Reference
Glossary
The terms we use, defined the way we use them.
- 10-year yield
- The interest rate on 10-year US government debt. It is the reference rate for mortgages, company valuations and much more.
- Basis point
- One hundredth of a percentage point. A yield that moves from 5.10% to 5.02% has fallen 8 basis points, written 8 bp.
- Breakeven inflation
- The gap between regular and inflation-protected Treasury yields. It shows the inflation rate markets expect.
- Brent
- The main global oil benchmark, based on North Sea crude. Most of the world's traded oil is priced against it.
- Capex
- Capital expenditure. Money a company spends on long-lived assets such as data centres, chips and factories.
- Cause File
- Causa's unit of analysis. One market move, its cause, a transmission chain, sourced evidence, a confidence grade and a falsifier.
- Dollar index
- A measure of the US dollar against six major currencies, often called DXY.
- Dot plot
- A chart of where each Fed official expects rates to be in future years. Markets read it for the direction of policy.
- Dovish
- Leaning toward lower interest rates to support growth and jobs.
- Evidence grade
- Our confidence in a Cause File. A means strong and independently confirmed, B means plausible with overlapping causes, C means best available with live alternatives.
- Falsifier
- A measurable condition, with a deadline, that would prove a Cause File wrong. We publish it with the file and check it against closing prices.
- Federal funds rate
- The short-term interest rate the Federal Reserve targets. It was set at 3.75% to 4.00% after the September 2026 hike.
- FOMC
- The Federal Open Market Committee, the group inside the Federal Reserve that votes on interest rates. It meets eight times a year.
- Free cash flow
- Cash a company generates after paying for operations and capital spending.
- Funding rate
- A periodic payment between long and short traders in perpetual futures. High positive funding means many traders are paying to stay long.
- Guidance
- A company's own forecast for future results or spending. It often moves a share price more than the quarter just reported.
- Haven
- An asset investors buy when they are frightened, such as US Treasuries, gold, the dollar or the Swiss franc.
- Hawkish
- Leaning toward higher interest rates to fight inflation.
- Held
- A falsifier whose deadline passed without its condition being met. The explanation survived its own test.
- Liquidation
- The forced closing of a leveraged position when losses use up the trader's margin. Large waves of liquidations can speed up a move.
- Open interest
- The total number of outstanding futures or options contracts. Rising open interest means more money is committed to a market.
- Provisional price
- An intraday or unconfirmed price. The Scorecard never resolves a falsifier on a provisional price.
- Spot ETF
- An exchange-traded fund that holds the actual asset, such as bitcoin, rather than futures. Daily flows into these funds are a closely watched demand signal.
- Stablecoin
- A crypto token designed to hold a steady value, usually one US dollar. Their supply is a rough gauge of money ready to enter crypto.
- Transmission chain
- The steps from an event to a price move. For example: a drone strike, then fear for supply, then a higher oil price.
- Triggered
- A falsifier whose condition was met before the deadline. The explanation failed its own test, and we say so on the Scorecard.
- VIX
- An index of expected volatility in the S&P 500 over the next 30 days, built from options prices. Often called the fear gauge.
- WTI
- West Texas Intermediate, the main US oil benchmark, delivered at Cushing, Oklahoma.
- Yield curve
- Yields on government debt plotted from short to long maturities. When short yields sit above long yields the curve is inverted, which has often come before recessions.