Take a look at the 100 year chart provided below . I have coloured each "Market" appropriately -- Green for Bull, and Red for Bear -- to show more clearly what happens. Bull markets get ahead of themselves. At their ends, they tend towards excesses that take a very long while to recover from. When a long Bull runs end, it takes quite a while before the next one … [Read more...]
Archives for 11/11/2009
Linear Regression Trendline
A Linear Regression Trendline is a straight line drawn through a chart of a security's prices using the least squares method, and it is used to forecast future trends. A Linear Regression trendline uses the least squares method to plot a straight line through prices so as to minimize the distances between the prices and the resulting trendline.A Linear Regression trendline is … [Read more...]
Linear Regression Indicator
The Linear Regression Indicator plots the trend of a market instrument's price over a specified length of time. The trend is determined by calculating a Linear Regression Trendline using the "least squares fit" method. This method helps to minimum distance between the data points and a Linear Regression Trendline. Unlike the straight Linear Regression Trendline, the Linear … [Read more...]
Reasons to do Derivative Trading
If you are thinking of a trading option outside traditional stocks and bonds, derivatives trading can be a good option. Derivatives pay off over a period of time which is subsequently based on the performance of assets, interest rates, exchange rates, or indices. The payoff can be either in cash or in kind(assets )and vary, of course, by performance and timing. In addition to … [Read more...]
Derivative trading
A derivative is a financial instrument that is derived from some other asset, index, event, value or condition (known as the underlying asset). Rather than trade or exchange the underlying asset itself, derivative traders enter into an agreement to exchange cash or assets over time based on the underlying asset. A simple example is a futures contract: an agreement to exchange … [Read more...]