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#Finnifty LevelsI’ve created a chart highlighting the key support and resistance levels for Finnifty, designed to help traders make informed decisions. These levels provide critical insights for understanding potential price movements, enabling traders to identify ideal entry and exit points. Use these levels to gain a clearer perspective on Finnifty’s trends and optimize your trades with greater confidence. Remember, these levels serve as guidance, so always combine them with your own analysis and risk management.
NSE:FINNIFTY1!Education
by Prabhu2020
1
Nasdaq-100 Index. The Psychological Aspects of Round NumbersIn the complex dance of commerce and finance, price tags play a key role in influencing consumer decisions. While it’s a fairly common psychological assumption that every penny and cent counts when it comes to getting the best deal, human psychology often deviates from this linear logic. In this educational post, we explore the irresistible appeal of round numbers, and how they often trump other considerations when making transaction decisions. The Irresistible Attraction to Round Numbers We do often believe that every penny counts in our transactions. However, research shows a striking deviation from this assumption. In scenarios where people choose a price, such as tipping at a restaurant or donating to beloved author or website, they disproportionately choose round numbers — like $ 5, $ 10 or $ 20 — far more than would be predicted by chance alone. One could argue that this is due to the rejection of change, a reluctance to waste time on small change, and the unwillingness to bother with complex mathematics. However, even in cases where the exact bill is not an issue (e.g., cashless card payments), the preference remains. For example, diners faced with a non-round bill (for example $ 34.67) are more likely to give non-round tips ($ 15.33), but only so that the total is a neat round number ($ 50). Why do we prefer round prices? And what is the psychology behind it? 1) Cognitive simplicity: The human mind is programmed to simplify and seek simplicity. Numbers like 10, 50, or 100 inherently feel “cleaner” and less chaotic than 17, 62, or 84. This desire for neatness gives us a sense of accomplishment. 2) Perception of quality: The marketing world has long capitalized on this preference for round numbers. Brands strategically associate round prices with premium quality. On the other hand, odd prices like “29.99” or “34.99,” while ubiquitous, subconsciously signal here's a discount or a bargain. 3) This preference is not limited to prices. People exhibit this tendency to round in other aspects of life as well. Our repeated exposure to round numbers is common in a variety of contexts, both in everyday life and during financial transactions, which contributes to an unconscious bias toward them. This cognitive ease with round numbers further perpetuates the preference. The stock market’s behavior and its fluctuations around these significant, round numbers is not a coincidence in general; there is a psychological explanation. Market Psychology of Round Numbers When the market reaches round numbers such as 500 or 1,000, 2,500 or 5,000, 10,000 or 20,000, it attracts the attention of both active traders and casual investors who may not even be actively following the market. As in everyday life, people often use round numbers as thresholds for making investment decisions. For example, some may decide to enter the market if a major index such as the Nasdaq-100 has exceeded 10,000, or they may decide to sell some of their stocks if the Nasdaq-100 has reached 20,000. These round numbers act as magnets for sellers as they mark important milestones given the relatively high rarity of a round number. If the market has the potential to move higher, it first needs to absorb the selling pressure around the round numbers and establish equilibrium before continuing its move higher. If we analyze the market behavior over the last decades, we will see clear patterns at round numbers. Let us take a closer look at a few examples. 1) Indian Stock Index, Sensex BSE:SENSEX Sensex, one of the major market indices in India, has its share of round number syndrome. For example, when Sensex reached 10,000 points in Q1 2006, it experienced significant market activity, with the index fluctuating by as much as 30 percent in Q2. The same phenomenon occurred at multiples of 10,000. Thus, at 20,000 points, which the Indian market reached at the end of 2007, the index collapsed by more than 60 percent over the next 4 quarters of 2008. Later the 20,000 mark has been reached again in the second half of 2010, and the index again suffered a decline of more than 20 percent during 2011. Later Indian stock market index reached the 30,000 mark in the first quarter of 2015, and its led to a price decline of more than 20 percent in the next 4 quarters, while 40,000 mark in the fourth quarter of 2019 - led to the market decline by 30 percent on the wave of COVID-19 sales. 2) Gold market OANDA:XAUUSD As in the previous example, round numbers often become key points of congestion for Gold market, when the market tries to break even higher, but the forces of buyers and sellers may be unequal. For example, spot Gold reached the $ 1,000 mark for the first time in the Q1 2008, which, following the logic discussed above, led to sales and 30 percent decrease. Gold spot buyers have tried a lot to reach $ 2,000 mark in 2011, but it brought the market down by 45 percent over the next 5 years. There were also a lot of unsuccessful attempts to jump above $ 2,000 in 2020-2022. Finally Gold spot surged above $ 2,000 only in Q4 2023, its led to further price increase, up to 2500 US dollars per ounce. 3) US stock index, Nasdaq-100 index NASDAQ:NDX The Nasdaq-100 index approached the 10,000 point mark for the first time in Q1 2020, which could have contributed to the sell-off. In fact, this is what happened, as the market then plunged by more than 30 percent in March 2020, and only thanks to monetary support measures and the reduction of US interest rates to almost zero, the index was able to break the 10,000 barrier by the end of Q2 2020. Reaching the 20,000 mark by the market index in Q2 2024, as we see, again leads to increased turbulence in US tech stocks and talk of imminent monetary easing by the Fed. Final Thoughts 1) It is important to note that round number syndrome and increased seismic activity near rounds number is a short-term phenomenon. Once the selling pressure is absorbed, the market resumes its movement based on other factors and develops independently of these already passed milestones. 2) Understanding the market behavior at round numbers can provide valuable information to investors. These round numbers act as psychological triggers for investors, driving their decision-making processes. 3) Understanding this phenomenon allows investors to make more informed choices and understand the short-term fluctuations that occur during these stages.
NASDAQ:NDXEducation
by Pandorra
👀 Three Black Crows. Bear Market Candlestick PatternThree Black Crows is a term used to describe a bearish candlestick pattern that can predict a reversal in an uptrend. Classic candlestick charts show "Open", "High", "Low" and "Close" prices of a bar for a particular security. For markets moving up, the candlestick is usually white, green or blue. When moving lower they are black or red. The Three Black Crows pattern consists of three consecutive long-body candles that opened with a gap above or inside the real body of the previous candle, but ultimately closed lower than the previous candle. Often traders use this indicator in combination with other technical indicators or chart patterns to confirm a reversal. Key points 👉 Three Black Crows is a Bearish candlestick pattern used to predict a reversal to a current uptrend, used along with other technical indicators such as the Relative Strength Index (RSI). 👉 The size of the Three black crow candles, timeframe they appeared on, the gaps when they opened, the downward progression sequence, as well as their shadows can be used to judge whether there is a risk of a pullback on a reversal. 👉 The “Three Black Crows” pattern should be considered finally formed after the sequential closure of all three elements included in it. 👉 The opposite pattern of three black crows is three white soldiers, which indicates a reversal of the downward trend. But maybe more about that another time. Explanation of the Three Black Crows pattern Three Black Crows is a visual pattern, which means there is no need to worry about any special calculations when identifying this indicator. The Three Black Crows pattern occurs when the bears outperform the bulls over three consecutive trading bars. The pattern appears on price charts as three bearish long candles with or without short shadows or wicks. In a typical Three Black Crows appearance, bulls start the time frame with the opening price or gap up, that is, even slightly higher than the previous close, but throughout the time frame the price declines to eventually close below the previous time frame's close. This trading action will result in a very short or no shadow. Traders often interpret this downward pressure, which lasted across three time frames, as the start of a bearish downtrend. Example of using Three black crows As a visual pattern, it is best to use the Three Black Crows as a sign to seek confirmation from other technical indicators. The Three Black Crows pattern and the confidence a trader can put into it depends largely on how well the pattern is formed. Three Black Crows should ideally be relatively long bearish candles that close at or near the lowest price for the period. In other words, candles should have long real bodies and short or non-existent shadows. If the shadows are stretching, it may simply indicate a slight change in momentum between bulls and bears before the uptrend reasserts itself. Using trading volume data can make the drawing of the Three Black Crows pattern more accurate. The volume of the last bar during an uptrend leading to the pattern is relatively lower in typical conditions, while the Three Black Crows pattern has relatively high volume in each element of the group. In this scenario, as in our case, the uptrend was established by a small group of bulls and then reversed by a larger group of bears. Of course, this could also mean that a large number of small bullish trades collide with an equal or smaller group of high volume bearish trades. However, the actual number of market participants and trades is less important than the final volume that was ultimately recorded during the time frame. Restrictions on the use of three black crows If the "Three Black Crows" pattern has already shown significant downward movement, it makes sense to be wary of oversold conditions that could lead to consolidation or a pullback before further downward movement. The best way to assess whether a stock or other asset is oversold is to look at other technical indicators, such as relative strength index (RSI), moving averages, trend lines, or horizontal support and resistance levels. Many traders typically look to other independent chart patterns or technical indicators to confirm a breakout rather than relying solely on the Three Black Crows pattern. Overall, it is open to some free interpretation by traders. For example, when assessing the prospects of building a pattern into a longer continuous series consisting of “black crows” or the prospects of a possible rollback. In addition, other indicators reflect the true pattern of the three black crows. For example, a Three Black Crows pattern may involve a breakout of key support levels, which can independently predict the start of a medium-term downtrend. Using additional patterns and indicators increases the likelihood of a successful trading or exit strategy. Real example of Three black crows Since there are a little more than one day left before the closing of the third candle in the combination, the candlestick combination (given in the idea) is a still forming pattern, where (i) each of the three black candles opened above the closing price of the previous one, that is, with a small upward gap, (ii ) further - by the end of the time frame the price decreases below the price at close of the previous time frame, (iii) volumes are increased relative to the last bullish time frame that preceded the appearance of the first of the “three crows”, (iv) the upper and lower wicks of all “black crows” are relatively short and comparable with the main body of the candle. Historical examples of the Three Black Crows pattern In unfavorable macroeconomic conditions, the Three Black Crows pattern is generally quite common. The weekly chart of the S&P500 Index (SPX) below, in particular, shows the occurrence of the pattern in the period starting in January 2022 and in the next 15 months until April 2023 (all crows combinations counted at least from 1-Month High). As it easy to notice, in each of these cases (marked on the graph below) after the candlestick pattern appeared, the price (after possible consolidations and rollbacks) tended to lower levels, or in any case, sellers sought to repeat the closing price of the last bar in series of the Three Black Crows candlestick pattern. Bottom Line 👉 As well as in usage of all other technical analysis indicators, it is important to confirm or refute its results using other indicators and analysis of general market conditions. 👉 Does History repeat itself? - Partially, yes.. it does. This is all because financial markets (as well as life) is not an Endless Rainbow, and after lovely sunny days, earlier or later, dark clouds may appear again, and again.
SP:SPXEducation
by Pandorra
How does inflation affect the stock market?The world’s financial environment has become incredibly tangled and multifaceted. The global availability of information to investors, particularly in rural areas, thanks to the internet, has caused investor sentiment to shift from an emotional response to an analysis and data-driven one. Inflation serves as a prime example of this. In the past, most individuals viewed inflation as an indication of an unhealthy economy. However, in the present day, investors have become more knowledgeable about economic cycles and are capable of making sound investment decisions at each stage of a country’s economy. Therefore, today, we will discuss inflation in general and evaluate its influence on the stock markets in India. Let’s start with a topic on How does inflation affect the stock market. What is Inflation? In simple words, inflation refers to the gradual increase in the prices of goods and services. As the inflation rate rises, so does the cost of living, resulting in a decrease in purchasing power. As an example, suppose bananas were priced at Rs.100 per kilo in 2010. In an inflationary economy, the cost of bananas would have increased by 2020. Let’s assume that the price of a Banana is now Rs.200 per kilo in 2020. Thus, in 2010, with Rs.1000, you could buy 10kg of Banana. However, in 2020, due to the decrease in purchasing power caused by inflation, you would only be able to buy 5kg of Bananas for the same amount. To understand inflation in detail, let’s have a look at what is the reason behind inflation. So, there are two major factors behind an increase in the rate of inflation in the economy. 1) Demand > Supply One reason for an increase in the inflation rate is when the average income of individuals in an economy rises, and they want to purchase more goods and services. During such times, the demand for these products and services can exceed their supply, resulting in a scarcity of these goods and services. Consequently, buyers are willing to pay more for them, which leads to a general increase in prices. 2) Increase in the cost of production Another reason for an increase in the inflation rate is when the cost of production of goods and services increases due to an increase in the costs of raw materials, labour, taxes, etc. While this leads to an increase in the cost of production, it also causes a decrease in the supply of these goods and services. With the demand remaining constant, the prices tend to increase. Inflation and the Indian Stock Markets: The price of a share in the stock markets is determined by the interplay of demand and supply, which is influenced by a variety of factors, including social, political, economic, cultural, and so on. Anything that affects investors can have an impact on the demand and supply of stocks, and inflation is no exception. Here is a brief overview of the impact of inflation on stock markets: 1. The Purchasing Power of Investors Inflation, by definition, is a rise in the prices of goods and services, and it is also an indicator of the diminishing value of money. Therefore, if the inflation rate is 5%, then Rs.10, 000 today will be worth Rs.9, 500 after one year. If the inflation rate increases to 10%, then the same amount will be worth even less in the future. So, as the inflation rate increases, the purchasing power of investors decreases. This decrease in purchasing power can directly impact the stock market since investors would be able to purchase fewer stocks for the same amount. 2. Interest Rates When the inflation rate rises, the Reserve Bank of India ( RBI ) often increases interest rates for deposits and loans. This move is intended to encourage people to save money and limit excess liquidity, thereby reducing the inflation rate. However, as loans become more expensive, the cost of capital for companies also increases. Consequently, the projected cash flows of companies are valued lower, which can lead to lower equity valuations. 3. Impact on Stocks As the increase in the inflation rate, speculation about the future prices of goods and services can create a highly volatile market environment. Since prices are rising, many investors may speculate that companies will experience a drop in profitability. As a result, some investors might decide to sell their shares, leading to a drop in their market price. However, other investors who remain optimistic about the company’s future profitability may continue to buy these stocks, which can create a volatile environment in the stock market. Value stocks tend to perform well during times of inflation because they are often more established companies with stable earnings and a history of paying dividends, making them more attractive to investors seeking steady returns. In contrast, growth stocks are often newer companies with higher potential for future earnings, but they may not have established cash flows to support their valuations. When inflation rises, investors may become more risk-averse and prioritize stable, predictable returns over potential growth, leading to a decline in demand for growth stocks and a corresponding drop in their market prices. 4. Long-term benefits of increasing inflation rates on stock markets A certain level of inflation is required for an economy to grow, as it encourages spending and investment. A moderate and controlled rise in inflation rates can lead to an increase in the income of the people and help in boosting the economy. However, if the inflation rate goes beyond a certain limit, it can have a negative impact on the economy. Therefore, it is crucial to maintain a balance between inflation and economic growth. Conclusion: Investors should analyse the trend of inflation rates in recent years before making any investment decisions. Sudden spikes in inflation rates may cause uncertainty and volatility in the stock markets, while a gradual and steady rise in inflation rates can provide a conducive environment for businesses to grow and expand, leading to higher stock valuations. Additionally, investors should consider investing in sectors that perform well in an inflationary environment, such as energy, commodities, and real estate. ___________________________ 💻📞☎️ always do your research. 💌📫📃 If you have any questions, you can write me in the comments below, and I will answer them. 📊📌❤️And please don't forget to support this idea with your likes and comment
NSE:TCSEducation
by khushaljain023
🐱‍🐉 The Magnificent, One and Only Million Million OpportunityAs we approach the end of 2023, we are just a short time away from the 1st anniversary of the AI research company ChatGPT's chatbot being launched on November 30, 2022. This publication, although dedicated to a single company - Microsoft Corporation - is educational in nature, and is a representation of a letter to shareholders - 2023 by Satya Nadella, Chairman and CEO of Microsoft Corporation NASDAQ:MSFT - the second company in the world after Apple in terms of market capitalization. I hope that each of you will be able to master it, look back, and realize what a rapidly changing world we all live in now. Enjoy! October 16, 2023 Dear shareholders, colleagues, customers, and partners: We are living through a time of historic challenge and opportunity. As I write this, the world faces ongoing economic, social, and geopolitical volatility. At the same time, we have entered a new age of AI that will fundamentally transform productivity for every individual, organization, and industry on earth, and help us address some of our most pressing challenges. This next generation of AI will reshape every software category and every business, including our own. Forty-eight years after its founding, Microsoft remains a consequential company because time and time again—from PC/Server, to Web/Internet, to Cloud/Mobile—we have adapted to technological paradigm shifts. Today, we are doing so once again, as we lead this new era. Amid this transformation, our mission to empower every person and every organization on the planet to achieve more remains constant. As a company, we believe we can be the democratizing force for this new generation of technology and the opportunity it will help unlock for every country, community, and individual, while mitigating its risks. Here are just a few examples of how we are already doing this: • Leading electronic health records vendor Epic is addressing some of the biggest challenges facing the healthcare industry today—including physician burnout—by deploying a wide range of copilot solutions built on Azure OpenAI Service and Dragon Ambient eXperience Copilot. • Mercado Libre is reducing the time its developers spend writing code by more than 50 percent with GitHub Copilot, as the company works to democratize e-commerce across Latin America. •Mercedes-Benz is making its in-car voice assistant more intuitive for hundreds of thousands of drivers using ChatGPT via the Azure OpenAI Service. • Lumen Technologies is helping its employees be more productive, enabling them to focus on higher value-added activities, by deploying Microsoft 365 Copilot. • Nonprofit The Contingent is matching foster families with children in need using Dynamics 365, Power BI, and Azure, with an eye on using AI to amplify its work across the US. • And, Taiwan’s Ministry of Education has built an online platform to help elementary and high school students learn English using Azure AI. To build on this progress, we remain convicted on three things: First, we will maintain our lead as the top commercial cloud while innovating in consumer categories, from gaming to professional social networks. Second, because we know that maximum enterprise value gets created during platform shifts like this one, we will invest to accelerate our lead in AI by infusing this technology across every layer of the tech stack. And, finally, we will continue to drive operating leverage, aligning our cost structure with our revenue growth. As we make progress on these priorities, we delivered strong results in fiscal year 2023, including a record $211 billion in revenue and over $88 billion in operating income. A NEW ERA OF AI There are two breakthroughs coming together to define this new era of AI. • The first is the most universal interface: natural language. The long arc of computing has, in many ways, been shaped by the pursuit of increasingly intuitive human-computer interfaces—keyboards, mice, touch screens. We believe we have now arrived at the next big step forward—natural language—and will quickly go beyond, to see, hear, interpret, and make sense of our intent and the world around us. • The second is the emergence of a powerful new reasoning engine. For years, we’ve digitized daily life, places, and things and organized them into databases. But in a world rich with data, what has been most scarce is our ability to reason over it. This generation of AI helps us interact with data in powerful new ways—from completing or summarizing text, to detecting anomalies and recognizing images—to help us identify patterns and surface insights faster than ever. Together, these two breakthroughs will unlock massive new opportunity. And, in fact, just last month we announced our vision for Copilot, an everyday AI companion. We are building Copilot into all our most used products and experiences and allowing people to summon its power as a standalone app as well. Just like you boot up an OS to access applications or use a browser to visit websites today, our belief is that you will invoke a Copilot to do all those activities and more: to shop, to code, to analyze, to learn, to create. As a company, any time we approach a transition like this, we do so responsibly. We believe AI should be as empowering across communities as it is powerful, and we’re committed to ensuring it is responsibly built and designed, with safety in mind from the outset. OUR OPPORTUNITY Every customer solution area and every layer of our tech stack will be reimagined for the AI era. And that’s exactly what we’ve already begun to do: Infrastructure Four years ago, we first invested in our AI supercomputer, with a goal of building the best cloud for training and inference. Today, it’s being used by our partner OpenAI to power its best-in-class foundation models and services, including one of the fastest-growing consumer apps ever—ChatGPT. NVIDIA, as well as leading AI startups like Adept and Inflection, is also using our infrastructure to build its own breakthrough models. More broadly, organizations continue to choose our ubiquitous computing fabric—from cloud to edge—to run their mission-critical applications. We continued to see more cloud migrations to Azure this past fiscal year, as it remains early when it comes to the long-term cloud opportunity. And we also continue to lead in hybrid computing with Azure Arc, which now has 18,000 customers. Data and AI Every AI app starts with data, and having a comprehensive data and analytics platform is more important than ever. Our Intelligent Data Platform brings together operational databases, analytics, and governance so organizations can spend more time creating value and less time integrating their data estate. We also introduced Microsoft Fabric this year, which unifies compute, storage, and governance with a disruptive business model. With Azure AI, we are making foundation models available as platforms to our customers. We offer the best selection of industry-leading frontier and open models. In January, we made the Azure OpenAI Service broadly available, bringing together advanced models, including ChatGPT and GPT-4, with the enterprise capabilities of Azure. More than 11,000 organizations across industries are already using it for advanced scenarios like content and code generation. Meta chose us this summer as its preferred cloud to commercialize its Llama family of models. And, with Azure AI Studio, we provide a full lifecycle toolchain customers can use to ground these models on their own data, create prompt workflows, and help ensure they are deployed and used safely. Digital and app innovation GitHub Copilot is fundamentally transforming developer productivity, helping developers complete coding tasks 55 percent faster. More than 27,000 organizations have chosen GitHub Copilot for Business, and to date more than 1 million people have used GitHub Copilot to code faster. We also announced our vision for the future of software development with GitHub Copilot X, which will bring the power of AI throughout the entire software development lifecycle. All up, GitHub surpassed $1 billion in annual recurring revenue for the first time this fiscal year. We’re also applying AI across our low-code/no-code toolchain to help domain experts across an organization automate workflows, create apps and webpages, build virtual agents, or analyze data, using just natural language with copilots in Power Platform. More than 63,000 organizations have used AI-powered capabilities in Power Platform to date. Business applications We are bringing the next generation of AI to employees across every job function and every line of business with Dynamics 365 Copilot, which works across CRM and ERP systems to reduce burdensome tasks like manual data entry, content generation, and notetaking. In fact, our own support agents are using Copilot in Dynamics 365 Customer Service to resolve more cases faster and without having to call on peers to help. With our Supply Chain Platform, we’re helping customers apply AI to predict and mitigate disruptions. And, with our new Microsoft Sales Copilot, sellers can infuse their customer interactions with data from CRM systems—including both Salesforce and Dynamics—to close more deals. All up, Dynamics surpassed $5 billion in revenue over the past fiscal year, with our customer experience, service, and finance and supply chain businesses each surpassing $1 billion in annual sales. Industry Across industries, we are rapidly becoming the partner of choice for any organization looking to generate real value from AI. In healthcare, for example, we introduced the world’s first fully automated clinical documentation application, DAX Copilot. The application helps physicians reduce documentation time by half, freeing them to spend more time face to face with patients. And Epic will integrate it directly into its electronic health records system. And, in retail, we introduced new tools to help companies manage their day-to-day operations and digitize their physical stores. Modern work We are rapidly evolving Microsoft 365 into an AI-first platform that enables every individual to amplify their creativity and productivity, with both our established applications like Office and Teams, as well as new apps like Designer, Stream, and Loop. Microsoft 365 is designed for today’s digitally connected, distributed workforce. This year, we also introduced a new pillar of customer value with Microsoft 365 Copilot, which combines next-generation AI with business data in the Microsoft Graph and Microsoft 365 applications to help people be more productive and unleash their creativity at work. Just last month, I was excited to announce that we will make Microsoft 365 Copilot generally available to our commercial customers later this year. We continue to build momentum in Microsoft Teams across collaboration, chat, meetings, and calls. We introduced a new version of Teams that delivers up to two times faster performance, while using 50 percent less memory. We also introduced Teams Premium to meet enterprise demand for AI-powered features like intelligent meeting recaps. All up, Teams usage surpassed 300 million monthly active users this year. With Microsoft Viva, we have created a new category for employee experience. Copilot in Viva offers leaders a new way to build high-performance teams by prioritizing both productivity and employee engagement. This year, Viva surpassed 35 million monthly active users. Security As the rate and pace of cyberthreats continue to accelerate, security is a top priority for every organization. Our comprehensive, AI-powered solutions give defenders the advantage. With Security Copilot, we’re combining large language models with a domain-specific model informed by our threat intelligence and 65 trillion daily security signals, to transform every aspect of security operations center productivity. All up, more than 1 million organizations now count on our comprehensive, AI-powered solutions to protect their digital estates, and our security business surpassed $20 billion in annual revenue, as we help protect customers across clouds and endpoint platforms. Search, advertising, and news We are reshaping daily search and web habits with our new Bing and Microsoft Edge browser, which brings together search, browsing, chat, and AI into one unified experience to deliver better search, more complete answers, a new chat experience, and the ability to generate content. We think of these tools as an AI copilot for the web. We are also bringing these breakthrough capabilities to businesses, with Bing Chat Enterprise, which offers commercial data protection, providing an easy on-ramp for any organization looking to get the benefit of next-generation AI today. Although it’s early in our journey, Bing users engaged in more than 1 billion chats and created more than 750 million images over the past year as they apply these new tools to get things done. And Edge has taken share for nine consecutive quarters. More broadly, we continue to expand our opportunity in advertising. This year, Netflix chose us as its exclusive technology and sales partner for its first ad-supported subscription offering, a validation of the differentiated value we provide to any publisher looking for a flexible partner to build and innovate with them. LinkedIn The excitement around AI is creating new opportunities across every function—from marketing, sales, service, and finance, to software development and security. And LinkedIn is increasingly where people are going to learn, discuss, and uplevel their skills. We are using AI to help our members and customers connect to opportunities and tap into the experiences of experts on the platform. In fact, our AI-powered articles are already the fastest-growing traffic driver to the network. All up, LinkedIn’s revenue surpassed $15 billion for the first time this fiscal year, a testament to how mission critical the platform has become to help more than 950 million members connect, learn, sell, and get hired. Gaming In gaming, we are rapidly executing on our ambition to be the first choice for people to play great games whenever, wherever, and however they want. With Xbox Game Pass, we are redefining how games are distributed, played, and viewed. Content is the flywheel behind the service’s growth, and our pipeline has never been stronger. It was especially energizing to release Starfield this fall to broad acclaim, with more than 10 million players in the first month post-launch alone. Earlier this month, we were thrilled to close our acquisition of Activision Blizzard, and we look forward to sharing more in the coming months about how, together , we will bring the joy of gaming to more people around the world. Devices and creativity Finally, we’re turning Windows into a powerful new AI canvas with Copilot, which rolled out as part of a Windows 11 update last month. It uniquely incorporates the context and intelligence of the web, your work data, and what you are doing in the moment on your PC to provide better assistance, while keeping your privacy and security at the forefront. Overall, the number of devices running Windows 11 more than doubled in the past year. And we are also transforming how Windows is experienced and managed with Azure Virtual Desktop and Windows 365, which together surpassed $1 billion in annual revenue for the first time. OUR RESPONSIBILITY As we pursue our opportunity, we are also working to ensure technology helps us solve problems—not create new ones. To do this, we focus on four enduring commitments that are central to our mission and that take on even greater importance in this new era. For us, these commitments are more than just words. They’re a guide to help us make decisions across everything we do—as we design and develop products, shape business processes and policies, help our customers thrive, build partnerships, and more —always asking ourselves critical questions to ensure our actions are aligned with them. How can we expand opportunity? First, we believe access to economic growth and opportunity should reach every person, organization, community, and country. And although AI can serve as a catalyst for opportunity and growth, we must first ensure everyone has access to the technologies, data, and skills they need to benefit. To achieve this, we are focused on getting technology into the hands of nonprofits, social entrepreneurs, and other civil society organizations to help them digitally transform, so they can help address some of society’s biggest challenges. This year, we provided nonprofits with over $3.8 billion in discounted and donated technology. Nearly 325,000 nonprofits used our cloud. And to help them tap the potential of AI, we’re building new AI capabilities for fundraising, marketing, and program delivery. AI will displace some jobs, but it will also create new ones. That’s why we aim to train and certify 10 million people by 2025 with the skills for jobs and livelihoods in an increasingly digital economy. Since July 2020, we’ve helped 8.5 million people, including 2.7 million this year. We’ve also focused on skilling women and underrepresented communities in cybersecurity, working across 28 countries and with nearly 400 US community colleges to scale our efforts. Finally, to help people learn more about AI, we launched the first online Professional Certificate on Generative AI in partnership with LinkedIn Learning, created AI tools for educators, and held our first AI Community Learning event in the US. These events will be replicated around the world and localized in 10 languages over the next year. We also partnered to launch a Generative AI Skills Grant Challenge to explore how nonprofit, social enterprise, and research or academic institutions can empower the workforce to use this new generation of AI. How can we earn trust? To create positive impact with technology, people need to be able to trust the technologies they use and the companies behind them. For us, earning trust spans the responsible use of AI, protecting privacy, and advancing digital safety and cybersecurity. Our commitment to responsible AI is not new. Since 2017, we’ve worked to develop our responsible AI practice, recognizing that trust is never given but earned through action. We have translated our AI principles into a core set of implementation processes, as well as tools, training, and practices to support compliance. But internal programs aren’t enough. We also enable our customers and partners to develop and deploy AI safely, including through our AI customer commitments and services like Azure AI Studio, with its content safety tooling and access to our Responsible AI dashboard. Building AI responsibly requires that we work with other industry leaders, civil society, and governments to advocate for AI regulations and governance globally. This year, we released our Governing AI Blueprint, which outlines concrete legal and policy recommendations for AI guardrails. We are signatories to the eight voluntary commitments developed with the US White House, and proud of the six additional commitments we’ve made to further strengthen and operationalize the principles of safety, security, and trust. The era of AI heightens the importance of cybersecurity, and we deepened our work across the private and public sectors to improve cyber-resilience. We’ve continued to support Ukraine in defending critical infrastructure, detecting and disrupting cyberattacks and cyberinfluence operations, and providing intelligence related to these attacks. Our Microsoft Threat Analysis Center team produced more than 500 intelligence reports to help keep customers and the public informed. And we published our third annual Microsoft Digital Defense Report, sharing our learnings and security recommendations. We also remain committed to creating safe experiences online and protecting customers from illegal and harmful content and conduct, while respecting human rights. We supported the Christchurch Call Initiative on Algorithmic Outcomes to address terrorist and violent and extremist content online. And through the World Economic Forum’s Global Coalition for Digital Safety, we co-led the development of new global principles for digital safety. Protecting customers’ privacy and giving them control of their data is more important than ever. We’ve begun our phased rollout of the EU Data Boundary, supporting our commercial and public sector customers’ need for data sovereignty. And each month, more than 3 million people exercise their data protection rights through our privacy dashboard, making meaningful choices about how their data is used. How can we protect fundamental rights? In an increasingly digital world, we have a responsibility to promote and protect people’s fundamental rights and address the challenges technology creates. For us, this means upholding responsible business practices, expanding connectivity and accessibility, advancing fair and inclusive societies, and empowering communities. In 2023, we worked diligently to anticipate harmful uses of our technology and put guardrails on the use of technologies that are consequential to people’s lives or legal status, create risk of harm, or threaten human rights. We will continue to assess the impact of our technologies, engage our stakeholders, and model and adopt responsible practices and respect for human rights—including across our global supply chain. Today, our lives are more connected than ever. Access to education, employment, healthcare, and other critical services is increasingly dependent on technology. That’s why we’ve expanded our commitment to bring access to affordable high-speed internet to a quarter of a billion people around the world, including 100 million people in Africa, by the end of 2025. Since 2017, we’ve helped bring internet access to 63 million people, a key first step to ensuring communities will have access to AI and other digital technologies. This year, we also continued working toward our five-year commitment to bridge the disability divide with a focus on helping close the accessibility knowledge gap. Seven hundred and fifty-thousand learners enriched their understanding of disability and accessibility in partnership with LinkedIn Learning, Teach Access, and the Microsoft disability community. In addition, we’re stepping up efforts to combat online disinformation through new media content provenance technologies—enabling users to verify if an image or video was generated by AI. We continued our efforts to promote racial equity across Microsoft, our ecosystem, and our communities, including our work to advance justice reform through data-driven insights. And we provided support in response to eight humanitarian disasters, including committing $540 million of support to those who have been impacted by the War in Ukraine. Finally, recognizing AI’s potential to advance human rights and humanitarian action, we worked on several AI for Humanitarian Action projects. Together with our partners, we’re building the capabilities to identify at-risk communities, estimate seasonal hunger, predict malnutrition, and assist in disease identification. How can we advance sustainability? Climate change is the defining issue of our generation, and addressing it requires swift, collective action and technological innovation. We are committed to meeting our own goals while enabling others to do the same. That means taking responsibility for our operational footprint and accelerating progress through technology. We continue to see extreme weather impacting communities globally. To meet the urgent need, this must be a decade of innovation and decisive action—for Microsoft, our customers, and the world. In our latest Environmental Sustainability Report, we shared our progress toward our 2030 sustainability targets across carbon, water, waste, and ecosystems. In 2022, our overall carbon emissions declined by 0.5 percent while our business grew. Addressing scope 3 emissions, which account for the vast majority of our emissions, is arguably our ultimate challenge—one we’ll continue to tackle through our supply chain, policy advances, and industry-wide knowledge-sharing. We’ve provided just under 1 million people with access to clean water and sanitation, one of five pillars on our path to becoming water positive. And in our pursuit to be zero waste, we achieved a reuse and recycle rate of 82 percent for all our cloud hardware and diverted over 12,000 metric tons of solid operational waste from landfills and incinerators. We also continue to take responsibility for the impacts of our direct operations on Earth’s ecosystems. We’ve contracted to protect 17,268 acres of land, over 50 percent more than the land we use to operate. Of that, 12,270 acres—the equivalent of approximately 7,000 soccer fields—were designated as permanently protected. Technology is a powerful lever to help us avoid the most severe impacts of climate change. That’s why we’re accelerating our investment in more efficient datacenters, clean energy, enhancements to the Microsoft Cloud for Sustainability and Planetary Computer, and green software practices. To date, through our Climate Innovation Fund, we’ve allocated more than $700 million to a global portfolio of 50+ investments spanning sustainable solutions in energy, industrial, and natural systems. Finally, we believe AI can be a powerful accelerant in addressing the climate crisis. We expanded our AI for Good Lab in Egypt and Kenya to improve climate resilience for the continent. And, together with our partners, we launched Global Renewables Watch, a first-of-its-kind living atlas that aims to map and measure utility-scale solar and wind installations, allowing users to evaluate progress toward a clean energy transition. Although this new era promises great opportunity, it demands even greater responsibility from companies like ours. As we pursue our four commitments, we focus on transparency—providing clear reporting on how we run our business and how we work with customers and partners. Our annual Impact Summary shares more about our progress and learnings this year, and our Reports Hub provides detailed reports on our environmental data, political activities, workforce demographics, human rights work, and more. OUR CULTURE There’s never been a more important time to live our culture. The way we work and the speed at which we work are changing. In an economy where yesterday’s exceptional is today’s expected, all of us at Microsoft will need to embrace a growth mindset and, more importantly, confront our fixed mindsets as our culture evolves. It will take everyday courage to reformulate what innovation, business models, and sales motions look like in this new era. As a high-performance organization, we aspire to help our employees maximize their economic opportunity, while simultaneously helping them learn and grow professionally and connect their own passion and purpose with their everyday work and the company’s mission. To be successful, we need to be grounded in what our customers and the world need. We need to innovate and collaborate as One Microsoft. And we need to actively seek diversity and embrace inclusion to best serve our customers and create a culture where everyone can do their best work. To empower the world, we need to represent the world. To that end, we remain focused on increasing representation and strengthening our culture of inclusion. Even as we navigated challenges this year, our company continued to be the most globally diverse it’s ever been. Giving also remains core to our culture. This year, more than 105,000 employees gave $242 million (including company match) to over 35,000 nonprofits in 116 countries. And our employees volunteered over 930,000 hours to causes they care about. I am deeply grateful to our employees for their commitment to the company and their communities, and how they are living our mission and culture every day in a changing company and world. ** In closing, this is Microsoft’s moment. We have an incredible opportunity to use this new era of AI to deliver meaningful benefits for every person and every organization on the planet. On New Year’s Day, I saw a tweet from Andrej Karpathy, Tesla’s former director of AI who now works at OpenAI, about how GitHub Copilot was writing about 80 percent of his code, with 80 percent accuracy. Two days later, I saw a stunning example of work we’ve done with the government of India’s Ministry of Electronics and IT, which is applying an AI model so farmers in rural areas can interact with government resources in their native languages. Think about that: A foundation model that was developed on the West Coast of the United States is already transforming the lives of both elite developers and rural farmers on the other side of the globe. We’ve not seen this speed of diffusion and breadth of impact in the tech industry before. As a company, this is our moment to show up and responsibly build solutions that drive economic growth and benefit every community, country, industry, and person. If we do it well, the world will do well, and Microsoft will do well too. I’ve never been more confident that we will deliver on this promise together in the days, months, and years to come. Satya Nadella Chairman and Chief Executive Officer Thanks for reading. I hope the publication was useful and interesting for you. @Pandorra 😎
NASDAQ:MSFTEducation
by Pandorra
HOW-TO Discover and Harness the Potential of the Dividend MarketDividend Market as well as Dividend futures trading shines bright, in accordance with CME Group @CME_Group Q3'23 Equity Insights Report. Dividend futures combined Q3 ADV reached 5.1K contracts, and OI averaged 284K contracts (+5% vs. Q2 2023). Over 77K contracts have traded since the launch of Annual Dividend Index futures on Nasdaq-100 NASDAQ:NDX and Russell 2000 TVC:RUT , which allow market participants increased options to manage U.S. dividend risk, especially as year end approaches. Understanding Dividends and Dividend Market 👉 A dividend is the distribution of corporate earnings to eligible shareholders. 👉 Dividend payments and amounts are determined by a company's board of directors. Dividends must be approved by the shareholders by voting rights. Although cash dividends are common, dividends can also be issued as shares of stock. 👉 The dividend yield is the dividend per share, and expressed as a percentage of a company's share price. 👉 Many companies - constituents of S&P500 Index DO NOT PAY dividends and instead retain earnings to be invested back into the company. 👉 The S&P500 Dividend Points Index (Annual) tracks the total dividends from the constituents of the S&P 500 Index. The index provides investors the opportunity to hedge or take a view on dividends for U.S. stocks, independent of price movement. The index resets to zero on an annual basis. 👉 Using the S&P500 Dividend Point Index (Annual) as the underlying in financial products, investors can hedge or gain exposure to the dividend performance of the S&P500 Index. Representation of S&P500 Dividend Points Index (Annual) over the past 5 years. Dividends points are to be collected through the calendar year, and reset to Zero on an annual basis Understanding S&P500 Annual Dividend Index Futures 👉 The S&P500 Annual Dividend Index futures CME:SDA1! calculates the accumulation of all ordinary gross dividends paid on the S&P500 index constituent stocks that have gone ex-dividend over a 12-month period. The amounts are expressed as dividend index points. 👉 The underlying index for S&P500 Annual Dividend Index futures is the S&P500 Dividend Index. The methodology for the index can be found here at S&P Global website. 👉 Dividend index points specifically refer to the level of index points that are directly attributable to the dividends of index constituents. They typically only capture regular dividends and calculate this on the ex-date of the respective constituents within each index. 👉 In general, “special” or “extraordinary” dividends are not included as dividend points in the respective annual dividend indices. 👉 Futures contract Unit is $ 250 x S&P 500 Annual Dividends Index. The Universe of S&P500 Annual Dividend Index futures with expirations dates over the next several years Understanding the Difference between 'Today' and 'Tomorrow' using S&P500 Annual Dividend Index Futures, or what is CME:SDA1! and CME:SDA2! Futures contracts 👉 CME:SDA1! is a Front S&P500 Annual Dividend Index futures contracts, that calculates expected dividend index points for current (in this time - 2023) calendar year. 👉 CME:SDA2! is a Next one S&P500 Annual Dividend Index futures contracts, that calculates expected dividend index points for the next one (in this time - 2024) calendar year. 👉 The difference (futures spread) between front and next one can give an expression to traders and investors. 👉 Macro conditions are good, and U.S. economy is doing well, so futures spread values are below Zero (expected dividend points for next year are bigger rather current). 👉 Macro conditions are bad and U.S. economy is getting worst, so futures spread values are above Zero (expected dividend points for next year are lower rather current). 🤝 Happy Dividend Market Trading to Everyone! Enjoy!
SEducation
by Pandorra
#TradingViewPAY HOW TO EARN 💲💲 BY BECOME THE BEST AUTHOR ON TVGet rewarded for your ideas and scripts! A month earlier, on the 20th of May, Tradingview introduced its new Rewards Program . Sharing is powerful, right!? The TradingView community thrives on fantastic members who share their knowledge, experience, successes and sometimes even their failures. Interaction, open discussion and self-expression are the keys to understanding. In the spirit of sharing, the TradingView team, believing it is fair that outstanding contributions are rewarded, has decided to thank their dedicated contributors. The TradingView Wizards program was recently launched to bring out the real wizards. Inspired by this, TradingView has also launched a new pilot program that rewards authors whose ideas and scripts appear in the Editors' Choice section. In the event that your idea or scenario becomes an Editors' Choice, your work will not only be featured to the entire TradingView community, but you will also receive a cool $100! If several of your publications are selected during the month, you will be charged for each. Learn more about the program and its terms and conditions in this Help Center article . This pilot program is just the first step towards content monetization. TradingView promises to keep adding new ways to motivate great creators to enrich the community. At the first stage, authors are rewarded for those ideas and scenarios that have become "Editor's Choice" in the international part of the TradingView community (only in English). TradingView promises to tweak the features of the program and aspects of the program are subject to change as improvements are made to benefit our community! I must confess on my own behalf that the TradingView Editors Team has A REALLY VERY GOOD TASTE. For all the time I spent on the TradingView website (that is almost eight years), I have become the author of more than 300 publications, and the best of them have rightfully become to an "Editors' Choice" column. And so, just literally two months earlier, in April 2023, two of my publications became "Editor's Choice" again, in the international part of the TradingView community (in English). The first one is 😀 SVB Crisis Is Over?! What S&P500 and VIX Are Talking About was dedicated to the US S&P500 index SP:SPX , while the market began to show the first signs that the Silicon Valley banking crisis was over. More details can be found on the publication page . In the second publication - Occidental Petroleum Corp.: Bullish Bias. Continuation I've considered with technical aspects and opportunities of Value Investment Assets. Incl. NYSE:OXY - one of the legendary 92-year-old American investor Warren Buffett favorites, Occidental Petroleum corp. More details can be found on the publication page . While expressing many words of gratitude to the TradingView team, I must admit that the EP selection of mentioned above publications in April to the "Editor's Choice" was a pleasant surprise for me. As well as the launch of the #TradingViewPAY motivational Program a month later, the effect of which is extended to all the ideas and scenarios that have become "Editor's Choice" starting from the second quarter of 2023! Proves and Screenshots!? - Yes, please! Everything is 100 DOLLARS working! ✨💖 Dare you too! Post your best ideas and scripts! And may the reward find the best of you! -- Watch first, then share! TradingView FEAT Pandorra 💖
BINANCE:BTCUSDEducation
by Pandorra
Why we should review price action to see if History will RepeatStudying price action and reviewing should be a key part to everyones trading and will improve overall results. Many Stocks, Currency pairs, Commodities or Indexes have differing nuances and characteristics with regards to Price Action so it is worth doing the homework before entering a trade. Even though they all trade around a similar Price Action Framework, quickly looking for small repeating patterns can greatly improve the probability and conviction and help your trades in the long run. This short video looks EQR.asx which is a share listed on the ASX. By reviewing the previous price action, we can see that the current setup is so far following the same path as a previous big winner....I will be watching to see if history does repeat!! Hope you enjoy
Editors' picks
EEducation
by TradeTheStructure
5
How occur the House Debt Bubble on 2008I'm watching the past how occur the House Debt Bubble on 2008 in the Real State Housing in America. This it's S&P 500 how this economic indicator behavior during the year 2008-2009 into this worse financial crisis in North America. So, I want to share our present situation what the S&P it's behavior now: Ok, we're in the possible bubble financial in this high point as we forming a higher low in the market structure indicating weak in the trend. Now, if I see that S&P 500 break down the EMA 200 and make a resistance pull back below of the EMA 200, this will be the beginning of the death cross in the stock market and market crash entering in the bubble financial. Ok, and now we're going to discuss How the S&P 500 behavior in the past? 1) We see a very similar patron formed in our present. 2) We see a higher low formed in the past indicating weak in the trend, and the recently market structure a market trap that I see in our present 3) When break down the EMA 200 and make this pull back below of the EMA 200, the financial market began their bubble financial on 2008 and crash of the financial market. At the moment, we see the 2 criteria confirmed, and we could to entry in the exactly moment of market trap developing now. So guys, if you want to read about how this House Debt Bubble occur on 2008, there're a lot educational content in You Tube, documental, wikipedia or blog to read and watching this past history that look very interesting to understand how this occur, the history it's very extensive to post it here. Also, there a lot content to check out in internet, and also, I suggsted to study and watch the 2 bubble in our history 1) "Crack of 29", called the bubble financial on 1929, the most famous oil financial crisis in the worldwide occur in America in the century XX. 2) House Debt bubble on 2008, called the Real State Housing crisis in America that made an deep impact in the financial market and one of the worse bubble in the history of the humanity. I hope that this content educational support you
SP:SPXEducation
by harisonhbn9718
2
HOW TO CATCH & RIDE MULTIBAGGERSHello traders! This stock has given 37x in just 5 months in its previous move which was the 1st move. Again it has close above 50ma ,20ma and 6ma after bouncing from its previous support or demand zone at 113. We can take entry at cmp with proper position sizing as the risk here is approx. 35%. To catch multibagger stocks we have to take that risk with proper sizing to deal with the fear in trading. Stoploss should be kept below the previous support of 95 below weekly closing. Targets are mentioned in the chart clearly. It can go up to 22x. NOTE : Once we achieve the 1st target of 100%, we have to book 50% of our total position and forget the 50% for investment purpose. That is the funda of catching multibagger stocks. DISCLAIMER: This analysis is for sharing my views and not be considered as trading recommendation.
NSE:JITFINFRAEducation
by Cruoso4u
Can you stomach a 20% drop in the SPX? I start off by stating that I do not actively trade in indexes but would like to share my thoughts on SPX similar to what I did with DJIA. The SPX has had an incredible run since March 2020 (2194) to the high of 4808 made at the beginning of the year. What were the reasons for this? 1) Low to no interest policy of the FED 2) Optimism of recovery from Covid and vaccine discovery. 3) Free money being available and a lot of amateur traders getting into the market This Index however has run out of steam. Technically speaking, there are massive reversal signs that are in play since May 2021. 1) Weekly Overbought on RSI 2) RSI Divergence on the weekly chart 3) Head and shoulders pattern complete On a fundamental side we have: 1) Interest rate increase to combat inflation 2) The China lockdown 3) An energy crisis 4) The sad invasion of Ukraine The year long consolidation between 4500-4800 is a dire warning that the market is in consolidation for a big move. It is very unlikely to be up and we are looking at the initial levels of 3400. If the consolidation lasts for a few months, these levels will not hold and we will see a bigger drop. There is no timeline on the weekly chart, but let's revisit this chart in July, October 2022 and January 2023 to see where the market is at.
SP:SPXEducation
by JD_TeenTrader
2
Steps to invest successfully #2Hello everyone, During this video we are going to analyse the following subjects: - Look at the bigger picture. - Draw trend lines using the most significant lows/highs. - Look for support and resistance. - Look for candles. - Understand where the stock/coin sits now. - Reasonably predict where the stock/coin will be in the future. - Make sure you are using EMA lines. - When and why placing your stop loss is important. - Pivot point. Remember, you will never be right every time. However, the key factor is to limit your risk by buying close to support. Seb.
Education
by michael772
Seasonal Futures Trading Patterns S&P 500 Hey traders today I wanted to go over what I believe are the best Seasonal Futures and Forex trades during the year. There are many markets that have seasonal patterns. Such as Forex, Stocks, Futures, and Commodities. Knowing the best time to trade to look for these Seasonal Futures and Forex opportunities will help you in your trading. This series on Seasonal Futures and Forex will be ongoing with several videos. The first video will be about the S&P 500 futures and how to trade them seasonally. Enjoy! Trade Well, Clifford
CME_MINI:MES1!Education
by TradeTheIndex
Why the S&P500 Micro Futures is one of the best markets to trade Hey Traders so today I wanted to show you a great market to consider trading the S&P500 Micro Futures. I think it is one of the easiest markets to learn vs the Forex and others. It offers great leverage and really good risk vs reward. Of course futures are different from stocks, crypto and forex. The are considered high risk because of the volatility and leverage. But definitely I think they are a good asset class to consider adding to every traders portfolio with the right risk management. Plus this market is a great way to start capturing all the great gains that the stock market has had in the last 10 years. As long as the bull market continues I think this market will remain strong. Enjoy! Trade Well, Clifford
CME_MINI:MESU2021Education
by TradeTheIndex
How The Economy Affects The Stock Market ? How The Economy Affects The Stock Market ? There are many factors that affect how the stock market is doing, and whether it’s moving up or down: the political climate, social factors, interest rates, trends and shifts in what investors prefer. So how does the economy affect the stock market? If the general population feels as if the economy will soon be taking a turn for the worse, they tend to sell stock because bonds and treasuries offer a safer return. On the flip side, when people are feeling confident and optimistic about the economy, they tend to buy stock, taking more risk for greater reward. From a high-level approach, when people feel good about the economy, they tend to buy more stock. When things are happening in the world make them feel unsure, they will be more conservative, and might gravitate toward lower-risk investments such as bonds and Treasury bills. .
NSE:NIFTYEducation
by dsp21486
Why Is The Stock Market So Difficult To Predict?━━━━━━━━━━━━━ Let’s assume stock prices have been rising for several years. Investors realize that a correction will come and stock prices will tumble. What we don’t understand is what will trigger the selloff or exactly when it will occur. Therefore, some investors will sit on the sidelines holding cash, waiting for the opportune time to get in. Those who are willing to assume the risk may jump in because the return on cash is so low and it hurts to earn zero while watching stocks move higher. This begs a couple of key questions. If you’re on the sidelines, how will you know when to get in? If you’re already in, how will you know when it’s time to get out? If the stock market was predictable, these questions could easily be answered. However, it is not. There are actually three issues an investor should consider. The first is understanding the point at which stock prices are fairly valued. The second issue is the event that will cause a downturn
NSE:NIFTYEducation
by dsp21486
Option Strike Price "Secrets" In this article you will learn... - what a strike price is, - the different intervals for strike prices, - how to pick the right strike price, … and much more. Let’s get started. 1.) The basics: What is the strike price? Strike Price Definition: The strike price of an option is the price at which the option buyer has the right to buy or sell an underlying security. As an example, if you are buying a CALL option of AAPL with a strike price of 126, then you have the right to BUY 100 shares of AAPL for $126. And if you are buying a PUT option of AAPL with a strike price of 125, then you have the right to SELL 100 shares of AAPL for $125. Strike Price Intervals When you open an options chain, you will see all the different strike prices that are available. The strike price intervals are set by the options exchange and will change depending on market conditions and the price of the underlying stock. There are four commonly used strike price intervals: $1, $2.50, $5, and $10. There are currently no strict standards and the exchange reviews and decides on the strike price interval of each optionable stock from time to time in order to adjust policies to better cater to trading needs. Here are some general guidelines provided by the Chicago Board Options Exchange (CBOE): - 2.50 points strike price interval is used when the underlying stock is trading between $5 and $25, - 5 points strike price interval is used when the stock is trading between $25 and $200, - and 10 points strike price interval is used when the stock price is over $200. But these are just guidelines. The options exchanges decide on strike price intervals based on market demand and trader’s needs) more than any strict mathematical formula. In the example above, you see that AAPL is trading at about$127. So according to the guidelines, the strike price interval should be $5. But since AAPL is a very volatile stock that currently moves $2.50 per day on average, which is around 2% per day, the $5 strike price intervals wouldn’t make sense. That’s why the exchange decides to only offer $10 intervals to best serve the trader. Strike Price, Option Premium & “Moneyness” When buying or selling an option, you must choose a strike price, and often you will hear terms like: - In-The-Money (ITM), - At-The-Money (ATM), - or Out-Of-The-Money (OTM). I call this the “Moneyness” of an option. In-The-Money Options Strike Prices (ITM) TM Call Options will have strike prices below the current stock price. And ITM Put Options will have strike prices above the current stock price. In the example above, AAPL is trading at around $127 right now. Therefore, the strike prices of 125 and below are considered ITM for Call options. And the strike prices of 128 and above are considered ITM for Put options. At-The-Money Options Strike Price (ATM) An ATM option would be the closest strike price to the current market price of the stock. For our AAPL example (The current price is about $127), the strike prices of 126 and 127 are the closest strikes to the market. So these strikes are considered ATM for both Call and Put options. Out-Of-The-Money Options Strike Prices (OTM) An OTM Call Option’s strike price would be above the current market price of the stock. With an OTM Put Option, the strike price would be below the current market price of the stock. For our AAPL example (The current price is about $127), the strike prices of 128 and above are considered OTM for Call options. And the strike prices of 125 and below are considered OTM for Put options. 2.) How to Pick the Right Strike Price Wow! So many strike prices! So how do you pick the right option strike price? Are some strike prices more desirable than others? Absolutely! It really depends on what you are trying to accomplish: Do you want to BUY an option and make money? Do you want to SELL an option, collect premium and let it expire worthless or Do you want to SELL an option, collect premium, and get assigned? For now, let’s keep it easy. Let’s say you want to make money with a CALL option. Call option strike price example We will use AAPL again as an example. Right now, AAPL is trading at about $127. Let’s say you’re bullish AAPL and expect Apple to move up to 135 within the next month. If you were to look at an options chain, you would have several choices. a.) You can buy a cheap OTM option with a strike price of 135. The last price of the option was $0.86. Since options come in “100 packs”, you would have to pay $86 for the option. This would allow you to buy 100 shares of AAPL at a price of $135. b.) You can buy an ATM option with a strike price of 127. This option is more expensive. The last traded price was $3.80, so you would have to invest $380 for this option. And this option would allow you to buy 100 shares of AAPL at a price of $127. c.) You can buy an ITM option with a strike price of 124. This option is the most expensive. The last traded price was $5.90, so you would have to invest $590 for this option. And this option would allow you to buy 100 shares of AAPL at a price of $124. Now let’s say that AAPL never goes back up to $135. Let’s say that on expiration day (June 11), AAPL is trading at $134: a.) OTM Option with a strike price of 135 This option allows you to buy 100 shares of AAPL at $135. Since AAPL is trading at 134, that wouldn’t make sense. Why would you pay MORE for 100 shares of AAPL than the underlying stock price? So this option is worth nothing, and you lose the $86 option premium that you paid. b.) ATM Option with a strike price of 127 This option allows you to buy 100 shares of AAPL at $127. Since AAPL is trading at 134, you could buy 100 shares at $127 and immediately sell them for $134. In this case, you would make 134–127 = 7 per share. 1 option allows you to buy 100 shares, so your profit is $700. You paid $380 for this option and make $700. That’s a net profit of 700–380 = 320 or 84% based on your initial investment! c.) ITM Option with a strike price of 124 This option allows you to buy 100 shares of AAPL at $124. Since AAPL is trading at 134, you could buy 100 shares at $124 and immediately sell them for $134. In this case, you would make 134–124 = $10 per share. 1 option allows you to buy 100 shares, so your profit is $1,000. But you paid $590 for this option to make $1,000. So the net profit of this trade is 1,000–590 = 410 or 69% based on your initial investment. Let’s review: OTM Option: $86 loss ATM Option: $320 profit = 84% ITM Option: $410 profit = 69% As you can see from this example, it’s super important to pick the right strike price. The underlying security (AAPL) moved from $127 to $134. That’s a 5.5% move. Often traders who are new to options pick the cheapest options contract, i.e. the OTM option. But you would have lost the whole option premium. So should you pick the most expensive one? As you can see in this example, picking the most expensive option (i.e. ITM option) would have yielded the higher DOLLAR amount. But in terms of Return on Investment (ROI), the ITM option was best. Based on the trading strategy that you use, I can give you several guidelines on how to pick the right strike price. In a nutshell, when you are BUYING options, you want to buy an ATM or ITM options contract. And when you are SELLING options, you want to sell OTM options. More about that later. 3.) Three Important Things You Need To Know There are 3 more things you need to know when about strike prices when trading options: What happens when a call option hits the strike price? What would have happened if AAPL would have traded above the strike price of $135 before expiration? Nothing — unless you choose to exercise the option. But if this happens before the expiration date, then it would be better to sell the option since you would make more money. How do I change my strike price once the trade has been placed already? You can’t. You need to choose a strike price when you enter the trade, and you can’t change it while you are in a trade. You can only “roll” the option, and here’s how it works: Let’s say you bought the OTM option with a strike price of $135. And you realize that it was too ambitious and that AAPL probably won’t hit 135 before the expiration date. So you could “roll” the option by selling your 135 call and simultaneously buying the 132 call. What Is Spot Price and Strike Price? The SPOT PRICE is the current price of the underlying security, so using AAPL as an example, Apple’s current spot price, at the time of this writing, is $126.76 which is the price it’s currently trading. The STRIKE PRICE is the price at which you can buy or sell the shares of the underlying security on or before expiration. Summary s you can see, picking the right option strike price is extremely important. It will affect your returns and it could even make or break you in the market. In a nutshell, when you are a BUYER, you want to buy ATM or ITM options since even a small move in the underlying stock price can yield double-digit returns. When you are a SELLER, it’s the opposite: You want to sell OTM options that have a low probability of getting assigned.
NASDAQ:AAPLEducation
by rockwelltrading
2
Sell In May and Go Away?You might have heard the saying “Sell in May and go away.” It is an old investing adage that has been around for decades, but does it actually work? In this blog post, we are going to find out what’s best to do. We will discuss: 1. What is the meaning behind “Sell in May and go away?” 2. Does sell in May and go away work? 3. Should you sell in May and go away? 4. Two reasons not to sell in May and what to do instead. Let’s get started: 1. What Is The Meaning Behind “Sell In May And Go Away?” The saying “Sell in May and go away” has been around for a long time. It was first recorded in 1937 by John Hill via The Financial Times of London. The original saying was “Sell in May and come on back on St. Leger’s Day.” This phrase refers to a custom of aristocrats, merchants, and bankers who would leave the city of London and escape to the country during the hot summer months. St. Leger’s Day refers to the St. Leger’s Stakes, a thoroughbred horse race held in mid-September and the last leg of the British Triple Crown. And it seems that American traders have adopted the saying. Americans are more likely to spend more time on vacation between Memorial Day and Labor Day. 2. Does “Sell in May And Go Away” Work? And indeed, for over 50 years, the stock market performance supported the theory behind the strategy. From 1950 to around 2013, the DOW has had an average return of only 0.3% during the six-month period from May to October period. In comparison, the Dow had an average gain of 7.5% during the November to April period. So it seems that “Sell in May and Go away” is a strategy that may have worked for many years. But In recent times, it seems like the strategy has fallen out of favor. Technical analysts at Merrill Lynch looked at historical data and found THIS out: Looking at 3-month seasonal data going back to 1928, the June-August period typically is the second-best of the year, with gains 63% of the time, and an average return of 2.97%! 3. Should You Sell In May And Go Away? With all this conflicting data, does it make sense to sell in May and go away? Is this a good investment strategy? You know me — I always say “Trade What You See And Not What You Think!” Always look at the market data! As an example, last year, between May 4th and August 31st, 2020, the Nasdaq rose 28% (refer to chart). If you would have sold in May and "gone away," you would have missed out on these gains. 4. Two Reasons Not To Sell In May And What To Do Instead Maybe it makes sense to sell in May and go away when you’re an investor. MAYBE... But as a short-term trader like me, May is a GREAT month to trade, and here’s why: I like to trade The Wheel Strategy . With this trading strategy, you are selling option premiums. And there are 2 factors that influence options premiums: - Volatility When volatility is high, option premiums are higher. The Volatility Index VIX for the past few month, has been pretty low in March and April. But now, in May 2021, it's spiking up again. This means that options premiums are higher, which is perfect for a seller like me: I can get more premium! - Down Days Step 1 of The Wheel Strategy is selling puts, and you get more premium for puts on “Down Days” for such strategies. According to the NASDAQ , thus far, in May 2021, we had 7 “down days” and only 4 “up days." On “down days," there are many more trading opportunities. Last week, when the Dow Jones Industrial Average had its worst week since February, I made $3,722 in profits. Here Are Some Of My Trades In May: Let’s take a look at these trades in more detail: - Trade #1: Snapchat SNAP Snapchat recently had some rough weeks. In less than 2 months, it traded from a high of 72.50 to around $50 where it found some support. Most retail investors would stay away from a stock like this but I saw an opportunity to “buy it at a discount” : I sold Puts with a strike price of 47 and an expiration of 4 days. If SNAP closed below $47 on May 14 (the expiration date), I would have gotten assigned and bought SNAP for $47. I would consider that a bargain. If SNAP closed above $47, I would have just kept the premium that I received for selling calls. In this case, that’s $525. SNAP did close above $47 on May 14, and I collected $525 for 4 days of exposure in the stock market. - Trade #2: Square SQ Square looked very similar: Mid-February, the stock made a high of $280, but then it retreated to $200. Most market participants would not trade a stock like this, but looking back over a six-month period, I saw some good support around the $200 — $203 level. I sold 5 Puts with a strike price of 202.50 and an expiration date of May 14th. I received $100 in premium for each put, so I collected $500 in premium. On May 14, SQ closed above $202.50, and I made $500 in only 4 days. That’s a very nice return. - Other Trades I Took I sold 119 Puts on Apple , sold 212.50 Puts on Boeing , And I sold 39.50 Puts on Dave & Busters . All of these stocks have lost in value over the past few months. Investors who follow a ‘buy-and-hold approach” would lose money in this scenario, but as an active investor, I can apply trading strategies that make money even if the stock is going sideways or even moving lower. Summary “Sell in May and go away” is an old Wall Street adage that might be useful for buy-and-hold investors. But active investors like me are always on the lookout for trading opportunities. And with the right trading strategy, the increased volatility combined with markets that are moving lower is a dream come true. You need to have the right trading strategy. I personally like to use the PowerX Strategy for markets that are trending, and I trade The Wheel Strategy in choppy market conditions as we experience right now. With such a strategy, I am able to make money even if the stock is going sideways or lower. I for one will NOT sell in May and go away!
TVC:NDQEducation
by rockwelltrading
2
If you don't know the difference ...... you are in trouble! - Howard Marx In the late '60s and early '70s if you didn't own the Nifty-Fifty, there was something indescribably wrong with your portfolio - or you. The Nifty 50 stocks got their notoriety in the bull markets of the 1960s and early 1970s. They became known as "one-decision" stocks because investors were told by individuals such as University of Pennsylvania professor Jeremy Siegel that "they could buy and hold them forever." In case anyone is interested how the "Nifty 50" fared during the bear markets of 1973-1974; Blue Chip Performance: 1973-1974 Du Pont -58.4% Eastman Kodak -62.1% Exxon -46.9% Ford Motor -64.8% General Electric -60.5% General Motors -71.2% Goodyear -63.0% IBM -58.8% McDonalds -72.4% Mobil -59.8% Motorola -54.3% PepsiCo -67.0% Philip Morris -50.3% Polaroid -90.2% Sears -66.2% Sony -80.9% Westinghouse -83.1% Just to recap; ... as well as; U.S. Market Capitalization / U.S. GDP exceeded 2.75 while the Historic Norm (not the low) remains 0.78 - i.e. ~70% below current levels(!!) www.hussmanfunds.com U.S. Margin Debt / U.S. GDP has surpassed all previous records (by a very wide margin!), not only by nominal measures but also in relative terms! www.hussmanfunds.com
TVC:DJIEducation
by Nemo_Confidat
When To Take Profits on Options I’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Options trading is really fascinating, and it’s a great way to make money, and I think it is very important to know when to take profits, especially if you like trading The Wheel as I do. So the question is, when should you take profits when trading options? How exactly do you figure this out, is there a formula for it? In this article, I’ll share some guidelines for how and when you should take profits on an option trade. We will answer the question of whether you should let options expire or take profits early. I will show you some very specific examples of two trades that I have going on right now (at the time of this writing on March 17th, 2021). One of them, I took profits today, and the other one I’m still holding on and I will show you exactly why. ]How To Calculate Profits On Options Firstly, let’s talk about how to calculate profits on options. In order to address this, there are two types of options traders. One type of options trader are ones that are buying options, and the other, which I feel is very lucrative, and this is what I’ve been doing for a long time, is selling options and collecting premium. I want to actually talk about selling options and receiving premium, because this is, as I said, what I’ve been focusing on recently with trading The Wheel Strategy. My year-to-date profits on this account so far are more than $54,000 selling premium on options, and I’ll show you exactly how to do this. So when selling options, you’re receiving premium, and for me, the most important metric here is the so-called premium per day or PPD. MARA Example The first example that I want to give you is my position with MARA. Looking over my transactions with MARA over the last 30 days. I sold puts at a strike price of 20, and for this, I received $0.28 in premium per option that I sold. Now options come in 100 packs, so this means that per option I made $28. Now, in this specific example, I sold 50 options total, so this means that I’m receiving a premium of $1,400. I put this trade on March 10th, and these options expired on 3/19. This is $1,400 in premium in 9 days. This comes to $155.55 in premium per day, or PPD. Now this includes weekends. My rule is I’m buying back the option when I can get 90% of the maximum profits, but there’s an exception to this rule. First, let me tell you what that means. So again, I sold each contract for $28, for $0.28. The idea is to buy back the option at $0.03, and this is exactly what I did today (March 17th). So we have another two days to expiration. So today, I bought back a total of 50 contracts at $0.03, and by doing so I made $0.25 in profits on MARA. Now, this is where again, we’re looking at 50 contracts, times $25, so this is $1,250. I was in this position for 7 days. So $1,250, divided by 7 days, means that I made $178.57 a day. Let’s just round to $179 per day. As you can see, $179 is more than the $155.55 that I planned per day. Now let’s think about it. If I would keep MARA right now, if I would keep this option until expiration, but what would happen? I would make an additional $150 in three days. This means that now my premium per day is only $50 per day. This doesn’t make sense to me because this here is actually bad, because my plan was to make $156 per day, and I was able to make $179 per day by buying the options back. If I would hold on to this trade and let it expires worthless. So this is where here, and let it expire worthless, right? This is what would happen. I would make an additional $150 in three days and the premium per day would only be $50. That does not make sense to me at all. This is why here in MARA, it made sense to buy back the put option because by doing so, it frees up buying power meaning that now I can sell more puts. So the idea here is that I’m selling more puts and making more money on the new puts than I would make holding on to MARA. DKS Example Let’s go over another example with a position I have right now with DKS . I sold the 66 strike on March 10th. I sold 15 of them and I received $75 in premium. 15 contracts times $75 comes to $1,125. So let’s do the math right now and see if it makes sense to close this trade today (March 17th) or if we should keep it, and we’re using very similar logic here. So we sold the 66 put expiring March 19th, and we received $75 per contract for it, $1,125 total. We then divide this by 9 days to get to our premium per day, which is $125. So right now, on March 17th, let’s see how much DKS is still worth. Right now, the bid/ask for DKS is $0. 05 over $0.10, and that’s really interesting because I want to buy it back at $0.07. Let’s say right now, if I would place an order right now, I could buy it back at $0.10. Should I do it? If I did this, I would make $75, minus $0.10 ($10 per contract), which is $65 per contract. For all 15 contracts, I would make $975. We find our PPD by dividing $975 by 7 days, which comes to $139. So if I really wanted to, and if I needed to free up some buying power, I could do this. But let’s see what happens if we hold this for a few more days. So if we hold DKS until expiration, we can make an additional $150. It might actually make sense to close it out because $150 over the next three days does not make a lot of sense. When I looked at the option earlier, DKS suddenly jumped from 78 to almost 79. This is a 10% jump in 30 to 45 minutes. When we opened this morning, first, we went down, and then we went a little bit up, and then we were hovering right around where we opened. Earlier this morning, the DKS put was trading at $0.25. So the question is earlier this morning, would it have made sense to close it? Earlier today on March 17th, I could have bought it back for $0.25. So that wouldn’t have made sense, right? Because then if I’m buying it back for $0.25, I would only make $0.50. So this here, $0.50, this is then $750 in seven days, and if we divide $750 by 7 days, this is $107 premium per day. As you can see, the $107 premium per day is less than what I expected. If I would hold DKS to expiration, we can make an additional $0.25, $25 times 15 contracts is $375. Now, if you take the $375 in 3 days, that would be $125 premium per day. So when I’m getting $125 premium per day, this is when it does not make sense to sell it just yet. Should You Take Profits Early? So this is the important thing because the question always is, do you take profits early, or hold until expiration? Well here’s my formula for this. So I want to give you a very specific formula that you can use if you want to. If the current realized premium is a premium per day, PPD, is larger than the planned PPD, this means close it out early. If the remaining premium per day is smaller than the planned premium per day, close it. Only if the current realized premium per day is smaller than the planned premium per day, in this case, hold it. If the remaining premium per day is larger than the planned PPD in this case, you want to hold it. Summary This is why today I wanted to show you my formula for when to take profits on options, especially when you are an options seller. You see, selling options and receiving premium is what we do with The Wheel Strategy, and the most important metric here is the premium per day (PPD). This where using the PPD, you can actually get down to a formula of when exactly you should buy or sell. This is where it’s just a good rule of thumb if you don’t want to do all these calculations. So the rule of thumb is I close a trade when I can realize 90% of the maximum profits.
NASDAQ:MARAEducation
by rockwelltrading
3
Why Most Traders Lose Money — Here Are The Top 3 ReasonsI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Anyone that has been around the markets and trading for any period of time has probably heard that most traders lose money. In fact, there’s actually an old trading adage that says: 90% of new traders will lose 90% of their account within 90 days. So after reading that, before you reach for your broker’s phone number to wire out all of your money… how about I let you in on a little secret: If you follow some simple rules and avoid these 3 mistakes, you can be in that minority of traders that actually make money consistently in the markets. And if you are currently making one or all of the mistakes, I’ll also show you exactly how to fix it. So let’s dive in! 1) Most Traders Enter A Trade Too Late The first thing on my top 3 reasons why traders lose money is: Most traders get into trades WAY too late! There are a lot of reasons this happens, but most commonly it’s because new traders are basically gambling. They’re buying stocks or options based on news, or a hot stock tip, which really isn’t what I would consider a strategy. So let me give you a great example with a company I’m sure you’ve heard of: Uber Technologies (Yes, enemy #1 for taxi drivers worldwide.) Last year UBER , known for its popular ride-sharing and food delivery services, IPO’d in May (2019). With the disruption this company caused, their IPO had a lot of hype surrounding it, bringing a lot of investors to the table. On the day of their IPO, UBER opened at $42/share and people poured into the stock. For a few weeks, the stock had a turbulent, roller coaster of a ride all the way to as high as $47.08/share, a little over a 13% increase since its IPO. And around this new high, more and more inexperienced retail traders piled in thinking that it would continue its bullish run with dollar signs in their eyes. The mainstream media was continuing to hype it and more and more and investors and traders gobbled up more of the stock. Looking at the image below, you’ll see after that high of $47 things got UGLY fast, with UBER falling day-after-day, week-after-week. It wasn’t until November of 2019, about 7 months after their IPO that UBER found a temporary bottom at $25.58, down more than 45% from its high of $47.08… and I would bet there were a LOT of people who bought near or at the highs and were still holding at that point. So what did retailer traders do when UBER made a bottom? Yes, once again most (losing) retail traders didn’t get in at, or even around the bottom… once again, they piled as UBER neared its previous highs. And as you’ll see yet again, UBER rolled over on its way to making another new all-time low this past March 2020 going all the way down to $13.71/share. That’s more than a 70% decrease from its ATH and yes, I’m sure some investors rode it all the way to the bottom. Now I want to share a second example with you, so let’s take a look at Amazon AMZN . So as you know, AMZN is a HOT STOCK and last year it has a crazy move where it crossed $2000/share…. and yes, just like our example with UBER , inexperienced retail traders piled in at the very top. Once again, in the weeks that followed, AMZN’s stock tanked leaving those who’d piled in dazed and confused, now holding onto sizable losses. So as you can see, the first of my top 3 reasons most traders are losing money is simply because they’re piling in way too late in a stock’s move, generally near a high. Now on to reason number 2: 2) Most Traders EXIT Too Late Yes, as you can imagine if people are getting in too late, well, they’re also typically getting out too late as well. So let’s talk about why this happens. Why do retail traders tend to hold onto trades way too long, either turning a small loss into a BIG loss or sometimes even more painful, turning a winner into a loser? Let’s take a look at another example with an UBER competitor, LYFT . Like UBER, LYFT also had its IPO in 2019, opening up at $87.24/share… but that didn’t last long. In less than two months, LYFT went as low as $47.17… and what do you think those who bought during the IPO are saying right about now: “Oh, I’m holding it because IT WILL TURN AROUND!” This is generally where I see traders get religious Instead of ‘taking their medicine’ and getting out when the trade moved against them, they held on and are now pleading and praying the stock will turn around. I hate to be the one to break it to you, but ‘hope’ is not a strategy… at least not one with a winning trading record. Now on to number three in our list of top reasons why most traders lose money: 3) They Don’t Have A Trading Strategy As you’ll see, I’ve saved the best for last as this one alone can help fix or eliminate the other two we just discussed. So first, let’s answer this question: What Is A Trading Strategy? Well, a trading strategy gives you three key pieces of information you need before ever entering a trade: 1) It tells you WHAT you are trading. Is it stocks, options, futures, cryptocurrencies? This is answered in your trading strategy. 2) It answers when you ENTER a trade. 3) It answers when you EXIT a trade and that’s exiting with a profit or loss. Now, let’s take a look at an example here using TSLA on how I make trading decisions. I like to look at three different indicators, that when in alignment, give me a clear signal to go long or short a stock or ETF. As you can see on the charts, back in December of last year (2019) my indicators gave us a long signal on TSLA at around $370/share. And the indicators told me we were good to go until around $850/share. All I had to do is let the indicators tell me when to get in and when to get out… no guessing, hoping or praying. Summary So as you can see, there’s actually no big secret to why most traders are losing money. It’s actually pretty simple to see and correct, but it takes a plan and a little bit of discipline. If you’re brand new and not sure where to get started, I’ve written The PowerX Strategy, a book that outlines my EXACT trading strategy for trading stocks and options.
TVC:NDQEducation
by rockwelltrading
1
How To Play The Markets To The DownsideI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. How can you make money in a market that is going down? Today I want to show you two strategies on how to do this. Shorting A Stock The first strategy is shorting a stock. So what does this mean and how does it work? Well, it means that you can sell a stock right now even if you don’t own it, and then buy it back later at a cheaper price. This is how it works. So first there is your broker, then there’s you who wants to participate and make money in a falling market. Let’s use Apple AAPL as an example. Let us pretend AAPL is currently trading at $119 & we believe that AAPL actually might go down again to $110. You can make money betting against AAPL in a falling market, and here’s how it works. Now, you want to sell AAPL but you don’t have the shares just yet. So what you would do is you borrow shares from your broker. So your broker is actually lending you 100 shares of Apple, or at least, we’ll use 100 shares for this example. Now, the price at this point doesn’t matter. He’s just giving you the shares and says, “OK, you need to give me back these shares later on.” And he is actually reserving some money from your trading account to make sure that you really give it back to him. Now, you have 100 shares, and you can do with these 100 shares pretty much whatever you want. So in this example, you would sell them. So you sell AAPL , 100 shares of them, at the current price of $119 because you believe that AAPL will go down. So how exactly do you make money? Let’s say after a few days, AAPL , in fact, does drop down to $110. Here’s what happens next. Now you are buying back AAPL at $110. So how much money do you make? If you sold AAPL for $119 and you’re now buying it back at $110, you’re making $9 per share, multiplied by 100 shares. This comes to $900 in profit. Now that you have the shares back, you, of course, have to give them back to the broker. Remember, the broker lent you the shares, so you have to give them back those 100 shares of AAPL , and when you do, the broker releases the money that they held, kind of in escrow, to make sure that you are getting the money back. Now, the beautiful thing is this is all going on in the background. This is what it would look like on a trading platform. So now, I want to trade AAPL , and I want to just sell 100 shares of AAPL . So all I do here is, it says already short minus 100 and I would sell them at the current price of $119.35. So I click review and send. And the broker is requesting almost $6,000 from me. And this $6,000 is basically the money that he’s holding in escrow to say, “All right, Markus, you have to give me back the shares.” And it is that easy. And now if I click on “Send Order,” I would sell the shares. So this is the first way because I told you that I’ll give you two strategies of how to benefit from a falling market. So this was strategy number one, shorting a stock. Buying A Put Option Now, let’s move on to strategy number two. You would buy a put option. “Put” means that you have the right to sell a stock at the strike price. So, again, we will be using the same example of AAPL that we used for the first strategy. So as I just said, we’re pretending AAPL right now is trading at around $119 and we believe that AAPL will go down to $110. This is how this would work. So this is where we are looking at an AAPL put, let’s say here, AAPL put of 119, and it is trading at around $1.80. So here is what exactly we would do. We would buy a put for $1.80. Now, this put gives us the right to sell AAPL for $119. Now, if AAPL really goes all the way down to $100, see same deal here, we actually would make $9 per stock. However, we have to deduct the premium that we paid for the option, which is $1.80. So this means here we are making $7.20 per share ($9 — $1.80). If we would trade one option, one option controls 100 shares, so this means that we are making $720 total. Which Strategy Should You Use? Now, the main difference between these two strategies is that, for strategy number two buying a put, you don’t need as much money. Remember when I went to my trading platform earlier and wanted to sell AAPL 100 shares, that my broker was reserving around $6,000 dollars in my account? Now keep this in mind. According to what my trading platform is telling me, if I want to buy this option, it would only cost me $180. So as you can see, huge difference. In the one case, the broker is reserving $6,000 with the possibility of making $900. For strategy two, buying a put, your broker is only requesting $180 and that is also the maximum amount that you can lose, and you can make possibly $720 here. Summary So this is how you can make money in a falling market. Now, very important, strategy number one, where you’re just shorting the stock and where the broker is lending you the stock, you cannot do that in a retirement account. But strategy number two, buying a put, you CAN do in a retirement account, and you can do this for any stock. Now, you might actually be bullish on AAPL , but if you look at some other stocks right now that we're in a downtrend, for example, ZM , if you say, “Oh my gosh, Zoom is crazy, during the pandemic here,” it went from, what? $50 to $500? You could think, “This is absolutely overvalued and I believe that Zoom will go down to $300” you can use one of these strategies. So you see that all these stocks that, during the pandemic benefited a lot, could actually move lower, this is how you can make money in a falling market. So now you know two strategies how to make money in a falling market, how to bet on a stock that is going down.
NASDAQ:AAPLEducation
by rockwelltrading
1