Glossary
ATM
At the money — the strike closest to where the index is currently trading.
FDR
False discovery rate — an adjustment for having tested many ideas. Test enough ideas and some look good by luck alone; this corrects for that.
PCR
Put-call ratio — puts divided by calls. A high figure usually means the crowd is positioned defensively.
baseline
What the same quantity (an ATM straddle's price, implied volatility) typically did across the whole panel over the same time window, regardless of whether this pattern's own condition held that day. The effect size is tested against this, not against zero — an ATM straddle loses value over almost any two-session window, for instance, so a pattern's own baseline can already be far from zero, and a large-looking raw effect is not automatically outperforming an ordinary day. The confidence interval is reported as the excess over this baseline for the same reason.
confidence interval
The range the true value plausibly sits in. A wide range means the estimate is uncertain.
days to expiry
How many calendar days remain before the contract settles. Abbreviated DTE throughout the Analyst tables.
implied volatility
How much movement the option's price implies the market expects, quoted as a yearly percentage. High means options are expensive.
max pain
The strike at which option buyers collectively lose the most if the index settles there.
open interest
The number of contracts currently open and unsettled. It shows how much money is committed at a strike, not how much traded today.
out-of-sample
Years deliberately held back while looking for the pattern, then used to check whether it still holds. It is the main defence against fooling yourself.
regime
A span of years with the same market rules. BankNifty's expiry rules changed twice, so results are reported per regime.
skew
The gap between the cost of downside and upside protection. Positive skew means crash insurance is dearer than upside bets.
straddle
Buying a call and a put at the same strike. It profits from a large move in either direction and loses if nothing happens.
theta
The rate at which an option loses value simply because time passes.
weekly expiry
A contract that settled every Thursday rather than only at the end of the month. Introduced for BankNifty in 2016 and abolished in late 2024 — a pattern that only worked during this era cannot be used today.
went predicted direction / matched
The share of events that moved the way this pattern's own prior said they would — not simply the share with a positive raw outcome. For a pattern that predicts a fall, an event that fell counts here, even though its raw change was negative. This is the same number the plain-English "It worked N times out of M" sentence is built from, so the two registers never disagree about the same pattern.