Tag Archives: Traders

Investment Technology

As always, there are exceptions to all rules. The Gapping Plays are those exceptions. As  previously discussed, the gap at the top of a trend is the exhaustion gap. The same is said for the gap at the bottom of a trend. The appearance of those gaps is either the last gasp exhilaration (at the top) or the last gasp panic (at the bottom).

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Selling Gaps

Now turn the tables over.  The same enthusiasm demonstrated by a gap to the upside is  just as pertinent for sellers on the downside. A gap down illustrates the desire for investors to get out of a stock very quickly.  Identifying clear Candlestick “sell” signals prepares the investor for potential reversals. The Doji at the top, Dark Clouds, Bearish Engulfing patterns are obvious signals

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Traders And Investors

SOME STRATEGIES FOR WRITING COVERED CALLS STRATEGY 1       This is the strategy that works best in India since options of fundamentally strong stocks continue to have some time premium left till the last day. You should write at-the-money calls since these give the maximum premium inflow. It is critical, however, that once covered call writing is accepted as a strategy, nse india,  traders should write calls

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Stock Trading

WRITING COVERED CALLS  Writing (Selling) Call Options when you already own the underlying is called writing covered call options. It is against writing Naked options which can have unlimited risk. HOW WRITING COVERED CALL OPTION WORKS As discussed earlier a Call is the right to buy an underlying asset above a certain price, and before a certain date. Now only the liquid calls in

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Future Option Trading System

PLACING ORDERS ON THE TRADING SYSTEM For both the futures and the options market, while entering orders on the trading system, members are required to identify orders as being proprietary or client orders. Proprietary orders should be identified as ‘pro’ and those of clients should be identified as ‘cli’. Apart from this, in the case of ‘c li’ trades, the client account number should

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Future & Options Market

THE TRADER WORKSTATION MARKET WATCH WINDOW: The following windows are displayed on the Trader Workstation Screen. TITLE BAR TICKER WINDOW OF FUTURES & OPTIONS MARKET TICKER WINDOW OF UNDERLYING (CAPITAL) MARKET TOOL BAR MARKET WATCH WINDOW INQUIRY WINDOW SNAP QUOTE ORDER/TRADE WINDOW SYSTEM MESSAGE WINDOW As mentioned earlier, the best way to familiarize oneself with the screen and its various segments is to actually spend

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Bullish Security

SPECULATION. BULLISH SECURITY. BUY FUTURES Take the case of a speculator who has a view on the direction of the market. He would like to trade based on this view. He believes that a particular security that trades at Rs. 1000 is undervalued and expect its price to go up in the next two to three months. How can he trade based on this

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Single Stock Futures

APPLICATIONS OF FUTURES AND OPTIONS The phenomenal growth of financial derivatives across the world is attributed the fulfilment of needs of hedgers, speculators and arbitraguers by these products. In this chapter we first look at how trading futures differs from trading the underlying spot. We then look at the payoff of these contracts, and finally at how these contracts can be used by various entities in

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Introduction To Derivatives

The emergence of the Market for Derivative products, most notably forwards, futures and options can be traced back to the willingness of risk-averse economic agents to guard themselves against uncertainties arising out of fluctuations in asset prices. By their very nature the financial markets are marked by a very high degree of volatility. Through the use of derivative products it is possible to partially

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