- [Non-GAAP earnings](https://www.quantisnow.com/glossary/non-gaap.md): Earnings figures adjusted by a company to exclude items such as stock compensation, amortization or one-time charges, which must be reconciled to GAAP.
- [Preannouncement](https://www.quantisnow.com/glossary/preannouncement.md): An early release of preliminary results or a guidance change before a company's scheduled earnings report, either positive or negative.
- [Price-to-earnings ratio (P/E)](https://www.quantisnow.com/glossary/pe-ratio.md): A valuation multiple equal to a stock's share price divided by its earnings per share, showing how much investors pay for each dollar of profit.
- [Public float](https://www.quantisnow.com/glossary/public-float.md): The portion of a company's outstanding shares held by non-affiliates, excluding stock owned by officers, directors and controlling holders.
- [Shares outstanding](https://www.quantisnow.com/glossary/shares-outstanding.md): The total number of a company's shares currently held by all shareholders, including insiders and institutions, excluding treasury shares.
- [Whisper number](https://www.quantisnow.com/glossary/whisper-number.md): An unofficial earnings expectation, often higher than the published consensus, that reflects what traders believe a company will actually report.

## Dividends

- [Declaration date](https://www.quantisnow.com/glossary/declaration-date.md): The date a company's board announces a dividend, setting its amount, ex-dividend date, record date and payment date.
- [Dividend](https://www.quantisnow.com/glossary/dividend.md): A distribution of a company's profits or cash to shareholders, usually paid in cash on a regular schedule after being declared by the board.
- [Dividend cut](https://www.quantisnow.com/glossary/dividend-cut.md): A reduction or suspension of a company's regular dividend by its board, usually to preserve cash when earnings or cash flow weaken.
- [Dividend reinvestment plan (DRIP)](https://www.quantisnow.com/glossary/drip.md): A program that automatically uses an investor's cash dividends to buy more shares of the same stock, often including fractional shares.
- [Dividend yield](https://www.quantisnow.com/glossary/dividend-yield.md): A stock's annual dividend per share divided by its current share price, expressed as a percentage of the price.
- [Ex-dividend date](https://www.quantisnow.com/glossary/ex-dividend-date.md): The first trading day on which a stock trades without the right to its next dividend; buyers on or after this date do not receive it.
- [Payment date](https://www.quantisnow.com/glossary/payment-date.md): The date a company actually pays a declared dividend to eligible shareholders, usually days or weeks after the record date.
- [Payout ratio](https://www.quantisnow.com/glossary/payout-ratio.md): The share of a company's earnings paid out as dividends, calculated as dividends per share divided by earnings per share.
- [Record date](https://www.quantisnow.com/glossary/record-date.md): The date a company uses to determine which shareholders are entitled to a dividend or other distribution, or to vote at a meeting.
- [Special dividend](https://www.quantisnow.com/glossary/special-dividend.md): A one-time dividend paid outside a company's regular schedule, often after an asset sale, a windfall or a buildup of excess cash.

## Corporate actions

- [Chapter 11 bankruptcy](https://www.quantisnow.com/glossary/chapter-11.md): A US bankruptcy process that lets a company keep operating while it restructures its debts under court supervision through a plan of reorganization.
- [Chapter 7 bankruptcy](https://www.quantisnow.com/glossary/chapter-7.md): A US bankruptcy process in which a company stops operating and a court-appointed trustee sells its assets to repay creditors in priority order.
- [Delisting](https://www.quantisnow.com/glossary/delisting.md): The removal of a company's stock from a national exchange, either voluntarily or because it failed listing standards, often leaving it to trade OTC.
- [Going-private transaction](https://www.quantisnow.com/glossary/going-private.md): A deal in which a public company's shares are bought out, often by private equity, insiders or a controlling holder, and the stock stops trading.
- [Poison pill (shareholder rights plan)](https://www.quantisnow.com/glossary/poison-pill.md): A takeover defense that lets existing holders buy discounted shares if an investor crosses an ownership threshold, diluting the would-be acquirer.
- [Reverse stock split](https://www.quantisnow.com/glossary/reverse-stock-split.md): A corporate action that combines existing shares into fewer shares at a higher price, often used to regain compliance with exchange minimum bid rules.
- [Rights offering](https://www.quantisnow.com/glossary/rights-offering.md): A capital raise in which a company gives existing shareholders the right to buy new shares, usually at a discount, in proportion to their holdings.
- [Share buyback](https://www.quantisnow.com/glossary/share-buyback.md): A company's repurchase of its own shares from the market or directly from holders, reducing shares outstanding and returning cash to investors.
- [Spin-off](https://www.quantisnow.com/glossary/spin-off.md): A corporate action in which a company separates a business unit into a new, independently traded company and distributes its shares to existing holders.
- [Stock split](https://www.quantisnow.com/glossary/stock-split.md): A corporate action that increases a company's share count by a fixed ratio and cuts the per-share price proportionally, leaving market value unchanged.
- [Tender offer](https://www.quantisnow.com/glossary/tender-offer.md): A public offer to buy shares directly from a company's stockholders at a fixed price or price range, usually at a premium and for a limited time.
- [Ticker change](https://www.quantisnow.com/glossary/ticker-change.md): A change to the symbol under which a company's stock trades, usually tied to a rebrand, merger, exchange move or corporate restructuring.

## Mergers and acquisitions

- [De-SPAC](https://www.quantisnow.com/glossary/de-spac.md): The merger in which a SPAC combines with a private operating company, turning that company into a publicly traded business.
- [Deal spread](https://www.quantisnow.com/glossary/deal-spread.md): The gap between an acquisition target's market price and the value of the offer, reflecting the market's view of closing risk and time.
- [Go-shop period](https://www.quantisnow.com/glossary/go-shop.md): A window after a merger agreement is signed during which the target may actively solicit competing bids, usually with a reduced break-up fee.
- [Hostile takeover](https://www.quantisnow.com/glossary/hostile-takeover.md): An attempt to acquire a company against the wishes of its board, typically through a tender offer directly to shareholders or a proxy fight.
- [Letter of intent](https://www.quantisnow.com/glossary/letter-of-intent.md): A largely non-binding document setting out the main terms of a proposed deal, such as price and structure, before a definitive agreement is negotiated.
- [Merger agreement](https://www.quantisnow.com/glossary/merger-agreement.md): The binding contract between an acquirer and a target that sets the deal price, structure, closing conditions and termination rights of an acquisition.
- [Merger arbitrage](https://www.quantisnow.com/glossary/merger-arbitrage.md): A strategy that buys the stock of an acquisition target after a deal is announced to capture the gap between its market price and the offer price.
- [Reverse merger](https://www.quantisnow.com/glossary/reverse-merger.md): A transaction in which a private company becomes public by merging into an existing public company, bypassing a traditional IPO.
- [SPAC (special purpose acquisition company)](https://www.quantisnow.com/glossary/spac.md): A shell company that raises cash in an IPO and places it in trust to acquire a private company, which becomes public through the merger.
- [Termination fee (break-up fee)](https://www.quantisnow.com/glossary/termination-fee.md): A payment one party to a merger agreement owes the other if the deal is terminated for specified reasons, such as accepting a better offer.

## IPOs and offerings

- [At-the-market (ATM) offering](https://www.quantisnow.com/glossary/at-the-market-offering.md): A way for a public company to sell new shares gradually into the open market at prevailing prices through a sales agent, off a shelf registration.
- [Convertible notes](https://www.quantisnow.com/glossary/convertible-notes.md): Debt securities that pay interest and can be converted into a set number of the issuer's shares, usually at a premium to the share price at issue.
- [Dilution](https://www.quantisnow.com/glossary/dilution.md): The reduction in existing shareholders' ownership percentage and per-share claims on earnings when a company issues new shares.
- [Direct listing](https://www.quantisnow.com/glossary/direct-listing.md): A way to go public by listing existing shares on an exchange without an underwritten IPO, with the opening price set by the market.
- [Follow-on offering](https://www.quantisnow.com/glossary/follow-on-offering.md): A sale of additional shares by a company that is already public, used to raise more capital or let existing holders sell stock.
- [Greenshoe option (over-allotment)](https://www.quantisnow.com/glossary/greenshoe-option.md): An underwriter's option to sell up to 15% more shares than planned in an offering, used to stabilize the price after trading begins.
- [Initial public offering (IPO)](https://www.quantisnow.com/glossary/ipo.md): The first sale of a private company's shares to the public, after which the stock lists and trades on an exchange such as Nasdaq or the NYSE.
- [IPO pricing](https://www.quantisnow.com/glossary/ipo-pricing.md): The process by which a company and its underwriters set the final per-share price and size of an IPO, usually the evening before trading begins.
- [Lock-up period](https://www.quantisnow.com/glossary/lock-up-period.md): A contractual window after an IPO or offering, commonly 180 days, during which insiders and early investors agree not to sell their shares.
- [PIPE (private investment in public equity)](https://www.quantisnow.com/glossary/pipe.md): A private sale of a public company's stock or convertible securities to selected investors, usually at a discount, registered for resale later.
- [Quiet period](https://www.quantisnow.com/glossary/quiet-period.md): A stretch when a company or its underwriters limit public communication, most often around an IPO or in the weeks before an earnings release.
- [Registered direct offering](https://www.quantisnow.com/glossary/registered-direct-offering.md): A sale of shelf-registered shares directly to a small group of pre-selected investors through a placement agent, often at a discount and with warrants.
- [Secondary offering](https://www.quantisnow.com/glossary/secondary-offering.md): A sale of a public company's shares by existing holders such as founders or private equity, with proceeds going to the sellers, not the company.
- [Shelf registration](https://www.quantisnow.com/glossary/shelf-registration.md): An SEC registration that lets a company register securities in advance and sell them over time, typically up to three years, as market conditions allow.
- [Underwriter](https://www.quantisnow.com/glossary/underwriter.md): An investment bank that manages a securities offering, buys the shares from the issuer and resells them to investors, earning a fee called the spread.
- [Warrants](https://www.quantisnow.com/glossary/warrants.md): Securities issued by a company that give the holder the right to buy its shares at a set exercise price before a set expiration date.

## Analyst ratings

- [Analyst downgrade](https://www.quantisnow.com/glossary/analyst-downgrade.md): A sell-side analyst's move to a less favorable rating on a stock, such as from Buy to Hold, usually published with a lower price target and rationale.
- [Analyst upgrade](https://www.quantisnow.com/glossary/analyst-upgrade.md): A sell-side analyst's move to a more favorable rating on a stock, such as from Hold to Buy, usually published with a new price target and thesis.
- [Buy rating](https://www.quantisnow.com/glossary/buy-rating.md): An analyst recommendation that a stock is expected to outperform or deliver meaningful positive returns over the rating horizon, usually 12 months.
- [Hold rating](https://www.quantisnow.com/glossary/hold-rating.md): A neutral analyst recommendation that a stock is expected to perform roughly in line with the market or its sector, without a clear reason to buy or sell.
- [Initiation of coverage](https://www.quantisnow.com/glossary/initiation-of-coverage.md): The first research report an analyst or brokerage publishes on a company, setting an opening rating and price target.
- [Outperform rating](https://www.quantisnow.com/glossary/outperform.md): An analyst rating meaning a stock is expected to deliver better returns than its sector, the market or the analyst's coverage universe; similar to Buy.
- [Overweight rating](https://www.quantisnow.com/glossary/overweight.md): An analyst rating meaning a stock is expected to beat its sector or benchmark, so investors should hold more of it than its index weight; similar to Buy.
- [Price target](https://www.quantisnow.com/glossary/price-target.md): An analyst's estimate of where a stock will trade at a future point, usually 12 months out, used with a rating to show expected upside or downside.
- [Reiterated rating](https://www.quantisnow.com/glossary/reiterated-rating.md): An analyst note confirming an existing rating on a stock without changing it, often issued after earnings or news and sometimes with a new price target.
- [Sell rating](https://www.quantisnow.com/glossary/sell-rating.md): An analyst recommendation that a stock is expected to underperform or decline, the rarest of the standard ratings on Wall Street.
- [Sell-side analyst](https://www.quantisnow.com/glossary/sell-side-analyst.md): A research analyst at a brokerage or investment bank who publishes ratings, price targets and earnings estimates on stocks for the firm's clients.
- [Underweight rating](https://www.quantisnow.com/glossary/underweight.md): An analyst rating meaning a stock is expected to lag its sector or benchmark, so investors should hold less of it than its index weight; similar to Sell.

## Biotech and FDA

- [510(k) clearance](https://www.quantisnow.com/glossary/510k-clearance.md): FDA clearance to market a medical device shown to be substantially equivalent to a legally marketed device already on the market.
- [Abbreviated New Drug Application (ANDA)](https://www.quantisnow.com/glossary/anda.md): The FDA application used to approve a generic drug by showing it is bioequivalent to an already approved brand-name drug.
- [Accelerated approval](https://www.quantisnow.com/glossary/accelerated-approval.md): An FDA pathway approving drugs for serious conditions based on a surrogate endpoint, with confirmatory trials required to verify clinical benefit.
- [Biologics License Application (BLA)](https://www.quantisnow.com/glossary/bla.md): The application a company submits to the FDA to market a biologic, such as an antibody, vaccine or gene therapy, in the United States.
- [Breakthrough therapy designation](https://www.quantisnow.com/glossary/breakthrough-therapy.md): An FDA designation that speeds development of a drug for a serious condition when early clinical data show substantial improvement over existing therapy.
- [Complete response letter (CRL)](https://www.quantisnow.com/glossary/complete-response-letter.md): A letter from the FDA stating it cannot approve a drug or biologic application in its current form and explaining the deficiencies to fix.
- [Fast track designation](https://www.quantisnow.com/glossary/fast-track.md): An FDA designation that speeds development of drugs for serious conditions with unmet need, adding FDA contact and rolling review of the application.
- [FDA advisory committee (AdCom)](https://www.quantisnow.com/glossary/advisory-committee.md): A panel of outside experts that reviews a drug or device application in a public meeting and votes on questions such as whether benefits outweigh risks.
- [Investigational New Drug application (IND)](https://www.quantisnow.com/glossary/ind.md): The FDA filing a sponsor must have in effect before testing an unapproved drug or biologic in humans in the United States.
- [New Drug Application (NDA)](https://www.quantisnow.com/glossary/nda.md): The formal application a drugmaker submits to the FDA requesting approval to market a new small-molecule drug in the United States.
- [Orphan drug designation](https://www.quantisnow.com/glossary/orphan-drug-designation.md): An FDA status for drugs treating rare diseases affecting fewer than 200,000 people in the US, bringing incentives such as 7 years of market exclusivity.
- [PDUFA date](https://www.quantisnow.com/glossary/pdufa-date.md): The target date by which the FDA aims to approve or reject a new drug or biologic application under the Prescription Drug User Fee Act.
- [Phase 1 clinical trial](https://www.quantisnow.com/glossary/phase-1-trial.md): The first stage of human testing for a new drug, focused on safety, tolerability, dosing and how the body processes it, usually in a small group.
- [Phase 2 clinical trial](https://www.quantisnow.com/glossary/phase-2-trial.md): The mid-stage of drug testing in patients, designed to show early evidence that a drug works, refine the dose and further assess safety.
- [Phase 3 clinical trial](https://www.quantisnow.com/glossary/phase-3-trial.md): The large, late-stage trial that tests whether a drug works and is safe in a broad patient population, usually forming the basis for an FDA application.
- [Premarket approval (PMA)](https://www.quantisnow.com/glossary/pma.md): The FDA's most rigorous review pathway for high-risk Class III medical devices, requiring scientific evidence of safety and effectiveness.
- [Primary endpoint](https://www.quantisnow.com/glossary/primary-endpoint.md): The main outcome a clinical trial is designed and statistically powered to measure, used to judge whether the drug worked.
- [Priority review](https://www.quantisnow.com/glossary/priority-review.md): An FDA designation that shortens the review goal for a drug application to 6 months instead of the standard 10 months.
- [REMS (Risk Evaluation and Mitigation Strategy)](https://www.quantisnow.com/glossary/rems.md): A safety program the FDA can require for a drug with serious risks, ranging from a medication guide to restricted prescribing and distribution.
- [Supplemental NDA (sNDA)](https://www.quantisnow.com/glossary/snda.md): An application to change an already approved drug's NDA, most often to add a new indication, patient population, dose or formulation.
- [Topline data](https://www.quantisnow.com/glossary/topline-data.md): The first high-level results from a clinical trial, usually covering the primary endpoint and key safety findings, released before the full dataset.

## Options

- [0DTE options](https://www.quantisnow.com/glossary/zero-dte.md): Options traded on the same day they expire, most commonly on the S&P 500 index (SPX) and major index ETFs such as SPY and QQQ.
- [At the money (ATM)](https://www.quantisnow.com/glossary/at-the-money.md): Describes an option whose strike price equals or sits very close to the current price of the underlying stock.
- [Call option](https://www.quantisnow.com/glossary/call-option.md): A contract giving the buyer the right, but not the obligation, to buy a stock at a set price on or before a set date.
- [Covered call](https://www.quantisnow.com/glossary/covered-call.md): An options strategy where an investor who owns at least 100 shares sells a call against them to collect premium, capping upside above the strike.
- [Delta](https://www.quantisnow.com/glossary/delta.md): How much an option's price is expected to change for a $1 move in the underlying stock, from 0 to 1 for calls and 0 to -1 for puts.
- [Expiration date](https://www.quantisnow.com/glossary/expiration-date.md): The last day an options contract can be traded or exercised, after which it either settles or expires worthless.
- [Gamma](https://www.quantisnow.com/glossary/gamma.md): The rate at which an option's delta changes for each $1 move in the underlying stock, highest for at-the-money options near expiration.
- [Implied volatility (IV)](https://www.quantisnow.com/glossary/implied-volatility.md): The market's forecast of how much a stock will move, expressed as an annualized percentage and backed out of current option prices.
- [In the money (ITM)](https://www.quantisnow.com/glossary/in-the-money.md): Describes an option with intrinsic value: a call whose strike is below the stock price, or a put whose strike is above it.
- [IV crush](https://www.quantisnow.com/glossary/iv-crush.md): The sharp drop in implied volatility, and in option prices, that typically follows a scheduled event like earnings or an FDA decision.
- [Open interest](https://www.quantisnow.com/glossary/open-interest.md): The total number of options contracts for a given strike and expiration that are still open and have not been closed, exercised or expired.
- [Option premium](https://www.quantisnow.com/glossary/option-premium.md): The price an options buyer pays the seller for a contract, made up of intrinsic value plus time value.
- [Options chain](https://www.quantisnow.com/glossary/options-chain.md): A table listing every available call and put for a stock, organized by expiration date and strike, with prices, volume and open interest.
- [Options volume](https://www.quantisnow.com/glossary/options-volume.md): The number of options contracts traded during a session, for a single strike, an expiration or all of a stock's options combined.
- [Out of the money (OTM)](https://www.quantisnow.com/glossary/out-of-the-money.md): Describes an option with no intrinsic value: a call whose strike is above the stock price, or a put whose strike is below it.
- [Put option](https://www.quantisnow.com/glossary/put-option.md): A contract giving the buyer the right, but not the obligation, to sell a stock at a set price on or before a set date.
- [Put/call ratio](https://www.quantisnow.com/glossary/put-call-ratio.md): Put options volume (or open interest) divided by call options volume, used as a gauge of bearish versus bullish positioning.
- [Strike price](https://www.quantisnow.com/glossary/strike-price.md): The fixed price at which an option holder can buy (call) or sell (put) the underlying stock if the option is exercised.
- [Theta](https://www.quantisnow.com/glossary/theta.md): The estimated amount an option loses in value each day from the passage of time, with all other factors held constant.
- [Unusual options activity](https://www.quantisnow.com/glossary/unusual-options-activity.md): Options trading far above a contract's normal volume or open interest, often in short-dated strikes, that may signal positioning ahead of news.
- [Vega](https://www.quantisnow.com/glossary/vega.md): How much an option's price is expected to change for each one-percentage-point change in implied volatility.

## Short selling

- [Borrow fee](https://www.quantisnow.com/glossary/borrow-fee.md): The annualized interest rate a short seller pays to borrow shares, charged daily and rising sharply when shares are scarce.
- [Days to cover (short interest ratio)](https://www.quantisnow.com/glossary/days-to-cover.md): Short interest divided by average daily trading volume, estimating how many days it would take short sellers to buy back all their shares.
- [Failure to deliver (FTD)](https://www.quantisnow.com/glossary/failure-to-deliver.md): A trade in which the seller does not deliver the shares to the buyer by the settlement date, currently one business day after the trade (T+1).
- [Hard to borrow](https://www.quantisnow.com/glossary/hard-to-borrow.md): A stock with little lendable supply relative to short-selling demand, which brings high borrow fees and possible limits on new short sales.
- [Naked short selling](https://www.quantisnow.com/glossary/naked-short-selling.md): Selling shares short without first borrowing them or arranging to borrow them, which can leave the buyer without delivery at settlement.
- [Regulation SHO](https://www.quantisnow.com/glossary/regulation-sho.md): The SEC rule set governing US short sales, covering order marking, the locate requirement, close-outs of failed trades and the alternative uptick rule.
- [Short interest](https://www.quantisnow.com/glossary/short-interest.md): The total number of a company's shares that have been sold short and not yet covered, reported by brokers to FINRA twice a month.
- [Short sale restriction (alternative uptick rule)](https://www.quantisnow.com/glossary/short-sale-restriction.md): A rule that, after a stock drops 10% or more from the prior close, lets short sales execute only above the national best bid for that day and the next.
- [Short seller report](https://www.quantisnow.com/glossary/short-seller-report.md): A public research report from an investor who is short a stock, alleging problems such as fraud, accounting issues or overvaluation.
- [Short selling](https://www.quantisnow.com/glossary/short-selling.md): Selling borrowed shares in the hope of buying them back later at a lower price, profiting from a decline in the stock.
- [Short squeeze](https://www.quantisnow.com/glossary/short-squeeze.md): A rapid price rise driven by short sellers buying back shares to limit losses, which pushes the price higher and forces more covering.
- [Short volume](https://www.quantisnow.com/glossary/short-volume.md): The number of shares sold short during a single trading day, as published daily by FINRA for trades reported to its facilities.

## Market structure

- [After-hours trading](https://www.quantisnow.com/glossary/after-hours-trading.md): Trading in US stocks after the 4:00 p.m. ET close, usually until 8:00 p.m. ET, when earnings and other news often break.
- [Bid-ask spread](https://www.quantisnow.com/glossary/bid-ask-spread.md): The gap between the highest price a buyer will pay (the bid) and the lowest price a seller will accept (the ask) for a security.
- [Catalyst](https://www.quantisnow.com/glossary/catalyst.md): An event or piece of news that causes, or is expected to cause, a significant move in a stock's price.
- [Dark pool](https://www.quantisnow.com/glossary/dark-pool.md): A private trading venue that matches buy and sell orders without displaying quotes publicly, reporting trades only after they execute.
- [FINRA](https://www.quantisnow.com/glossary/finra.md): The self-regulatory organization that oversees US broker-dealers, licenses their representatives and collects short interest and off-exchange trade data.
- [Gap up and gap down](https://www.quantisnow.com/glossary/gap.md): A price jump between sessions, when a stock opens above the prior high (gap up) or below the prior low (gap down), usually on news.
- [Level 2 quotes](https://www.quantisnow.com/glossary/level-2.md): Market data showing the full depth of bids and offers at multiple price levels, not just the best bid and ask.
- [Limit order](https://www.quantisnow.com/glossary/limit-order.md): An order to buy or sell at a specified price or better, which controls the price but does not guarantee the order will fill.
- [Limit up-limit down (LULD)](https://www.quantisnow.com/glossary/luld.md): A US rule that sets price bands around each stock's recent average price and pauses trading for five minutes when the stock cannot trade inside them.
- [Market maker](https://www.quantisnow.com/glossary/market-maker.md): A firm that continuously quotes both a buy and a sell price in a security, earning the spread in exchange for supplying liquidity.
- [Market order](https://www.quantisnow.com/glossary/market-order.md): An order to buy or sell immediately at the best available price, which guarantees execution but not the price.
- [Market-wide circuit breaker](https://www.quantisnow.com/glossary/circuit-breaker.md): A rule that halts trading in all US stocks when the S&P 500 falls 7%, 13% or 20% from the prior day's close.
- [Minimum bid price requirement](https://www.quantisnow.com/glossary/minimum-bid-price.md): An exchange listing rule requiring a stock to trade at $1.00 or more, with a deficiency notice after 30 consecutive business days below it.
- [Nasdaq](https://www.quantisnow.com/glossary/nasdaq.md): A US stock exchange, launched in 1971 as the first electronic market, that lists thousands of companies across three market tiers.
- [NBBO (national best bid and offer)](https://www.quantisnow.com/glossary/nbbo.md): The highest bid and lowest offer for a stock across all US exchanges, the benchmark brokers use for best execution.
- [NYSE](https://www.quantisnow.com/glossary/nyse.md): The New York Stock Exchange, the largest US stock exchange by listed market value, owned by Intercontinental Exchange since 2013.
- [OTC markets](https://www.quantisnow.com/glossary/otc-markets.md): Trading venues outside the national exchanges where stocks trade through broker-dealer networks, mainly the OTCQX, OTCQB and Pink tiers.
- [Payment for order flow](https://www.quantisnow.com/glossary/payment-for-order-flow.md): Compensation a broker receives from a market maker for routing customer orders to it for execution, common in commission-free US retail brokerage.
- [Penny stock](https://www.quantisnow.com/glossary/penny-stock.md): A low-priced, usually small and thinly traded stock, defined by SEC rules generally as an equity security trading below $5 per share.
- [Pre-market trading](https://www.quantisnow.com/glossary/pre-market-trading.md): Trading in US stocks before the 9:30 a.m. ET open, typically from 4:00 a.m. ET, with thinner liquidity and wider spreads.
- [Press release](https://www.quantisnow.com/glossary/press-release.md): An official company announcement distributed through a newswire, used to disclose earnings, deals, trial results and other news to the public.
- [Relative volume](https://www.quantisnow.com/glossary/relative-volume.md): A ratio comparing a stock's current trading volume to its typical volume for the same period, used to spot unusual activity.
- [SEC (Securities and Exchange Commission)](https://www.quantisnow.com/glossary/sec.md): The US federal agency that regulates securities markets, enforces securities laws and oversees the disclosures public companies must file.
- [Small-cap stock](https://www.quantisnow.com/glossary/small-cap.md): A stock of a company with a relatively small market capitalization, commonly defined as roughly $300 million to $2 billion.
- [Stop-loss order](https://www.quantisnow.com/glossary/stop-loss-order.md): An order that becomes a market order to sell (or buy) once a stock trades at a specified stop price, used to limit losses.
- [T+1 settlement](https://www.quantisnow.com/glossary/t-plus-1.md): The US standard under which most stock trades settle one business day after the trade date, in effect since May 28, 2024.
- [Trading halt](https://www.quantisnow.com/glossary/trading-halt.md): A temporary stop in trading of a security, called by an exchange or regulator for pending news, volatility, or regulatory concerns.
- [VWAP (volume-weighted average price)](https://www.quantisnow.com/glossary/vwap.md): The average price a security traded at during a period, weighted by the volume at each price, usually reset each trading day.