Market Volatility

Posted November 28, 2011 By admin

VIXTrading volatility is a common theme amongst traders. Trader beware, however. Trading volatility has a negative long term expectation because the average stock has upward movement, on the average, and volatility mainly targets falling prices. If you are looking for a short term trade, however, trading the volatility of a stock can be a very profitable experience for you.

Volatility has become a popular thing to trade, making it its own class of asset just like Forex Arbitrage. There are now basket funds out there that are centering themselves around the sharp movements that many stocks are now experiencing. ETFs that target volatility might be looking for stocks that are likely to experience sharp downward movement and will take a short position, or they might be trying to make a quick profit off of a stock that rebounds late in trading sessions. Either way, volatility trading can be a good addition to your trading portfolio.

Volatility trading is used by many people as a hedge against future catastrophic losses. But this type of trading does not need to be used only by the super rich within their hedge funds. You can take advantage of volatility even trading on the smaller scale. With funds like VIX out there, you can trade an index’s volatility. This fund revolves around the S&P 500’s movements and has seen plenty of movement itself over the past year. It’s ranged from below $15 per share all the way up the $48 per share. If you want to take advantage of these crazy times, trading volatility might just be what you are looking for.

Categories: Robot
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Insider Trading

Posted July 26, 2011 By admin

Insider trading has dual meanings: a legal and an illegal definition.

Legally, insider traders are corporate insiders such as corporate officers, directors, and employees who buy and sell stock in their own companies. When these employees transact trades in the company’s stock, it must be reported to the Securities and Exchange Commission (SEC).

This information becomes public knowledge.

Illegal insider trading, which is in the news more than legal insider trading, refers to the buying and selling of security that is in breach of a fiduciary duty or other relationship of trust and confidence, when the person transacting the trade possesses material, nonpublic information about the security.

Violations may include “tipping” information from a corporate insider to an external party. The securities are then traded by this party, who usually benefits. The person who gives the information may be accused of misappropriating the information.

One popular Hollywood movie that depicted insider trading was Wall Street with Charlie Sheen and Michael Douglas. Douglas tipped inside information to Charlie Sheen, his stockbroker, who then traded on the information. He was able to profit from the information. Using products like the Elemental Trader will help you avoid the inside trading route.

Those convicted of insider trading may face jail time and an expulsion from securities industry.

Categories: Robot
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The Housing Market

Posted May 23, 2011 By admin

Two things are certain: death and taxes. Everything else will come and go. Such is the case with the housing market, which has seen slow but steady growth for a small period of time. However, the U.S. housing market, which was finally starting to look up, is falling once again.

The outlook the American people have on the economy is tied to housing numbers. Now that a decrease has been seen again, with work on houses down by 11 percent over the past two months, people are hesitant about what this means for the nation. The construction starts and permits fell in April, landing at an adjusted annual rate of 523,000 units. Considering that the number was at almost 600,000 units in March, there is cause for concern.

In fact with the news of the housing market possibly hitting another all-time low, the Dow Jones opened to a weak reading this morning, falling 75 points. This information tends to smear the forecast of the economic recovery. Residential construction has dropped a total of 23.9 percent since April of last year and it appears the faith some investors had restored in the housing market may have to wait until 2012. If new houses aren’t being built and construction ceases in certain neighborhoods, Americans may begin to panic that the great fall of 2008 is being followed by the greater fall of 2011.

Stay tuned for more information on the Forex income engine and other great trading ideas.

Categories: Robot
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