For questions related to trading. Typically used for Stocks trading, can be used for Options or other trades. Related tags are day-trading, trading-volume, online-trading.

learn more… | top users | synonyms

9
votes
2answers
325 views

When the market price for a stock is below a tender offer's price, is it free money (riskless) to buy shares & tender them?

For instance, on March 11, 2014, Jos A Bank (JOSB) agreed to be acquired by Men's Wearhouse for $65/share in cash. A tender offer to existing shareholders was set to expire on March 19th. On March ...
0
votes
1answer
25 views

Deducting related educational trading expenses from LLC?

From what I understand, you need to trade full-time in order to deduct educational related trading expenses such as magazines, courses, or newsletter subscriptions. If I'm not a full-time trader but ...
2
votes
2answers
194 views

I have $20k of imaginary gains from trading last year due to wash sale rules. Should/can I take mark to market?

I have traded for most of the year while I work at my full time job as a software developer. I am using it to augment my income. I like working in academia but it just doesn't pay that well! I started ...
15
votes
1answer
3k views

Difference between GOOGL and GOOG

why are there two ticker symbols for google ( GOOGL and GOOG ), they seem to be mostly identical but when I look at their market values they result in different values currently: 551.64 for GOOGL ...
1
vote
2answers
86 views

Trading: How do you earn a good income when there is such a small change in price (pips)?

I don't understand how one can make more than pennies on a trade when the price will only increase in minuscule amounts - pips.
0
votes
2answers
78 views

Stock market order execution

I want to know how an order gets executed at exchange level once I place an order through an online broker. If i place a buy order for 1000 shares of XYZ Company, does it execute at one exchange? or ...
0
votes
1answer
119 views

Stock Trade Transaction Fee - at what point is it worth it

I have a question regarding the transaction fees that brokers charge and to what extend that put a limit on the minimum amount of shares it is worth buying and how often you can/should trade them. ...
1
vote
2answers
84 views

If trade is settled at the Ask, can I conclude that the immediate trend is bullish

If bid price is 100$ and Ask price is 101$, and the trade happens at 101 $, can I conclude that the buying pressure is more than the selling? If the trade happens on above average volume, (e.g more ...
2
votes
1answer
60 views

Am I doing the math for this covered call/long put strategy correctly? What risks do I run with this strategy?

In this trade, I write an in-the-money covered call and buy an in-the-money put (as an example) on GM, expiring in September 2014. The call premium is $10.02 with a strike of $26, and the put premium ...
0
votes
1answer
48 views

Regulation T and Initial Margin Requirements: How to interpret the 50%?

I wanted to understand initial margin requirements in the Federal Reserve's Regulation T section of the code. I read an article in Investopedia on Regulation T requirements, but I still feel uneasy ...
5
votes
2answers
116 views

Why would someone buy a way out-of-the-money call option that's expiring soon?

I swing trade equity options every once in a while for fun. This morning I witnessed something I do not understand at all. In the attached photo, why would someone purchase 6 contracts for .05 at ...
2
votes
1answer
139 views

Does the uptick rule apply to all stocks/ETFs and other securities, or only specific ones?

Does the uptick rule on U.S. securities apply universally across all stocks, all bonds, all futures and all options? Or is it limited to certain category of securities/instruments? Is there a ...
2
votes
2answers
171 views

When to use geometric vs. arithmetic mean? Why is the former better for percentages?

While computing the average price of a stock or index over a period of time, I have the choice between using an arithmetic mean or a geometric mean. Which should I use and when? I am reading a book ...
3
votes
2answers
262 views

Is there a significant danger to market orders as opposed to limit orders?

I'm following an automated trading system. It gives me buy/sell signals periodically. I usually just add/subtract 0.5% from the current price (as reported by Google Finance) and buy/sell. Last ...
1
vote
1answer
73 views

What does it mean when the broker does not have enough shares to short?

I recently opened a margin account at Questrade with 1000 dollars to see if I can learn anything about margin trading. Today, I'm trying to short sell 2 shares of XLU at a $40 limit price and it ...
0
votes
0answers
33 views

Where can I find a graph of bid & ask prices for a stock, and quantity of shares at each price level?

A website I use that follows the price of Bitcoin provides such a graph (below) so I was wondering if it were available for stocks. http://bitcoinity.org/markets (the second graph down on the page ...
3
votes
2answers
122 views

Are non-US citizens trading on US stocks/options subject to tax?

I'm a non-US citizen, and not residing in US, who uses an online brokerage firm to trade US stocks and options. Are my capital gains (short term and long term) and dividends subject to taxes? If yes, ...
1
vote
2answers
127 views

Why does a small number of bid/ask quotes not cause stock price to fluctuate drastically?

Often times I find that the number of bid and ask quotes presented for a stock are quite small in number. For example, just today I was watching a stock whose bid and ask prices looked very similar to ...
3
votes
3answers
79 views

When writing a covered call, what's the difference between a “net debit” and a “net credit”?

My brokerage account (Fidelity) gives me two choices when writing a covered call: net debit and net credit. What's the difference between these two choices? For example, take DRRX (share price $1.4). ...
-1
votes
1answer
55 views

Confused about google portfolio chart

I added a test trade using google finance, buying 1 share of Google stock : At the end of day here is how the portfolio appears : How the the run percentage so high ? 1367.53% is calculated how ...
1
vote
1answer
63 views

How to select a service to use to begin making investments?

I'm looking to make a small investment in stocks. I like the idea of ETF's and since I'm based in Ireland I'm considering using Davy : http://www.davyselect.ie/our-services/self-invest.html Is this ...
2
votes
1answer
94 views

Am I doing the math for this long straddle strategy correctly?

I'm looking at making a long straddle trade, and I'm trying to make sure I have the math correct before making the trade. Here are the details in the example I want to work out: I'm using options on ...
3
votes
1answer
71 views

Do individual investors use Google to obtain stock quotes?

In relation to my empirical research I am interested in the following questions (regarding the US). 1) How widespread is the use of Google when invidual/private investors wants to find information on ...
2
votes
2answers
69 views

Will a stop order get triggered if the floor is hit and trading is halted?

Let us say I have bought a stock XYZ at $100 and I have a stop loss order at $95. Some bad news comes out suddenly, or maybe a flash crash happens, so the price drops from $100 to $90 and trading gets ...
5
votes
2answers
119 views

With respect to insider trading, what is considered “material information”?

I'm trying to understand what is considered "material" information held by an executive of a company. There is company information that an executive (say insider) will know that a public investor will ...
-2
votes
1answer
64 views

What are some known strategies that might trigger a share price drop? [closed]

I am wondering if it's possible to trigger a share price drop by trickle selling the "right" volume of shares with the intention of flushing out doubtful investors in order to a) get their shares and ...
4
votes
2answers
140 views

Can institutional, quant, or other professional traders “prey on” (make money from) retail investors?

I was recently reading a well known forum, and someone made this post: I worked for a large investment bank about 10 years ago, writing trading programs for quant traders who were market ...
7
votes
1answer
126 views

Transitioning from paper-trading (demo trading) to real trading?

I have two questions here: When one first starts trading, what are some things that one encounters that paper-trading does not prepare one for? The most common response I see for this question is, ...
0
votes
1answer
47 views

Why some things are traded in an exchange while others are traded OTC

What is the reason some instruments like CFDs and FX are traded as OTC instruments while others (stocks, futures,options) are traded in an exchange?
0
votes
2answers
148 views

What do brokers do with bad stock?

I'm new to financial markets and how they work is still fuzzy, so bear with me. This question actually has multiple questions :( ... and a bit of a story. I was watching a YouTube video on the ...
5
votes
6answers
257 views

Is real (physical) money traded during online trading?

In Islam, it is a common ruling that the product that a person buys should exist physically (i.e. you are not allowed to sell something that does not exist), which brings up a very real concern when ...
6
votes
2answers
112 views

How Does A Special Memorandum Account Work

I've noticed that a lot of brokerage firms mention Special Memorandum Accounts (SMA) within the context of calculating margin requirements for margin accounts. Can anybody explain or perhaps direct ...
3
votes
1answer
91 views

Why people still look for “naked” short-sellng stocks instead of short selling CFDs

I have been doing some research about equity trading and the stock market in general, and I have a doubt. I see that a lot of people is looking for short-selling stocks, but that is not so easy ...
0
votes
0answers
23 views

How does a stock price affect a company after its IPO? [duplicate]

A company sells all stock on offer at an IPO which raises money. How is a company affected by it's stock price after the IPO?
3
votes
2answers
142 views

Market Making vs Market Taking (Quotes vs Orders)

This is in by no means a duplicate. I've found similar questions that didn't clarify. I'm simply wondering if there is a relationship between quote driven markets (market making) and order driven ...
2
votes
1answer
46 views

“limit order” vs “at-or-better order”

Investopedia says that a limit order is: An order placed with a brokerage to buy or sell a set number of shares at a specified price or better. Investopedia says that an at-or-better order is: ...
3
votes
3answers
126 views

Offer Price for my stock not shown on quote and a subsequent sale higher than my offer

I offered 30,000 shares of stock for sale at .54 when the ask was quoted at 10,000 shares for sale at .62. My offer never became the ask that day. Therefore, the broker was telling the public that ...
1
vote
2answers
159 views

OHLC chart, is it graphed on bid prices, ask prices or executed trades?

I have a stream of bid/ask market data and a stream of executed trades. Quick question, as not too sure how to best approach this. To draw an OHLC chart, would I: a) Base calculation entirely on ...
3
votes
2answers
143 views

What do “cake and underwear” stocks refer to?

LegacyForex: Buffett knows that a remarkable surge in Coca Cola or the Washington Post is unlikely, but he also knows that steady growth in these companies is a good bet, so with capital ...
3
votes
1answer
110 views

Can you sell on the settlement date?

I've understood the concept of freeriding but there is one aspect which my googling hasn't been able to answer. If I buy on Monday with unsettled cash which is due to be settled on Thursday, I cannot ...
1
vote
2answers
108 views

What would the broker do about this naked call option?

Let's say there is a stock of ABC currently at $8, and I sell a (naked) call option on it, with a strike price of $10 and expiration in two months. Suppose my broker lets me do this if I have 50% of ...
0
votes
1answer
143 views

What would stop someone from taking advantage of wide bid-offer spreads in extended hours trading via short selling?

I understand that the less volume occurring in a security, the less liquidity (the wider the bid-offer spread). So my question is, in pre-market and after-hours trading, when bid-offer can widen ...
3
votes
3answers
141 views

Why hedge when one can simply reduce the position size?

Often, I would read about traders/investors hedging their position in case things do not go their way. I find this strange. If one were unsure, then wouldn't it be better to simply reduce the position ...
0
votes
2answers
66 views

Are there any investment strategies which take advantage of an in-the-money option price that incorporates no “time value”?

I'm not sure if "time value" is the correct term, but if an option (still at least several months from expiry) is trading at the difference between its underlying stock's price and its strike price, ...
2
votes
1answer
902 views

Why can low volume move a stock price drastically?

Over the summer on days with very low volume, there were substantial movement in the stock markets. Why is this? Is it because there aren't enough market forces in check to really give a correct ...
3
votes
2answers
102 views

Looking at Options Liquidity: what makes some stocks so attractive for options traders?

I've noticed that options volumes can vary dramatically between underlying securities. What makes some stocks (e.g. AAPL, BAC) so attractive for options traders?
1
vote
2answers
247 views

If I buy a share from myself at a higher price, will that drive the price up so I can sell all my shares the higher price?

Suppose I buy 100 shares of Apple at $200 and I want to increase the share price. If I sell 1 share at $210, and at the same time log in to buy the share at $210, will the share price increase to $210 ...
2
votes
1answer
81 views

How to find the smallest transaction fees and commissions available and reduce trading overhead?

I buy and sell stock through my bank. The various bank/broker/tax overheads, if I was to buy stock and immediately sell it at the same price, is roughly 3%. I am seeking to understand what exactly ...
0
votes
2answers
346 views

Can my broker lock my cash account if I try to use the money from a stock sale during the three-day settlement period?

I don't understand or know what my broker is trying to make me believe, but I have an excess of 75K in my account and they are pulling all kinds of stuff. I had a trade going a few weeks ago, sold it ...
6
votes
2answers
292 views

What does “/” and “^” mean in ticker symbols? How to translate these symbols into yahoo?

I have downloaded a complete list of all NYSE stock symbols from the NASDAQ website here. As it turns out, many of these symbols are not recognized by the yahoo finance page. In particular, there ...