Hubble, Bubble, Toil and Trouble

barjon

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Dow has gone beserk this month compared to S&P and NASDAQ. Trying a pair trade.

Short DOW @ 23455
Long x 4 NASDAQ @ 6071
 

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Hoping they meet in the middle?

Aye, DOW has been trading very strong against NASDAQ so looking for for them to revert to a more normal relationship by NASDAQ trading strong against DOW - doesn't matter if they are going up or down so long as NASDAQ rises more than DOW relatively if the UP continues, or falls less than DOW relatively if they go south.
 
Aye, DOW has been trading very strong against NASDAQ so looking for for them to revert to a more normal relationship by NASDAQ trading strong against DOW - doesn't matter if they are going up or down so long as NASDAQ rises more than DOW relatively if the UP continues, or falls less than DOW relatively if they go south.

So this raises the question of when to close the trade, what will you be looking for?
 
So this raises the question of when to close the trade, what will you be looking for?

Yes, there's no natural target to look for - either for gain or loss - so it's just a question of watching how it goes. I check it each hour.
 
Currently NASDAQ 6068 = -3 @ £4 = - £12
DOW 23436 = + 19 @ £1 = + £19
 
Currently: NASDAQ 6072 = +1 @ £4 = +£4
DOW 233390 = -65 @£1 = +65

NET+£69
 
Just closed

Nas 6054, Dow 23334 for net £52 on the basis of £1 Dow, £4 nas.

Bit of a roller coaster while I was out at the circus with granddaughter (so much for checking every hour!). One of the troubles with this sort of trade is that you can’t set a trailing stop or anything like that because it’s the relationship between the two that counts and not the individual prices.
 
Just to show the potential in this sort of trade.

A few minutes ago Nasdaq 6067 = -4@£4 = -£16
"..................... Dow 23357 = -98@£1 = +£98
...................... net = £82
 
did you just take a trade without a stop jon!? (y)

No stop ? Back in the 1950s when I went to school that would have been a BM. Which is a beatable mistake. 6 thwacks with the cane on the backside. It really stung !!
 
Sure is:

Nasdaq long @ 6215 = +144 @ £4 = + £576
Dow short @ 43430 = - 25 @ £1 = + £25
Net + £601

Unusually, both long and short in profit.

John, me thinks your broker will claim you took advantage of mis pricing on your Dow short :p

Joking apart - nice one, and another thread showing another way of trading. It pays not to label ourselves as anything, its more to do with spotting opportunities and taking advantage of them.

(y)
 
On a more serious note, we needed this to happen, the markets had gotten a bit out of whack, and if we are to have a pullback Tues/Wed then we need all 3 ducking and diving in sync, rather than having a puppy off the lead doing their own thing.
 
On a more serious note, we needed this to happen, the markets had gotten a bit out of whack, and if we are to have a pullback Tues/Wed then we need all 3 ducking and diving in sync, rather than having a puppy off the lead doing their own thing.

Have a heart. Brewski is all in spuds deep long Dow.(y) Going very well I hear.
 
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