SchlappyTrader Academy

Welcome to the Markets

Before diving into algorithms, you need to understand the underlying mechanics of what you are trading. A stock represents fractional ownership of a company. Prices move based on supply and demand.

• The Bid/Ask Spread: The "Bid" is the highest price a buyer is willing to pay. The "Ask" is the lowest price a seller is willing to accept. The difference is the spread.
• Liquidity: Highly liquid stocks (like AAPL) have millions of shares traded daily and very tight spreads. Penny stocks are often illiquid.
• Going Long: Buying a stock hoping it goes up.
• Short Selling: Borrowing shares to sell them, hoping to buy them back later at a lower price to return them. You profit if the stock goes down.