The short answer
When a condition depends on a missing value, that condition is UNKNOWN. The combined rule can still be TRUE or FALSE if another condition already determines the result, as the table below shows. Replacing UNKNOWN with TRUE or FALSE can change which securities pass or fail. Keeping UNKNOWN visible lets you decide explicitly how to handle missing data.
The five combinations to remember
Conditions are combined with AND, OR and NOT. With a third value, UNKNOWN, the results follow one idea: if the known part already decides the answer, the answer is known; otherwise it stays UNKNOWN.
| Expression | Result | Why |
|---|---|---|
| TRUE AND UNKNOWN | UNKNOWN | The result depends on the missing part |
| FALSE AND UNKNOWN | FALSE | One false condition is enough for AND |
| TRUE OR UNKNOWN | TRUE | One true condition is enough for OR |
| FALSE OR UNKNOWN | UNKNOWN | The result depends on the missing part |
| NOT UNKNOWN | UNKNOWN | The opposite of an unknown is still unknown |
SQL’s three-valued logic follows the same rules; PostgreSQL, for example, documents that its NULL value represents “unknown”.
A worked example
A screening rule: price-to-earnings ratio below 15 AND revenue growth above 0%. Three hypothetical securities; the numbers are invented.
| Security | Each condition | Rule result |
|---|---|---|
| A | P/E 12: TRUE; growth 5%: TRUE | TRUE |
| B | P/E 20: FALSE; growth missing: UNKNOWN | FALSE |
| C | P/E 10: TRUE; growth missing: UNKNOWN | UNKNOWN |
- A passes: both conditions are known and true.
- B fails even without its growth figure, because its P/E already fails an AND rule.
- C cannot be decided. If missing data were treated as FALSE, C would silently disappear from the results; if it were treated as TRUE, C would silently pass. Neither is what the data says.
Reporting three groups (passed, failed, not decidable) keeps C visible, so you can find the missing figure, exclude C on purpose, or note the gap in your research record.
Limits and common misreadings
- UNKNOWN is not a guess. It does not mean “probably true” or “probably false”; it means the rule could not be evaluated.
- The order of conditions does not matter. AND and OR give the same result whichever side is written first.
- Missing and zero are different. Revenue growth of 0% is a known value (and fails “above 0%”); a missing figure is UNKNOWN.
- This explains a method. It does not mean this site offers a rule checker.