🎓 Knowledge Base

📦What is an ETF?

BEGINNER

An ETF (Exchange-Traded Fund) is like a basket that holds many investments inside it. Instead of buying 500 individual stocks, you buy one share of SPY and you instantly own a tiny piece of all 500 companies in the S&P 500.

ETFs trade on the stock exchange just like regular stocks. You can buy and sell them throughout the day at the current market price. They have ticker symbols (SPY, QQQ, IWM) just like individual stocks.

Key facts about ETFs

ETFs are managed by companies like Vanguard, BlackRock (iShares), and State Street (SPDR). The manager ensures the ETF tracks its target index or follows its stated strategy. You pay a small annual fee called an expense ratio for this service — typically 0.03% to 0.75% of your investment.

When you buy one share of SPY at ~$580, you effectively own a proportional piece of Apple, Microsoft, Amazon, Google, and 496 other companies. That's instant diversification.

🤔Why Do People Invest in ETFs?

BEGINNER

Diversification. One ETF gives you exposure to dozens or hundreds of companies. If one stock drops 50%, it barely affects the overall ETF because it's spread across many holdings.

Low cost. ETFs like VOO charge 0.03% annually — that's $3 per year for every $10,000 invested. Compare that to mutual funds that can charge 1-2%.

Simplicity. You don't need to research individual stocks. Buy one ETF and you have a diversified portfolio.

Liquidity. ETFs trade all day. You can buy or sell in seconds. You always know the current price.

Transparency. ETFs publish their holdings daily. You know exactly what you own at all times.

🏷️Types of ETFs

BEGINNER

Not all ETFs are the same. Here are the main categories we track on MarqetDataLabs:

💸Expense Ratios Explained

BEGINNER

The expense ratio is the annual fee you pay to own an ETF. It's expressed as a percentage and deducted automatically — you never write a check for it.

Lower is generally better. Index ETFs like VOO (0.03%) and SPY (0.0945%) are very cheap. Actively managed ETFs like ARKK (0.75%) charge more because a human is making decisions.

⚖️Passive vs Active Management

INTERMEDIATE

The data is clear: over 10+ year periods, roughly 85-90% of actively managed funds underperform their benchmark index. This doesn't mean active management never works — it means it's hard to pick the winners in advance.

Many investors use a "core-satellite" approach: most of their money in passive index funds (the core), with a smaller allocation to active or thematic ETFs (satellites) for specific bets.

🎯What Are Options?

INTERMEDIATE

An option is a contract that gives you the right (but not the obligation) to buy or sell a stock at a specific price before a specific date.

Call option: The right to BUY a stock at a set price. You profit when the stock goes UP.

Put option: The right to SELL a stock at a set price. You profit when the stock goes DOWN.

Options have three key components: the strike price (the price you can buy/sell at), the expiration date (when the contract expires), and the premium (what you pay for the option).

ΔThe Greeks — Option Sensitivities

ADVANCED

The "Greeks" measure how an option's price changes in response to different factors. We show all five on our options chains.

Delta (Δ) — How much the option moves per $1 move in the stock. A 0.50 delta call gains $0.50 if the stock rises $1. Also approximates the probability of expiring in-the-money.

Gamma (Γ) — How fast delta changes. High gamma means your position gets more sensitive as the stock moves. Highest for at-the-money options near expiration.

Theta (Θ) — Time decay. How much value the option loses each day. Always negative for buyers. Accelerates as expiration approaches.

Vega (V) — Sensitivity to volatility changes. If vega is 0.10, the option gains $0.10 for every 1% increase in implied volatility.

Rho (ρ) — Sensitivity to interest rate changes. Usually the least important Greek for short-term options.

📊Implied Volatility

INTERMEDIATE

Implied volatility (IV) is the market's expectation of how much a stock will move in the future. It's derived from option prices — when people expect big moves, they pay more for options, which drives IV up.

High IV = market expects large moves = options are expensive

Low IV = market expects small moves = options are cheap

We show IV Percentile on the dashboard — this tells you where current IV sits compared to the past year. If IV percentile is 20, it means IV has been higher 80% of the time (options are relatively cheap right now).

📈Technical Analysis Basics

INTERMEDIATE

Technical analysis uses price charts and mathematical indicators to identify trends and patterns. It doesn't predict the future — it helps you understand the current momentum and identify key price levels.

Moving Averages — We show the 50-day and 200-day moving averages. When price is above both, the trend is bullish. Below both = bearish. A "golden cross" (50d crossing above 200d) is a bullish signal.

Bollinger Bands — A channel around the price based on volatility. When bands are tight (squeeze), a big move may be coming. When price touches the upper band, it may be overbought. Lower band = oversold.

RSI (Relative Strength Index) — Measures momentum on a scale of 0-100. Above 70 = overbought (may pull back). Below 30 = oversold (may bounce). We show this as a separate chart.

MACD — Shows momentum direction and strength. When the MACD line crosses above the signal line, momentum is turning bullish. Below = bearish.

🎲Monte Carlo Simulation

ADVANCED

A Monte Carlo simulation runs thousands of randomized future scenarios to estimate the range of possible outcomes. We run 10,000 simulated price paths for each time horizon.

Each path starts at today's price and randomly moves up or down each day based on the ETF's historical volatility. After 10,000 paths, we count where they all ended up — this gives us a probability distribution.

We run two models: baseline (using historical volatility) and IV-adjusted (using implied volatility from the options market). If the IV-adjusted range is wider, the market expects more uncertainty than recent history suggests.

⚠️Risk & Diversification

BEGINNER

Rule #1: Never invest money you can't afford to lose. Markets can and do go down. The S&P 500 has dropped 30-50% multiple times in history (2008, 2020, 2022).

Diversification means spreading your money across different investments so that one bad pick doesn't wipe you out. ETFs provide built-in diversification — one ETF holds dozens or hundreds of stocks.

Risk tolerance varies by person. A 25-year-old saving for retirement can take more risk (more stocks, thematic ETFs) than a 60-year-old who needs the money soon (more bonds, dividend ETFs).

🖥️Using MarqetDataLabs

BEGINNER

Here's how to get the most out of the platform:

Step 1: Pick an ETF

Go to the ETF Hub and select one that interests you. Start with SPY (the S&P 500) if you're new — it's the most popular and has the most data available.

Step 2: Read top to bottom

The dashboard is organized from beginner to advanced. The top sections (price, description, movers, volume) are easy to understand. As you scroll down, the data gets more advanced (options, technical analysis, Monte Carlo).

Step 3: Use the glossary

See a term you don't understand? Check the Glossary — every financial term on the platform is explained in plain language.

Step 4: Read Claude's analysis

The gold-bordered boxes with "★ Claude Analysis" labels are AI-generated interpretations. They explain what the data means in context. Remember: this is educational commentary, not advice.

Step 5: Come back regularly

Data refreshes during market hours (9:30 AM – 4:00 PM ET). The dashboard shows exactly when data was last updated. Check in daily to see how conditions change over time.