> For the complete documentation index, see [llms.txt](https://guida-2.gitbook.io/guida-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://guida-2.gitbook.io/guida-docs/reference/glossary.md).

# Glossary

Plain-English definitions of the terms you'll encounter in Guida and across crypto and trading. Skim it once, or refer back whenever a word trips you up.

## Trading terms

**Autonomous trading agent** Software that executes a trading strategy on your behalf, monitoring the market and acting on your rules without you pressing the button each time. In Guida, the agent is bounded by rules and limits you define.

**Backtesting** Running a strategy against historical market data to see how it would have performed. A sanity check — not a guarantee of future results. See [Backtesting](/guida-docs/core-concepts/backtesting.md).

**Paper trading** Running a strategy on live market prices with simulated (fake) funds. Real conditions, zero financial risk. See [Paper Trading](/guida-docs/core-concepts/paper-trading.md).

**Strategy** A defined set of rules for when to act, what to do, and how much to risk — built from triggers, actions, sizing, and exits. See [Strategies](/guida-docs/core-concepts/strategies.md).

**Trigger** A condition that, when true, prompts an action — e.g. "when ETH drops 5% in 24 hours."

**Stop-loss** An automatic exit that sells a position once it falls to a level you set, capping your loss.

**Take-profit** An automatic exit that sells a position once it rises to a target you set, locking in gains.

**Position sizing** How much capital you put into a single trade. Sensible sizing keeps any one loss survivable.

**Maximum spend** A cap on the total capital a strategy is ever allowed to commit.

**Drawdown** The decline from a peak in your balance to a subsequent low. *Maximum drawdown* is the worst such drop — a key measure of how rough a strategy's ride is.

**Win rate** The percentage of trades that end profitably. Best read alongside drawdown and average win/loss size — a high win rate can still lose money.

**Equity curve** A chart of your account balance over time. Its shape reveals the ride, not just the destination.

**Slippage** The difference between the price you expect and the price you actually get, especially in fast or thin markets.

**Liquidity** How easily an asset can be bought or sold without significantly moving its price. Deep liquidity means smoother trades.

**Volatility** How much and how quickly an asset's price moves. Higher volatility means more risk and more opportunity.

**Dollar-cost averaging (DCA)** Buying a fixed amount on a regular schedule regardless of price, to smooth out your average entry over time.

## Crypto & on-chain terms

**Blockchain** A shared, tamper-resistant digital ledger that records transactions across a network — the foundation of crypto and on-chain assets.

**On-chain** Something that happens directly on a blockchain, as opposed to on a private company's internal systems ("off-chain").

**Token** A unit of value recorded on a blockchain. It can represent a cryptocurrency, or a tokenized version of a real-world asset.

**Tokenization** Creating an on-chain token that represents ownership of, or economic exposure to, a real-world asset like a stock or commodity.

**Real-world asset (RWA)** A traditional asset — stock, bond, commodity, currency — represented on-chain as a token. See [Tokenized Stocks & RWAs](/guida-docs/assets/tokenized-rwa.md).

**Tokenized stock** A token whose value tracks a real company's share price, allowing exposure to that stock on-chain, often 24/7.

**Composability** The ability of on-chain services and assets to plug into one another, so a position in one application can be used in another — something traditional finance largely can't do.

**Non-custodial** An arrangement where you retain control of your own assets, rather than handing custody to a third party.

**Wallet** Software (or hardware) that holds the keys to your on-chain assets and lets you interact with blockchain applications.

**24/7 markets** Markets that never close. Crypto trades around the clock, and tokenized real-world assets increasingly do too — the environment an always-on agent is built for.

***

Missing a term? The [Core Concepts](/guida-docs/core-concepts/concepts.md) section explains the big ideas in depth.


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