pssonice
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Disturbing an Equilibrium System like the stockmarket is easy
the financial system is manipulated by rules.
selling shares is much more difficult than buying shares.
the majority of participants on the financial markets r buyers, where the edge is
the financial system is manipulated by rules.
selling shares is much more difficult than buying shares.
the majority of participants on the financial markets r buyers, where the edge is
grantx said:
Tangled webs, indeed.!!!
Did I say that? I said"Be the one who knows"
The one with the edge is the one who gets in ahead of the pack. He does a lot of research into fundamentals, as well as TA. I have a list of fundamentally sound companies- some of them are too high and others I am waiting for, what I think, is the low point. None of my shares are bought only on how the charts look. When I have bought them, part of the "edge" is patience.
Split
In stocks buyers have the edge because markets trend upwards long term - bull markets last longer
than bear markets - In forex niether have the edge as being bearish on one currency = bullish on the other. Also it is said that 90% of traders lose but with money management you could lose 80% of your trades with a 4:1 risk reward ratio and still be in profit so have you really lost even though you have lost most of your trades?
than bear markets - In forex niether have the edge as being bearish on one currency = bullish on the other. Also it is said that 90% of traders lose but with money management you could lose 80% of your trades with a 4:1 risk reward ratio and still be in profit so have you really lost even though you have lost most of your trades?
I think that we both have different perceptions as to what "edge" means.
To me, "edge", even in forex, means the 10% that does win has it, not the 90% that does not.
A trader who loses most of his trades, does not have an edge, IMO.
By losing, I mean losing money as a result.
As far as shares are concerned, one can trade a very good rising share, even the index itself, and lose money consistently because of bad timing. Such a trader has no edge.
Having an edge means knowing how trade in such a way as to be, consistently successful. It may mean knowing only one company, the business that that company is in , trading its ups and downs on a regular basis and nothing wlse.
Split
Providing that they are covered. I believe the institutions are the big writers because they are likely to own large blocks of shares.
Take the recent strong bull market. The large investors are already making a big profit from that.
Instead of selling their shares at the top many could have, and probably did, write options.
In the worst scenario , they have their option money and might get their shares exercised at a level higher than they originally bought. Or they may end up with the shares which they did not want to sell, plus their premium.
Naked writing though, although some say that they do it profitably, should be avoided by everyone who is not thoroughly trained as a professional.
Take the recent strong bull market. The large investors are already making a big profit from that.
Instead of selling their shares at the top many could have, and probably did, write options.
In the worst scenario , they have their option money and might get their shares exercised at a level higher than they originally bought. Or they may end up with the shares which they did not want to sell, plus their premium.
Naked writing though, although some say that they do it profitably, should be avoided by everyone who is not thoroughly trained as a professional.
