Instead of just simply being a social community where individuals who share a common interest can meet and share their thoughts and opinions, many social trading communities have turned into de facto investment advisory services. Like any network of people, online or off, certain individuals will rise above the crowd as leaders, and others will be followers. In the case of a trading network, some followers will trade based solely on the recommendations of the leaders. In some cases this works out well, in other cases...not so much.
Volatility is often discussed as a single number. However, in the real world, the volatility of each strike price and in each month is different than the neighboring one. Skew is simply the volatility curve that is formed by plotting the individual volatilities of each option strike. The shape of this curve is often referred to as the volatility "smile" or "smirk."
The 3 simple rules of Elliott wave analysis can help traders manage risk, ride market trends and spot price reversals. EWI's Chief Commodities Analyst Jeffrey Kennedy values the Wave Principle not only as an analytical tool, but also as a real-time trading tool. In this excerpt from Jeffrey's free Best of Trader's Classroom eBook, he shows you how the Wave Principle's built-in rules can help you set your protective stops when trading.
You've probably heard some of the following sayings and terms from the financial press..."Sell in May and Go Away", "The Santa Claus Rally", "The January Effect", etc. The question is, does the stock market have seasonal patterns that an investor can use to enhance their returns? The answer is yes, but...
There is, in fact, a seasonal bias to the stock market, and by paying attention to these market tendencies your portfolio can gain a slight edge over the long haul. However, these macro trends don't always hold true, and won't save you when you're wrong on a micro trend.
Is price volatility a good measure of risk? Warren Buffett would probably say no. He once famously quipped that the true risk of an investment is the potential for “permanent loss of capital.” But for most investors price volatility does matter. Say you own two equity funds: Velocity Fund loses 20 percent in the first half of the year but gains 35 percent in the second; Stability Fund gains 4 percent in each half. End result: Both Velocity and Stability are up 8 percent for the year. But wouldn’t you favor Stability over Velocity, assuming their total returns continued to be similar?
The Clark Financial Group has teamed up with One Option to bring you daily stock market alerts. The daily updates are posted shortly following the start of trading each day. The reports discuss the current state of the stock and options markets, and give you some actionable trading ideas. These alerts are written by Pete Stolcers of One Option. Pete has a 20 year track record of proven success as a CBOT floor trader. The quality and accuracy of his recommendations are outstanding! Click here to see today's report!
Imagine, for a moment, what investing would be like if you knew you could not fail. Never again would you sell a winning position too soon, or hold onto a loser far too long. You'd make decisions based on what you know you should do, rather than what your emotions tell you to do. That may seem like and impossible dream, but it's not. The good news is, these professional trading skills can be learned, as long as you're willing to put aside your own pre-conceived notions, as well as everything you've been told by your broker or the media.
This is a strategy for trading options that has worked well for us in the past, and we expect this method to continue generating quick profits for us in the future. This strategy will use butterfly spreads to make money in the last week before options expiration. The downside to this particular strategy is that we can only use it at a certain time of each month. We’ll trade the last week of trading before options expiration, which occurs on the third Friday of each month. We’ll utilize the concept of, “stock pinning” (sometimes called “pinning the strike” or “options pain”) to make profits using a low risk option trading strategy.
The convergence and divergence of moving averages can be a very powerful technical indicator. The MACD (Moving Average Convergence/Divergence) is a trend-following momentum indicator that shows the relationship between two moving averages of prices. It's one of the most popular indicators used by traders, but it's also one that is often used incorrectly, thereby giving traders false signals...and losses. We'll show you the right way to use the MACD.
Online Trading Academy is the biggest name in trading education...but are they worth the money? We're often asked if the Online Trading Academy is a good place to learn how to trade for a living, or if it's a scam. Can't you just learn from experience and reading tutorials on the internet? We'll answer your questions in this Online Trading Academy review.
The difference between success and failure as a trader typically lies in one's trading money management plan and execution. In order to maximize gains and minimize losses, you must have a solid plan in place, and the discipline to execute it. Trading Money Management