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Questions tagged [trading]

Trading means exchanging one item for another such as goods for money. In finance, trading refers to the buying and selling of securities such as stock, options, or futures. Related tags are day-trading, trading-volume, and online-trading.

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Why is the half spread considered the transaction cost?

I know there are other questions that address this, but I'm a little confused on the intuition. Say bid is 90, weighted mid is 90.4, and ask is 91. So the bid/ask spread is 1. If I want to sell now, I ...
rmh99's user avatar
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What is the least amount of time i can own a stock to get dividend? [duplicate]

As we should own the stock at the close of trading on the day before the ex-dividend date, does the extended trading close at 7:59 PM or 11:59 PM. So buy at 7:59 PM and sell at 8:00 PM or buy at 11:...
Nayeem's user avatar
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Wiping out stop losses to create liquidity?

It is the second or third time that I read something about this theory (is it only a theory or has it been proved?) on how institutions or professional traders are often pushing prices somewhat beyond ...
noplace's user avatar
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In this chart, price seems to keep testing the same value over days. Coincidence? Or science to explain it?

Here's chart of the EUR/USD, and over the course of days, we can see that the current price seems to be tested by the low price on multiple previous days (the red line): Is this merely a coincidence? ...
trusktr's user avatar
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Doing a STP sell order with length of time consideration

I am trading stocks in Interactive Broker and crypto in Binance. One way to manage my risk is setting stop loss orders in my long positions. But there are times (particularly in crypto) when a ticker ...
Jimmy Chu's user avatar
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Do market makers do gamma hedging on option futures ES?

Do market makers do gamma hedging on MES and ES and does that impact ES prices, or is the ES price only impacted by gamma hedging on SPX and SPY according to volumes?
yassir mimouna's user avatar
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1 answer
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Interactive Brokers - API for Implied Volatility Comparison chart

Does anybody know a way how to download data from Implied Volatility Comparison chart from Interactive Brokers TWS? Is there any API method (either REST API or TWS API) for that? Or do you know any ...
Jan Jůna's user avatar
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What's the capital needed in order to achiev $500 monthly with Options Trading

I'm looking for some advice on to achieve a monthly income equal to my monthly expenses which is 500$ - I already have a portfolio of monthly dividend stocks valued at around $1,200, which provides me ...
MorMinimumWageGuy's user avatar
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How does one decide Moving average and its cross-over parameters to use

For the purpose of trading options of a volatile index, I want to understand how to decide between the following for a particular indicator, say, RSI: Assuming that the RSI changes from 0 to 100 in a ...
user173399's user avatar
1 vote
2 answers
192 views

Wash Trade Definition - market abuse

I am a bit new to trading and hope that I am making this post in the appropriate place to ask. I saw a few questions on wash trading but I am still a bit confused on the specifics (I describe a ...
jerrymchillin67's user avatar
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1 answer
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Getting introduced to the world of trading as a mathematician

I'm a mathematics undergrad. My economic/financial knowledge is very rudimentary because this world has never caught my attention - until now. I like algorithms. I'm a good programmer and know machine ...
hey's user avatar
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3 answers
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Will Brokerage Be Concerned If I Swap ("Churn") Between Two Positions on a Monthly Basis?

Disregarding the "Why?" or potential brokerage/trading fees, please consider the following scenario: I have two positions, A and B. I have $100,000 in position A at the beginning of the ...
AA040371's user avatar
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Why do futures allow higher leverage?

Why do futures allow higher leverage? Shouldn't the risk of a futures contract be the same as the spot. In that case, why would brokers feel more comfortable handing leverage to futures traders vs ...
Joe C.'s user avatar
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What does Takeout and Putup mean?

What does takeout and putup values mean in fixed income trade and how would you interpret these values?
the_brass_bottle's user avatar
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relationship between a mortgage bond and homeowner

This is a quote from Liars Poker, the famous book by Michael Lewis that details his time working as a bond salesman. Lewis Ranieri cast himself in an odd role for a Wall Street salesman. He ...
APerson's user avatar
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What happens under the hood when I place an order in the forex market?

I'm new to the field of forex trading and I'm trying to understand what actually happens under the hood when I place an order. The point is that I've read everywhere that I don't own the underlying ...
Maurizio Liguori's user avatar
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2 answers
158 views

Is Limit Order classified as Trading rather than Investing?

I had a question, and a Scholar has commented below. Sounds like you're trading rather than investing. Good luck; you're going to need it So my questions are below( despite my very long and monetary ...
puzzled's user avatar
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Is relying only on large cap stocks a reasonable trading strategy?

I have worked on a simple strategy that looks for the stock with the largest cap, buys it, keeps it until it has a 2% increase, and then repeats the process again. This is a simple strategy but ...
N N's user avatar
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References/terms to search for regarding financial instrument universe selection

When attempting to profit off of the market in one way or another, an entity, be it a fund, individual investor, institution, etc., must first decide on what actual financial instruments are to be ...
QMath's user avatar
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1 answer
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What exactly is wrong with treating two conceptually similar trading indicators as independent pieces of evidence?

Suppose you come across a financial trading system which starts by checking a security's 200-Period Moving Average, either by itself or in conjunction with the security's price data, perhaps signaling ...
user10478's user avatar
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2 answers
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Trading on Charles Schwab shortly before the market closing time: "Your request will be processed on a best efforts basis. "

I placed an ordered to buy some ETF on https://www.schwab.com/ shortly before the market closed and I saw the warning: Please Note: The market closes in approximately 3 minutes. Your request will be ...
Franck Dernoncourt's user avatar
-3 votes
1 answer
257 views

What are the upsides and downsides if one's currency exchange order is routed as an odd lot order instead of IdealPro on Interactive Brokers?

I placed a currency exchange order on Interactive Brokers from EUR to USD. Since the amount was below 20kEUR, Interactive Brokers told me that the currency exchange order would be routed as an odd lot ...
Franck Dernoncourt's user avatar
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330 views

How to properly hedge indices futures NQ by selling leveraged index options TQQQ or SQQQ?

Is there a formal futures NQ vs TQQQ options contracts hedging ratio calculation/strategy to tap on the fast decaying value of weekly expiry TQQQ options thereby creating an asymmetric risk-reward ...
surewin's user avatar
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-4 votes
3 answers
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Do CFD brokers ban profitable clients from trading on their platform, since these clients make them lose money?

Many CFD brokers make money from trading against their clients and profitable clients make them lose money. This is similar to how casinos operate. Casinos ban profitable customers. Do CFD brokers do ...
curious's user avatar
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How do we trust power of compounding with mutual fund SIP

When I search for SIP Mutual fund plans, often I see huge money returns in the long run. But when I research, it's usually mentioned as Power of compounding, that's how they're able to return such a ...
King's user avatar
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14 votes
2 answers
14k views

Is my algo trading illegal?

I have algo trading program (written by myself) and when it detects that price are going down it's going to sell shares (if I have one) wait a couple of sec/min and buy the shares on lower price. Last ...
Andrew Sasha's user avatar
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2 answers
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DOW Mini Futures Options Liquidity - Symbol YM

I am trading on the Interactive Brokers TWS platform. That is the name of the broker and the platform they offer that I use. I have noticed that there is almost no liquidity on the YM Mini option ...
ajnabi's user avatar
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1 vote
1 answer
195 views

Is the geometric mean of the price really equal to 1?

If we assume that the geometric mean of the price is 1, then the probability of a price drop of 20% should be equal to the probability of an increase of 25% (0.8*1.25=1). If so, then we have a trading ...
Randomuser's user avatar
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Terminology to describe period of time when return is negative?

These chart show the value of SPY in 1996 and 2009 Please refer to the scenario (screenshots in the link above) where someone purchased 1 share of the market in 1996, and sold at the trough in 2009. ...
the_muffin_man's user avatar
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Option trading to avoid overnight fees over a short position

I do a lot of short selling as a day trader. There is a pattern that I trade often. This one asks me to short and keep my position for several days. The problem I have is that the broker charges too ...
David's user avatar
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1 vote
0 answers
381 views

How to Close Delisted company's short position?

I have shorted OZON and YNDX last year in FEB before suspending trading and after suspending was not able to close these positions. As Companies now are in delisted mode, Broker is not giving chance ...
Malkhazi Dartsmelidze's user avatar
0 votes
2 answers
241 views

Comparing option deltas of significantly different underlyings

Please help me correct or confirm my intuition about options deltas. My understanding is that delta is the change in an option's price given a $1 change in the option's underlying. Moreover it's ...
geofflittle's user avatar
1 vote
2 answers
317 views

selling covered calls below my average cost

I have this stock more than 2 yrs and wont go up , I am planning to sell covered calls all my shares just to return my capital ... example my average cost is 5 and I am planning to sell it at a strike ...
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1 answer
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Red candlestick and volume bar on trading view

On trading view, I get the idea that if closing price is less than the opening price, then we will get a red candlestick on the price chart, and if closing price is greater than opening price, then we ...
stats_geek's user avatar
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1 answer
152 views

How do the practicalities of futures contracts for commodities work?

I know in principle how future contracts work (and correct me if I'm wrong): Essentially, provides a contract holder with the right to buy a commodity in the future at a given price. This part, and ...
bullfighter's user avatar
2 votes
1 answer
213 views

What are the downsides, if any, of purchasing bonds on the secondary market instead of the primary market?

Let's ignore the transaction fees from my broker, which tend to be higher for the secondary market. Are there any other downsides of purchasing bonds on the secondary market instead of the primary ...
Franck Dernoncourt's user avatar
1 vote
1 answer
65 views

Does a limit buy marker order ABOVE a price threshold exist?

Contrary to a classic limit buy order, I would like to trigger a market buy order only once the price exceeds a certain threshold. Does such an order type exist? (From what I understood, if I send a ...
scott_m's user avatar
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1 vote
1 answer
168 views

What happens if I place a stop limit sell order with a $1 limit?

Let's say I am looking to sell a Bitcoin on Coinbase if the price drops to a certain level. This sounds like a perfect use case for a stop limit order. So I set my stop price at the level that I want ...
Jeff Camera's user avatar
-2 votes
1 answer
60 views

Is there any currency conversion charge (including suboptimal rate) when purchasing an ETF whose underlying assets are in a different currency?

Example: Amundi Index Solutions - Amundi S&P 500 UCITS ETF C EUR. Traded in EUR but underlying assets are in USD. Assume I buy it from an assurance-vie account based in France. Is there any ...
Franck Dernoncourt's user avatar
2 votes
1 answer
146 views

How market orders are filled?

When we look at the stock price S of a stock, then if I am correct S is equal to the average between the highest bid and the lowest ask for this stock. Hence since the highest bid is lower than the ...
ConfusionMatrix's user avatar
1 vote
0 answers
95 views

Judge the amount of money to trade

I have been day trading for about a year. I got some statistics on a stock market pattern. The latter gives me an 82% probability of occurring and an expected gain of 13% per trade. I'm having trouble ...
David's user avatar
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1 vote
2 answers
7k views

How is it possible to buy call options with a strike price below current market price?

I'm a newbie with all of this. I've been reading on call options and from my understanding, you're paying some "premium" to buy an "option" to buy the stock at a certain fixed ...
streampaw's user avatar
-2 votes
1 answer
102 views

Head & Shoulders and Bullflag Rectangle patterns [closed]

Video: https://www.youtube.com/watch?v=3SELauVQ1Tk The above video describe several pattern with high degree of success. I would like to implement two of them, i.e. Bullflag Rectangle pattern and the ...
David's user avatar
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0 votes
0 answers
58 views

How do market-makers make a profit in the bond markets?

Do they sell at ask, buy at bid? Meanwhile, investors buy at ask and sell at bid. So, do the market-makers profit from the bid-ask spread?
darkuss's user avatar
2 votes
1 answer
96 views

Why is EUR/CAD market open now?

As far as I know the Euro follows London times (closed right now), and CAD session is almost the same as USD session (closed right now as well) so why is EUR/CAD market open and trading right now?
Aspiring Dev's user avatar
-1 votes
1 answer
181 views

What's the relation between free margin and drawdown? (and leverage)

I'm trying to understand whether different leverages can affect the drawdown in forex/CFD trading. I have noticed that given the same lot size, the bigger the account leverage, then the bigger is the ...
Gerard Bosch's user avatar
3 votes
1 answer
50 views

Selling covered calls when the contract is over 5x the cost of the stock share

I just discovered that a stock I've held onto a few hundred shares of for a while, which is currently trading for about half what I paid (under a dollar a share) has an options contract for a covered ...
Elise C's user avatar
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1 vote
1 answer
80 views

How would one profit from an accurate forecast of tomorrow's price varience?

If one had a reasonably accurate forecast of the variance of the price of some market security, such that one knows approximately what the price variance will be tomorrow, but not whether the price ...
andrewH's user avatar
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1 vote
1 answer
117 views

Risk Per Trade Calculation

I have a little confusion regarding my risk per trade management. I am unclear if I need to calculate this absolute amount each time with the new account value or the risk per trade is calculated once ...
Jôsùå's user avatar
0 votes
3 answers
524 views

Trading options and stocks under $1 per share at Charles Schwab shortly after the brokerage account creation

When creating a brokerage account at Charles Schwab, I see: January 05, 2023: Funds post. You can buy most securities, but we restrict withdrawals and trading of some securities, including all ...
Franck Dernoncourt's user avatar

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