Trending Together

Many stocks tend to move in tandem, so pairs trading enables investors to mitigate directional exposure Investors might consider using pairs trading when they feel bullish or bearish on a stock but want to reduce exposure to the daily movement within the market. In other words, it’s well known that stocks tend to move in … Continued

How Gold Fits

 Investors often tout gold as a strategy during market declines. It sounds ideal because a precious metal like gold should withstand shocks to the economic cycle, right?  Well, not always. Think about the decline of the S&P 500 at the end of February. The market dropped and so did gold. Yes, it did provide some … Continued

Three Roads to China

Some stocks offer more exposure in Chinese markets than their names suggest. Here’s a sampling of opportunites. Alibaba A Chinese holding company with a range of products and companies, Alibaba (BABA) invests mostly in independent firms that expose investors to only small amounts of industry risk. Takae a look at some of the companies under … Continued

Chinese Stocks & ETFs to Trade

Investing in China remains notoriously difficult, but here are some liquid options With the second-highest gross domestic product (GDP) in the world—and a close second to the GDP of the entire European Union—China is indisputably a major player in the global economy. Even though some Chinese stocks don’t have great liquidity (ease with which investors … Continued

A Better Way to Put It

Protective puts are popular, but traders have more cost-efficient ways of hedging their positions Losses hurt. Experiments indicate that avoiding a $5 loss carries twice as much psychological power as experiencing a $5 gain. Traders who overstress about loss avoidance actually create the loss they so much want to avoid.   A simple online search … Continued

Volatility by Sector

RIPE AND JUICY TRADE IDEAS Traders think of Biotech as the most volatile sector, but it wasn’t in 2019. Last year, the most volatile sector by far was Oil Services, followed by Oil and Gas Exploration and Gold Miners. The least volatile sectors were Consumer Staples, Utilities and Health Care. Why does that matter? Volatility … Continued

Zeroing Out Those Utility Bills

With this hack, investors can make utility companies pay the family gas and electric tabs Traders consider utility stocks relatively safe investments—partly because regulation limits competition. Besides, the massive infrastructure required to produce gas or electricity is so expensive that it serves as another nearly insurmountable barrier to entry.  What’s more, revenues tend to remain … Continued

Sector Ignorance

RIPE AND JUICY TRADE IDEAS Most investors own one or more of the Dow Jones, S&P 500, Nasdaq or Russell 2000 indexes. Common ways to buy into them are through exchange-traded funds, such as Dow Jones (DIA), S&P 500 (SPY), Nasdaq (QQQ) and the Russell 2000 (IWM).  But drill into those indexes and it becomes … Continued

Sizing Up Futures Contracts

Most traders find old school futures contracts too big for their accounts  To trade futures, begin by understanding the sizes of the products, the expected moves and whether the futures product is appropriate for the size of the account (see “Follow the table” below).   Good thing you got a guy to help determine all that—me! … Continued

Smaller Futures Contracts Put ETFs in the Crosshairs

Savvy investors will discover more uses for the smaller futures contracts exchanges are developing Exchange-traded funds (ETFs) work well for passive investors—but not for short-term traders or sophisticated investors. Still, anyone looking to reduce risk in a portfolio heavy in ETFs will find the new, smaller futures contracts from the Small Exchange an efficient means … Continued