Q - S

Q – S

Q

Quantitative Filters Predefined rules that apply numerical thresholds to asset inclusion, such as volume, volatility, or concentration scores.

Quorums Minimum participation levels required in a governance vote for the result to be valid, ensuring legitimacy in DAO (Decentralized Autonomous Organization) decision-making.

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R

Rebalancing The process of adjusting index asset weights back to target allocations, typically on a fixed schedule or after threshold deviations. (See Rebalancing Schedule for details.)

Redemption Rights The ability for users to convert index tokens back into USDC at NAV (Net Asset Value).

Regulated Custodian A licensed third-party financial institution that safeguards digital assets on behalf of clients or protocols, ensuring compliance and segregation of risk.

Rewards Tokens distributed to users as incentives for participating in staking, governance, or referral programs.

Risk Profile An evaluation of an asset or portfolio’s volatility, liquidity, and drawdown behavior, used to align with investor objectives. (See Risk Management for details.)

Risk-Adjusted Return A performance measure that incorporates volatility to assess efficiency of returns. Common ratios include Sharpe Ratio, Sortino Ratio, and CVaR (Conditional Value at Risk). (See Analytics Calculation for the formula.)

Risk Management A framework of models, controls, and policies designed to measure, monitor, and mitigate financial, technical, and systemic risks. (See Risk Management for details.)

Risk Scoring The process of assigning a score to each asset or fund based on factors such as liquidity, volatility, concentration, and historical performance. (See Risk Management for details.)

Risk-Free Rate (RFR) The theoretical rate of return of an investment considered free of default risk. In practice, often proxied by government bonds (e.g., U.S. Treasuries, French OATs). (See Analytics Calculation for the formula.)

Rug Pulls Events where a protocol or asset is suddenly abandoned or drained of liquidity, leaving investors with losses.

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S

Sector Index An index that groups assets by industry or thematic category (e.g., DeFi, AI, Layer 2, RWA). Sector indices allow investors to target specific parts of the digital asset market while maintaining diversification within that sector. (See Sector Index for details.)

Security Token A blockchain-based token that represents ownership of a real-world financial asset (such as equity or debt) and falls under securities regulation.

Sharpe Ratio A measure of return relative to risk, calculated as the excess return over the risk-free rate divided by volatility. It indicates how efficiently a portfolio delivers returns for each unit of risk taken. (See Analytics Calculation for the formula.)

Short Position A trading or investment stance where an asset is sold with the expectation that its value will fall. In traditional finance, this often involves borrowing the asset to sell it, then repurchasing later at a lower price. In crypto, shorts can be taken via futures or perpetual contracts. Taking a short position means being bearish on the asset (opposite of a long position).

Single Asset Cap (35%) A rule that limits the maximum weight a single token can have in an index to 35%, reducing concentration risk.

Slippage The difference between the expected execution price of a trade and the actual price achieved, often due to limited liquidity. (See Slippage Princing Logic for details)

Slippage Modeling The process of estimating the likely price impact of a trade before execution, especially in thin markets.

Slippage-Adjusted Pricing A pricing approach that incorporates expected slippage into NAV calculations to improve accuracy.

Sortino Ratio A variation of the Sharpe ratio that considers only downside volatility, offering a more conservative view of return quality. (See Analytics Calculation for the formula.)

Spot Price The current market price of an asset for immediate settlement, as opposed to a forward or derivative price.

Staking The act of locking tokens into a contract to earn rewards, participate in governance, or support network security. (See Staking & Rewards for details.)

Strike Price The predetermined price at which an option holder can buy (call option) or sell (put option) the underlying asset (See Option Module for details.)

Survivorship Bias A statistical bias that arises when only successful or surviving assets are considered in an analysis, overstating performance.

Swaps A class of derivative contracts where two parties exchange (or “swap”) cash flows or exposures.

• In traditional finance: interest rate swaps (fixed vs. floating) and currency swaps (different currencies).

• In crypto: perpetual swaps (derivatives without expiry) are common.