Glossary

Every term used in PropChange, in plain language.

A

Allocation: See Seat Allocation.
Averaging down: Adding to a position while it is in unrealized loss. Detected as a risk flag and can be a prohibited pattern in the Seat Contract.

B

Breach: A violation of the Seat Contract. Hard breaches (drawdown, daily loss, leverage, position size, prohibited instrument or pattern) stop copying and refund the full Epoch fee. Soft breaches (minimum activity, repeated data gaps) are refunded pro-rata.

C

Calmar ratio: Annualized return divided by max drawdown.
Capacity: Maximum follower capital a strategy can absorb before follower slippage destroys a defined share (one third) of its edge.
Compliance Score: Share of settled Epochs in which the trader kept the Seat Contract, shown with the count (e.g. 11/12). The default ranking signal.

D

Drawdown: Decline of the NAV from its previous peak. Max drawdown is the largest such decline.

E

Epoch: A settlement period, 30 days by default. Longer Seat terms are paid upfront but settled per Epoch.
Escrow: On-chain account (one per strategy and Epoch) that holds Seat Fees in USDC until settlement.
Expectancy: Average profit per trade, expressed in basis points of notional. Used as the strategy's 'edge' in the Capacity model.

K

Kill switch: One-click control that stops all copying into your account immediately.

N

NAV: Net asset value index of a strategy, adjusted for deposits and withdrawals, starting at 1.0. All return and risk metrics use NAV.

O

Occupancy: Seats taken divided by Seats available. Raises the Seat price: × (1 + 0.5 × occupancy²).
Oracle: The PropChange backend signs settlement and breach reports and submits them on-chain. Evidence for every report is published.

P

Probabilistic Sharpe Ratio (PSR): Probability that the true Sharpe ratio is above zero, adjusted for sample size, skewness and kurtosis. Below 0.9 suggests the result may be luck.

S

Seat Contract: Rules generated from a strategy's own history — max drawdown, daily loss, leverage, position size, instruments, minimum activity — frozen for each Epoch. The trader may tighten, never loosen.
Seat: The right to copy one strategy up to a fixed Seat Allocation of your own capital, for as long as the Seat Fee is paid. Not trading capital and not a claim on profits.
Seat Allocation: The amount of your own capital one Seat lets you copy, e.g. $3,000. Scales down equally for all Seats if Capacity falls.
Seat Fee: USDC paid per Seat per Epoch, held in escrow and released to the trader only if the contract is kept.
Settlement: End-of-Epoch resolution: release to the trader (75%) and platform (25%), or refund to followers.
Sharpe ratio: Mean daily excess return divided by its standard deviation, annualized.
Slippage: Difference between a follower's fill price and the trader's fill price. Tracked per trade and used to recalibrate Capacity.
Sortino ratio: Like Sharpe, but only penalizes downside volatility.
Strategy: A tradable unit with its own sub-account, history, analytics, Capacity and Seat Contract. A trader may have many.

R

Risk Engine: Independent protection layer on every follower account: order scaling, protective stops, circuit breakers and personal loss limits.
Risk Score: 0–100 score (higher is riskier) combining max drawdown, Ulcer index, CVaR, leverage and risk flags.
Rookie: Stage for new strategies with minimum verified history: limited Seats (≤ 10% of Capacity) and capped price, until 3 consecutive kept Epochs.

T

Trader Bond: USDC locked by the trader per strategy (1% of Capacity, min. 500). Slashed only for fraud and distributed to Seat holders.

U

Ulcer index: Root-mean-square of drawdowns — captures both depth and duration of losses.

V

Verified+: Full API-sourced history, KYC, posted Trader Bond and a record of kept Epochs.

W

Waitlist: First-in, first-out queue for full strategies.

Calmar ratio

Annualized return divided by max drawdown.

Capacity

Maximum follower capital a strategy can absorb before follower slippage destroys a defined share (one third) of its edge.

Compliance Score

Share of settled Epochs in which the trader kept the Seat Contract, shown with the count (e.g. 11/12). The default ranking signal.

Epoch

A settlement period, 30 days by default. Longer Seat terms are paid upfront but settled per Epoch.

Escrow

On-chain account (one per strategy and Epoch) that holds Seat Fees in USDC until settlement.

Expectancy

Average profit per trade, expressed in basis points of notional. Used as the strategy's 'edge' in the Capacity model.

Seat Contract

Rules generated from a strategy's own history — max drawdown, daily loss, leverage, position size, instruments, minimum activity — frozen for each Epoch. The trader may tighten, never loosen.

Seat

The right to copy one strategy up to a fixed Seat Allocation of your own capital, for as long as the Seat Fee is paid. Not trading capital and not a claim on profits.

Seat Allocation

The amount of your own capital one Seat lets you copy, e.g. $3,000. Scales down equally for all Seats if Capacity falls.

Seat Fee

USDC paid per Seat per Epoch, held in escrow and released to the trader only if the contract is kept.

Settlement

End-of-Epoch resolution: release to the trader (75%) and platform (25%), or refund to followers.

Sharpe ratio

Mean daily excess return divided by its standard deviation, annualized.

Slippage

Difference between a follower's fill price and the trader's fill price. Tracked per trade and used to recalibrate Capacity.

Sortino ratio

Like Sharpe, but only penalizes downside volatility.

Strategy

A tradable unit with its own sub-account, history, analytics, Capacity and Seat Contract. A trader may have many.

Risk Engine

Independent protection layer on every follower account: order scaling, protective stops, circuit breakers and personal loss limits.

Risk Score

0–100 score (higher is riskier) combining max drawdown, Ulcer index, CVaR, leverage and risk flags.

Rookie

Stage for new strategies with minimum verified history: limited Seats (≤ 10% of Capacity) and capped price, until 3 consecutive kept Epochs.