Most Recent Tipping Monkey Blog Entries

Alpha hedge fund

veryanallen — Wed, 06 Mar 2013 18:17:00 GMT

Hedge fund alpha? Alpha dog or beta dinosaur? In canine circles alpha refers to the top dog. The top dogs in the investment world are the alpha generators not beta bandits. There is no connection between AUM and fund quality and a big hedge fund is often a very bad investment compared to a top hedge fund. But regardless of size, St. Bernard or Chihuahua, how to identify alpha dogs?

The main reason to put money into hedge funds is RISK-ADJUSTED performance. If you are certain of a bull market there is no need to put money in hedge funds. Beta from index funds is all that an investor requires assuming they can stomach the risk which I certainly can't. Isolating and measuring alpha can also be difficult. Past betas and alphas are unstable and do not necessarily carry predictive information on the future.

Absolute returns can't always be considered alpha. In fact many alphas are negative after looking at the risks and factor exposures taken to generate that performance. Identifying alpha dogs in the financial world is hard but not impossible. True alpha is what the 2% and 20% fees are for. Some investors choose to pay intermediary allocators an extra fee to locate that alpha and conduct expensive and time consuming manager due diligence.

Alpha is a measure of value added performance but alpha is often evaluated incorrectly, especially with hedge funds. For example, take a USA equity long/short hedge fund. The closest security universe might be the Russell 3000 and typical long-biased exposure is 130/30 long and short. So it has 100% NET exposure like the index and the fund generated alpha if it made MORE than 17% after fees last year. Yet the manager will often claim all the absolute return is alpha. Nonsense.

An added complication is that if its longs were high beta and shorts were low beta, the hedge fund would have needed to make an even higher absolute return for ANY alpha. Alpha is the return AFTER allowing for dependence on beta risk factors. If the hypothetical fund's individual longs had an average beta of 1.5 and the shorts a beta of 0.5, then alpha is only ABOVE a 30.6% return.

Suppose you set up a hedge fund that only invests in countries starting with "T"- the T-fund. Last year Turkey, Thailand, Tunisia and Trinidad were mostly difficult markets which is somewhat at odds with the conventional notion that "every" emerging market performed well. If the T-fund returned higher than risk free rates last year then that fund is an alpha dog.

Conversely take the C-fund, investing in China, Czech Republic, Chile and Canada. Those stock markets went up a lot so there was plenty of beta. The way to assess the C-fund for alpha is to look at its long/short gross and net exposures throughout the year on a daily basis, DEDUCT the net beta contribution of the closest stock indices to their universe, and then see what alpha is left. Many funds with "good" performance last year actually generated NEGATIVE alpha. Portable alpha is not even possible in many cases where the underlying market is not liquid or hedgeable.

In the connected world we now live in, there are no exotic countries so there can be no exotic beta; there is just plain old beta. Alpha however is ALWAYS exotic since it takes exotic feats of exploration and discovery to generate. Suppose a multistrategy "do anything, go anywhere" hedge fund increased the capital allocated to India 12 months ago. That is an alpha decision. An increased risk budget to Indian trading and investment opportunities.

If the fund then hedged its India longs with shorts, Nifty index put options, single stock futures and credit default protection, then that is an alpha dog decision. The best due diligence question to ask all these India focused "hedge funds": "How would you have done if the BSE Sensex had been NEGATIVE for the year?" Some funds who completely missed China and India rallies are now herding in on the long side. They will lose badly in the coming bear market. Those markets are sources of alpha NOT beta.

Investment Professional

veryanallen — Thu, 28 Feb 2013 07:14:00 GMT

Hedge fund exam? It's always amazed me how other industries have reasonably tough tests of basic professional knowledge - doctors have MDs, lawyers have bar exams, pilots to fly planes. But finance just has easy tests like CFA, CAIA, Series 7, Series 66, CIMA, CFP etc.

Not surprisingly the world's top investors typically have none of them, favoring practical experience. Name anyone that learnt to drive, cycle or swim from a book. Nobel prize "winners" in economics are infamously negatively correlated with common sense and financial acumen.

It's time for the Hedge Fund Test. To assess the 0.01% who do and the 99.99% of financial professionals who don't have what it takes to succeed in running a hedge fund.

1) Portfolio management: Today your ten largest longs all went bankrupt and ten biggest short positions were bought out at enormous premiums by overcapitalized private equity funds. You

i) smash your phone, trash the Bloomberg and jump out of the window

ii) write an op-ed for the WSJ, appear on CNBC and line up a dozen conference keynotes to declare war on incompetent CEOs

iii) bit of noise in the markets today - good thing my hedge fund is hedged and has 1,000 other positions

iv) move the "distressed" longs to the special situations book and make higher offers on the LBOs and appoint myself CEO

v) shut down the fund, lie low for a month, then start a new one with a fresh high water mark

2) Risk management: If thermonuclear war, a Richter scale 11 earthquake, a new ice age, an alien invasion, a Texas-sized asteroid hits earth and a global Ebola pandemic all occur tomorrow morning, how much money will your fund make and how much will "cheap" index funds lose?

i) I never think about my "event-driven" fund being driven by events

ii) I pick stocks by visiting companies, studying balance sheets and finding value in a glorious vacuum completely immune from macroeconomics, geopolitics and black swans

iii) That's such a ridiculous scenario I haven't stress tested for that particular set of events and the 95% VaR number tells LPs everything they need to know

iv) I would be up at least 50%. I always have plenty of shorts and puts. I run a hedge fund not a closet long only fund

v) Might take an initial hit but make it up trading subsequent volatility. I've been investing outside earth anyway. Planetary bias is as dangerous as national bias in portfolios

3) Structured products: You receive a term sheet for a 20% yield AAA rated Iraq SPAC, SIV-lite, PIK-toggle, Iceland Krona quanto, digital Bermudan rainbow knockout spreadtion, synthetic Zimbabwe mortgage-backed subprime CDO cubed, CPDO, lumber correlated, rock-salt linked, orange juice variance swap, carbon credit, catastrophe reinsurance PRDC cliquet reverse floating callable tranche. You

i) Quickly price it up yourself and arbitrage the bank's copula based models

ii) Take all they've got but ask them to restructure the coupon up to 30%. Carry calculations soon so remind them of the need for marks to - your idea of a - market

iii) Pull the line, inform the SEC, change your name, email address and phone number

iv) Call your favorite search firm and poach that firm's product structuring team

v) Tell them no interest but many "sophisticated" funds love high yield toxic waste "rated" AAA by some firm they paid to rate it AAA

4) Quantitative analysis: This morning you were thinking about the turbulence and viscosity of the markets when you found the full solution to the Navier-Stokes equations. You

i) Publish to worldwide acclaim, a Fields medal and the $1 million Clay mathematics prize

ii) A day's pay? I'd prefer to keep it to myself and perhaps use the ideas in a model to gain an edge. Besides if the Clay is not enough for Grigory Perelman

iii) Navier-Stokes? Grisha? What's this got to do with making money?

iv) Intellectually satisfying but I already solved a specific case numerically with a large eddy simulation

v) Forget it and head to work. Just not into this quant mumbo jumbo. If it's cheap I buy and if not I short sell. Fundamental analysis and gut trading are what works

5) Stress test: Hint - A googol is 10^100 which is tiny compared to almost all numbers

A) A googol of fund managers are asked to choose a whole number between one and a googol. They are each told they will get to manage USD 1 googol at full fees for googol year lockup if the number they choose is half the arithmetic mean of all the numbers selected. What number should you pick?

B) A googol of monkeys type at a googol of computers for googolplex years at the Googleplex. What is the probability of a monkey typing out the exact content of well-known hedge fund firm Berkshire Hathaway's annual letters to shareholders in sequence?

6) Human resources: You need a performance rainmaker/new strategy developer. Your shortlist comprises the following candidates. You can only hire one. Who?

i) an MBA with many years prop trading experience at prominent bulge bracket white shoe firms

ii) a PhD in Physics with no financial knowledge

iii) a private trader, uneducated, inarticulate and illiterate, made over 100% in each of last ten years

iv) a psychologist with no financial knowledge

v) a "Nobel" Prize laureate in Economic Sciences for the non-sales role

7) Global market knowledge:

A) What is your favorite stock on the Armenia Stock Exchange?

B) Is the Bhutan Ngultrum over or undervalued?

C) What price would you pay for Cuban sovereign distressed debt?

D) Denmark's DONG issued a 1,000 year hybrid. At what price would you short it?

E) Long Estonia/short Egypt or vice versa?

8) Market outlook: Investors are urged to bet on equities for the long haul. Stock indices in a few countries have generally risen over time. In some others they fell to zero.

A) What is the likeliest price for the Dow Industrials in one billion years?

B) What would you pay today for a European-style Dow 15,000 strike call option expiring then?

9) Forecasting: To make consistent absolute returns at low risk the one thing that is truly necessary is:

i) To be really, really intelligent. Really

ii) To use common sense since it is not so common

iii) To be a brash, brilliant, street smart, genius star trader

iv) To work harder and more effectively than 99.99% of financial "professionals"

v) To follow closely what the sell-side strategists, economists and analysts are saying

10) Experience: From memory what were your ten best and ten worst trades and the exact levels of entry and exit and precise ex ante reasons for the trade? Also from memory what are your ten largest current positions, their average entry price and stop loss point, percentage of total portfolio and what hedges do you have in place?

******** End of Test ********

If you score six sigma above the harmonic mean we might contact you. If not the examiners wish you all the best for your career in long only where the fees you "earn" will be vastly higher than the value you deliver.

----------------------------------------------------------------------------------

To source good employees technology companies often use such questions; Google has the Google job test and Microsoft asks people how they would move Mount Fuji. The Hedge Fund Test does similar psychometric analysis for hedge funds.

Invest 2.0

veryanallen — Thu, 24 Jan 2013 02:08:00 GMT

Clients are priority. Working with and advising individuals and institutions on their investments has always been my core skill so I'll be focusing on doing my best for existing and new clients. I hope you found Hedge Fund Blog informative.

Clients have ranged in asset ownership from $188,000 to $300 billion. A lot of what I do is assessing investment consultants, fund managers and financial products and when necessary recommending changes. I also design master portfolios for specific asset/liability needs.

The philosophy is simple. Deliver substantial value. Skill is the only investment grade asset. The biggest bull market is the growth in demand and need for quality financial advice. Don't accept the average in anything.

Finance offers a big data set to analyze. As a data scientist by background, it's my job to help clients differentiate vast noise from rare opportunities. Empirical reality outperform theoretical beliefs.

Over 8 million visitors in 158 countries visited this site since it began and I am grateful to everyone I corresponded with and especially to those who became friends and clients.

The posts will remain on the web. The content was my own and does not reflect the views of any client, colleague or my employer. I travel often to meet with investors. Please drop me an email if you would like to meet up.

Sincere regards

Veryan

HedgeFundBlog@gmail.com

PS The 5 most cited Hedge Fund posts.

1. Best hedge fund

2. Hedge fund blog

3. Top wealth manager

4. Asset allocation

5. Emerging markets

NCDEX Live Price and Trend For Today

trademaster — Tue, 22 Jan 2013 23:29:18 GMT

Chilli prices are projected to trade on positive note on extended fresh buying. Expectations of fall in production from major grower Andhra Pradesh are likely to keep chilli prices firm. However, chilli prices might witness decent corrections amid sudden rise in arrivals at spot markets. Nonetheless, this correction might remain short live as good demand for from many processing units in Gujarat might support chilli prices. Fresh arrivals coming at market are having high moisture content hence; no major impact would be seen in prices.

Read Full Report with Live trend here- NCDEX Tips

Long only fund

veryanallen — Tue, 08 Jan 2013 10:33:00 GMT

Long only hedge fund? Brand extension is smart but brand destruction is dumb. What if Ferrari entered the horse and cart industry, Apple manufactured tape recorders, Amazon opened bookshops on main street and Google started delivering snail mail? Weird? Investors want absolute returns, risk management and financial innovation so why would a TRUE hedge fund manager retreat to archaic long only?

MOST stocks go DOWN over time! No shorts means no hedge. Long only is not sufficiently diversified. Hedge fund firms that set up long only funds commit commercial suicide. Don't fall for the "unconstrained" monicker. Unconstrained applies only to the LOSSES they WILL deliver. I'm advising my institutional clients to avoid ALL long/short products offered by firms that set up long only vehicles. Far too risky.

Long only is just an asset gathering ploy by weak hedge funds that failed at long/short. I've been investing in absolute return strategies for a long time. I never have and never would consider a long only fund. Much too risky for conservative investors. Redeem from former "alternatives" firms that try to raise long only money. Such toxic waste has no place in risk averse portfolios with absolute liabilities to fund.

By definition most hedge funds cannot be long only. Unless a manager is able to generate absolute returns INDEPENDENTLY of underlying beta risk factors and asset class up moves then it is NOT a hedge fund. Why would a real hedge fund firm destroy its reputation and track record with long only? Long only is wrong only. No hedging renders a fund too risky for long term investors that seek absolute returns not relative returns.

A good hedge fund either hedges or acts as a portfolio hedge. Strategies like short only and distressed debt, for example, do not inherently hedge themselves but perform as a portfolio hedge. However it is highly unlikely that a long only equity or credit fund can achieve returns independent of their underlying asset class. They must manage risk and that means having short sales and hedging with derivatives.

Long only firms may try to run what they say are "hedge funds" and weaker alternative investment shops might attempt to raise long only money but the product separation is distinct. If you are long only you can't be hedged. One fails to manage risk, the other tries to. Short selling doesn't actually need to be profitable; it is about REDUCING market exposure. Generating alpha is the function of real hedge funds not repackaging beta. There is no such thing as a long only hedge fund and never will be.

Hedge fund blog

veryanallen — Tue, 01 Jan 2013 04:07:00 GMT

Hedge fund manager, a traditional relative return fund and a passive professor are flying north to present to an institutional investor in New Zealand. As the hedge fund manager's private plane lands they see one purple sheep in a field.

Index idol says "Every kiwi sheep is purple! I must buy them all now. At any price the farmer asks no matter how expensive. No need for analysis or due diligence. The market is always right because it's efficient. It's not my money anyway. I have academic tenure and a Nobel prize. Risk free...for me."

Long only luddite says "Some kiwi sheep are purple but the professor says they all are and I am benchmarked to the index so I must buy also. Can't risk my tracking error. It's not my money either. I get paid whether clients win or lose."

Hedge fund blog says "All my money and my family and friends' money is in the fund so I analyze potential investments more closely. The endowment that pays the professor is also a client as well as the long only dude's pension plan. They need absolute returns because you can't eat, pay faculty or liabilities from relative returns in bear markets.

In that field apparently there is a sheep, one side of which appears to be temporarily purple. This may be due to chemicals in the sheep-dip, an accident with dye or paint, an optical illusion, a practical joke or a smudge on the airplane window.

I will study sheep fundamentals and talk to shepherds, shearers and wool merchants. My quants will gather ovine data and conduct extensive statistical analysis, mathematical modeling, stress tests and scenario simulations. Perhaps, after exhaustive research, I can decide whether to short sell or even buy that apparently purple sheep, depending on its value."

Which fund would YOU invest in? Who should get the mandate? Who is most likely to generate the highest returns? Whose fees represent the best VALUE for the work? What manager is the "cheapest"? Would an investor truly following the prudent man rule choose an index fund given the fiduciary duty for due diligence in selecting appropriate investments for beneficiaries?

Which fund offers alignment between client and manager interests? "Cheap" index funds are the joke.

Hedge fund managers can afford private aircraft because they work much harder and deliver vastly more value to their ciients.

Nobel prize in economics

veryanallen — Fri, 28 Dec 2012 02:26:00 GMT

Nobel prize? Pricing options is difficult but finding dumb Nobels is easy. The 1997 award to Myron Scholes and Robert Merton and that is with the bar set very low in a dismal field. The Black-Scholes formula has led to many problems for investors but is still used to misvalue options. Fake "Nobels" are more 1960s economics lunacy that must be put out of its misery. Urgently.

The Nobel Endowment shrewdly refuses to pay for a prize in economic "sciences" so Swedish taxpayers take the hit. Merton and Scholes are to financial engineering what the Titanic was to marine engineering. Neither would have survived the rigorous hard sciences but in soft economics they are superstars despite over 40 years of staggering incompetence! Tenure has been a heavy cost on alumni contributions paying for their "learned" presence.

It devalues legitimate Nobels to let such an error stand. As REPLACEMENTS and for their roles in demolishing the delusional dogma of efficient markets, I nominate hedge fund managers George Soros, Warren Buffett and James Simons. Each separately proved over long time periods using very different strategies, the falsity of always "correctly" valued securities.

The Swedish Central Bank needs to recognize people who get it right. The Literature Nobel prize is more suitable for Scholes and Merton. Rarely has such fantasy and fiction had such impact. Anyone using stochastic calculus to "price" derivatives is wrong. Very wrong. Garbage models are STILL being used on Wall Street and the results WILL be ugly. Some even use them for credit analysis! Get short of banks "normal" models.

I've probably read every paper written by the "Nobel" dudes and they got little right. The mathematics is correct but the simplifications are silly and conclusions are crazy. Rational investors, random walks with drift, continuous time, constant volatility, lognormal distributions, geometric Brownian motion, heat diffusion in finance(?), stocks that move like gas molecules(??) - give me a break.

None of those assumptions has the remotest applicability to financial markets. Their work does NOT approximate how securities behave. There is no theoretical basis or empirical relevance of their work to derivatives pricing. Amazing such rubbish is still used. More problems ahead for anyone using models derived from Black Scholes.

The 1970s may be different to today but, even then, if you had REALLY come up with a way to price options accurately, would you publish OR would you use it to make money? Just because Black-Scholes and Merton's work makes calculating option prices simple does not make it correct. Most of "Wall Street" uses stochastic calculus that can be traced back to it.

Being widely used does not ensure proof; all it guarantees is a LOT of people will be wrong. Sure you can relax many of the assumptions and the "magic formula" still seems robust. Many would regard this as heresy but Black-Scholes and the "improvements" are useless for hedging and trading options. Incredibly some very stupid people are using Gaussian assumptions to price CDOs! Oh dear.

I arbitraged those who used the "elegant" equation baed on absurd assumptions for years. My best quarter was summer 1998...LTCM. Try finding nickels in front of the steamroller and you will eventually be crushed. It is much better to be riding on the steamroller and crush such fools. The Long-Term Capital Management debacle was blamed on leverage, the Russian default and the trading team. While those had a role, LTCM was primarily a test of Scholes and Merton's rational market theories and the result was INEVITABLE. Short selling of options was the primary culprit based on their model showing volatility to be overvalued and misguided faith that security prices must "revert" to their idea of "correctness". The Black Scholes option "formula" is only useful for finding what an option is NOT worth.

If you short options you are short volatility; if volatility goes up you are quickly in trouble and the more the market moves against you the bigger your LOSING positions become. The more hedging you do, each time locking in a loss, pushes the market more against you especially if you are a big fund and massively short vol. There is less liquidity in options, especially long-dated ones and when marketmakers and other option liquidity providers sense oversized positions happily make it very difficult and expensive to cover that short vega exposure. Forcing LTCM into a vega short squeeze was not difficult for the market.

My options pricing model, non-Black-Scholes-Merton, non-stochastic methodology of course, could not reconcile the cheapness at which LTCM was selling volatility swaps throughout 1997/1998. When turbulence hit they had no hope; the subsequent revelations of massive leverage were a reflection of the extreme shortness of vega, and gamma, that grew to dominate and devastate their portfolio. Leverage was always high but it turned into hyperleverage because they failed to understand the dangers. Long date vega gets illiquid when implied volatility rises sharply.

The Swedish Central Bank, in conferring Nobel status on the oxymoronic "economic sciences", devalues the work of REAL scientists, writers and peacemakers. With rare exceptions, economics Nobel prizes have been awarded for either being competely wrong or for stating the obvious and then having your academic buddies say how clever you are for your "insights". Physicists, chemists and medics must endure decades of scrutiny and skepticism by many independent scientists yet economists have a laxer and in-bred peer "review" structure. To encourage such obviously erroneous assumptions shows how structurally flawed the "discipline" is.

The family of Alfred Nobel are rightly opposed to an award for such "science". Nobel himself was EXPLICIT in his will for the FIVE fields he wished to endow. But if the Economics Memorial prize must endure it is time the people who receive it actually merit it. For the anti hedge fund brigade it it worth noting that the Nobel Prize foundation considers true hedge funds to be safe securities. That is how they invest the endowment to award the REAL Nobel prizes.

Yale endowment

veryanallen — Mon, 12 Nov 2012 22:25:00 GMT

David Swensen manages a fund of funds for the Yale endowment. Bizarrely he says he hates funds of funds so why hasn't he quit? He also has a new book out called Unconventional Success but a better title would be Unconventional Luck. If Swensen truly believes his comments on hedge funds then we can safely conclude that his returns were due to luck not skill. Alternatives are ESSENTIAL for Yale's portfolio but apparently not for yours. He loves high risk illiquid leveraged long only for people as "clever" as he thinks he is but the unwashed masses should make do with index funds! The coming bear market will reveal how "smart" Swensen really is.

The so-called "endowment model" is too risky for endowments. Swensen's TRUE risk-adjusted performance has been terrible. Almost all his "outperformance" has been due to leveraged beta NOT alpha. He takes far more risk than is prudent. Swensen deserves some credit for seeing earlier than his "peers" the need for alternatives so why backtrack and urge Mom and Pop into "low cost" index funds? If simple asset allocation and "cheap" passive are all Joe Sixpack needs why does he have so much alternatives in the endowment portfolio? Why not put Yale's money into ETFs if they are so good? Why hasn't he handed all the endowment to passive funds instead of "pioneering" portfolio management?

Swensen says investors not as good as he thinks he is should not invest in hedge funds. He runs a fund of funds but thinks all OTHER funds of funds have no value! Many investors want what good hedge funds deliver and accept the RARE chance of fraud by bottom tier speculators that would never pass a thorough due diligence process. A large subset of investors like what a fund of funds provide and are prepared to pay the extra fees to take care of due diligence, portfolio construction and monitoring. It's CHEAPER than attempting to do it themselves. It is worth noting that Swensen avoids several of the BEST strategies and most of the top managers.

If ever there were a strong candidate for mean reversion in performance. Skill persists but luck does not. I suspect Swensen's complaints have a lot to do with the inability to negotiate on fees, access and liquidity anymore. Demand is so much larger than supply in the QUALITY absolute return space and it is frustrating some people who once were able to enjoy limited partner power and side-letter favoritism. His earlier Pioneering Portfolio Management book is as insightful as lottery winners disclosing how they picked their numbers. Differentiating luck from skill can be difficult but not in Swensen's case.

Summarizing Unconventional Success: profit orientated mutual fund firms are bad whereas non-profit fund management firms are wonderful. The notion that not for profit fund managers must be superior is very bizarre. Incentives are the driver of any functioning economy and Swensen's beloved Vanguard and TIAA-CREF are in the BUSINESS of allocating capital to EARNINGS generating companies. As Swensen ought to have learnt from the funds he invests in, incentives are essential if you seek strong risk-adjusted returns. His inconsistent "logic" is a red flag.

Hedge funds charge an incentive fee and so attract the highest quality portfolio managers and traders; the better investors do, the better the managers do. The profit motive delivers superior products and choice to consumers in all business sectors and the financial world is no different. Unlike good hedge funds, neither Vanguard nor TIAA-CREF has made a cent in many years for the unfortunate investors in their "fabulous" flagship funds. Low cost long only can be VERY expensive. DO NOT INVEST in "passive" funds. The Yale endowment doesn't. Why should you?

Extending David Swensen's thesis perhaps we should restrict the purchase of ALL individual equities by anyone except him because Enron, WorldCom and many other 100% losing stocks lied to investors. Perhaps regulators should ban all collective investment vehicles because of the extra fees. People know if they do their homework and diversify they will make money. Either way, EVERY investor, big and small, institution or individual, needs a LARGE part of their portfolio in proper hedge funds. Just like David Swensen.

As for his infatuation with ETFs, Swensen gets half marks. They are sometimes a good vehicle for trading but certainly not for static long term investment as he advocates. Futures are usually superior to ETFs in transaction cost and liquidity terms. You can ALWAYS short futures not so with ETFs despite the claims. Bond and commodity ETFs are unproven and often poorly structured while interest rate and commodity futures have been around for many decades.

I'll take the S&P 500, FTSE, DAX, STOXX and TOPIX futures over QQQ, SPY etc every time. Ditto for JGB, treasury and crude oil futures. ETFs can be good when there is no associated liquid future; for example the REIT or sector ETFs. Also ETFs pay dividends but futures don't so you have to balance the better product against the dividends if they are high enough. You don't have to rollover ETFs but with futures you don't tie up as much cash for margin. It is a trade off but futures are usually the optimal vehicle.

MCX TIPS TODAY

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Share Market For Today:

trademaster — Thu, 01 Nov 2012 23:25:12 GMT

The Indian equity benchmark indices continued to trade higher. But the NSE Nifty still was not able to breach the 5,700 mark, it touched intraday high of 5,697. The BSE capital goods index outperformed the other sectoral indices; it was up over 1.5%. Strong buying was also seen in realty, auto, metal and banking stocks.

Stocks like ITC, Reliance, ICICI Bank, HDFC Bank and Infosys were positive contributors to the Sensex. However, HUL and Bharti Airtel were the negative contributors.

The Sensex was up 149.61 points or 0.81% at 18711.31, and the Nifty was up 45.10 points or 0.80% at 5690.15. About 1465 shares advanced, 582 shares declined, and 1,410 shares were unchanged.

We expects the market to consolidate for few more months before breaking above 5,850 levels. The Nifty is likely to trade in a broad range of 5,500-5,850 now. The overall trend seems to be positive, but we will have to be patient.

The Technical Report suggest that Nifty is back into that key range of 5,630-5,730. If you are looking for a bigger move on the market on the upside then you have to watch for 5,730 again. If it can be taken out then there will be a resumption of the uptrend.

Top gainers on the Sensex were Bajaj Auto at Rs 1,887.30 up 2.29%, L&T at Rs 1,662.60 up 1.92%, Hero Motocorp at Rs 1,937.55 up 1.70%, M&M at Rs 914 up 1.68% and BHEL at Rs 230.40 up 1.68%....

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Free trading signals

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You can become rich... (ENGFF)

joneecoca — Fri, 01 Feb 2008 09:42:36 GMT

I`m sure you were STRUCK by my title.

I would be too, but this time I ain`t lying.

Stock : EnerGulf ( ENGFF )

This company is about to strike a good amount of oil and gasoline in Azerbaijan.

This can lead to some cash if you make good investments. It can also be an oppertunity of quick cash.

So hurry. Stocks as of now are 2.12 or something like that per stock. You can buy a few hundred and be rich next week.

Heres the article so that you could see for yourself.

http://www.resourceinvestor.com/pebble.asp?relid=39247

Enjoy

- Jon

The 14 year old genius

Intraday Trading Strategies For Begainers

trademaster — Thu, 11 Oct 2012 03:02:51 GMT

If you are a beginner for day trading, we will discuss here the Forex day trading strategies for you. When people heard of "day trading," they think it is the act of selling or buying a stock in a given day. A day trader may seek to create profits by having a large amount of leverage in a capital in order to have an advantage in price movements that are small in indexes or highly liquid stocks. We will look here the common strategies of daytime trading that may be used by a retail trader or beginner. Your early strategy is that you have to know that certain stocks are very ideal trading candidates. A typical type of day trader may look up for two things found in a stock that are the volatility and liquidity.

Volatility is just a measure of the daily price range that is already expected- the range operated by a day trader. More volatility will also mean greater loss or profit. On the other hand, liquidity allows a trader to join or exit a stock using a good price like low slippage or tight spreads. When you already know the kinds of stocks you want, you have to learn in identifying possible entry points. You can use the intraday candlestick chart tool that uses candles to provide raw price action analysis. There is also a level two quotes that looks for orders that are happening. Real-time news service tool can tell you whenever any news will be out as news can move stocks.

Another strategy of trading during daytime is finding or identifying a target. This strategy depends largely on the trading style you are using. You can also use scalping strategy that involves immediate selling whenever a trade will become profitable. There is also a fading type of strategy which is risky that involves stocks shorting right after a rapid moves upward. Another is daily pivot strategy involving stock's daily volatility profiting attempting to sell during the high of the given day and buying during the low of a day. A strategy that makes trading on strong trending moves or news releases is called momentum strategy. You can observe that even the entries of the strategies of day type of trading rely on the tools that are used in traditional or normal trading, their exits is where you can find the differences. All in all, remember that this type of trading can be a difficult skill to be mastered.

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Hawaii hedge fund

veryanallen — Tue, 16 Oct 2012 22:02:00 GMT

AlPha from alOha? Honolulu has the highest Sharpe ratio for city climate in the world. It is not so much temperature but variability of temperature that matters. When people visit Hawaii it‘s certain they won't require a coat or suffer heatstroke. There is a lesson for investors: averages count but consistency, low volatility and limited downside matter more. Don't freeze in or get burnt by risky long only.

Passive index fund = Siberia, good hedge fund = Hawaii. There are Siberian tourists in Hawaii but no Hawaiian tourists in Siberia. But traditional investors often visit Siberian bear markets. Instead I prefer reliable performance. More people in the northern hemisphere wish they were in Hawaii in January than July. They don't like bear markets either so why do they invest in long only? Invest in good hedge funds since we don't know when the economic winter will hit.

Honolulu climate has a small range and standard deviation whilst places elsewhere usually have very high volatility during a year. Honolulu's warmth Sharpe ratio is vastly superior. The worst city climate Sharpe ratio belongs to Yakutsk. Looking at downside risk, Honolulu has never recorded a temperature below 50 degrees Fahrenheit so its Sortino and Omega ratios are INFINITY.

Good hedge funds may or may not match stock market returns. But they outperform equities on a depth of drawdown and return on risk basis. Their performance, volatility and control of the downside are a better fit for conservative investors who value consistency. It is how a managers perform during a cold winter not sunny summer that matters. Construct portfolios and invest in funds that deliver absolute returns with the RELIABILITY of Hawaiian weather.

Commodity Evening Report |MCX NCDEX at Low Trend today

abhinavpatel — Thu, 11 Oct 2012 04:15:32 GMT

Commodity Evening Calls And live MCX NCDEX price == >> Free Silver Tips

In the Evening commodity round up both segment of commodity market are trading at lower end.MCX Gold silver have red... and awaited bigger price falls for upcoming festivals even as the yellow metal reversed from its highest level in more than a week... tips at -- MCX Gold Tips

commodity market updates and live tips today

abhinavpatel — Wed, 10 Oct 2012 02:28:53 GMT

Visit our website for live price and tips for commodity market == >> Free silver tips

Commodity Updates :- crude
oil prices is expecting to trade on weak note on the back of weak
global market sentiments along with strength in the DX. Further,
expectation of rise in the crude oil inventories is likely to exert
downside pressure on the crude oil prices. However, any fresh tension
in the Middle East may cushion sharp fall in the crude oil prices. On
the domestic front depreciation in the Indian Rupee will cushion
sharp fall in the crude oil prices on the MCX... Gold Tips Today

Freak trade to offset losses from NSE

trademaster — Mon, 08 Oct 2012 01:21:54 GMT

On Friday, the National Stock Exchange (NSE) in the cash segment circuit freeze due to a fall of 15 per cent has appeared in several stocks. Nifty hit the lower circuit in a single stroke on Friday and at 9:50 in the morning in the cache itself Trading was halted. Nifty fell 900 points and Sensex 300 points. The NSE began trading again at 10:05. Nifty segment clamp circuit loss and the cache is a blow to traders. Businesses should close on BSE.

According to the reply of the 650 million shares of the circuit there is a surprise start and NSE should the consequent losses. NSE Investor Protection Fund have him make profits and losses so that traders can fulfill. However, he believes that the NSE should not cancel a deal on Friday.

The heavy losses to small investors and their confidence in the market suffers. Such incidents should not have happened with the NSE SEBI should take steps. FDI in retail would only declare the money when the incoming government to support it.

The government is also working quite right to say that reform was not working and they were confined for a long time. In view of the forthcoming elections in the coming budget will announcements. He also announced that the current climate of the country is fine. 5.5 to 6 per cent in fiscal year 2013 and the country's GDP growth is not expected to have less risk of being downgraded.

Invencr Growth & Securities of the MD Nagaji Rita's Freak Friday's trade deal that the company has made a profit of Rs 16 crore traders. Deterioration of the market that day were in the company's book Kafi deals.

Rita's Nagaji that wrong is wrong to punish the whole deal Emkay Global Broker and any punishment for it should not be so large. According to market exchange rates accounted for 5 per cent by value investors can estimate the profits or losses.

According to the NSE now Rita Nagaji the deal is canceled, investors, brokers will have to agree but it is not going to get resolved. However, if the transaction is canceled, then everyone believe it will be announced. Exchanges should see that such incidents are not repeated. It should be taken to fix the system.

The Indian market is now consolidating, after the recent rally. The last 400 points rally on the Nifty has mainly been because of the measures announced by the government. Looking at the way the market has gone up, he says, a consolidation or a time bound correction, before we make an attempt to go up to 6,000, seems very much possible.

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MCX Gold Commodity Report For Today

trademaster — Thu, 04 Oct 2012 04:31:01 GMT

Prices managed to stay above $1780 an ounce as concerns over upcoming economic events around the globe impeded investors putting fresh bets on

bullion. Traders probably stay vigilant ahead of European Central Bank’s rate announcement along with President Draghi’s press conference today and

the key US employment release due on Friday. Earlier, US private employment sector showed a surprise rise in employment by adding 162,000 jobs in

September. However feeble economic releases from the Euro zone and China benefited bullion. Spain’s Prime Minister had denied the reports of

impending request for bailout earlier, raising uncertainty over the Euro zone debt crisis. Contracting Chinese non-manufacturing data is signaling a

deprived economic growth while the markets are closed this week for national holiday. Weak economic releases probably open room for fresh economic

stimulus measures from various central banks that could assist bullion further. At the same time, investment demand for gold remained held firm with the

holdings of exchange traded funds inching up but just shy of the record high hit in late September.

Since the mid of September prices have been consolidating inside $1637-1791 regions. Recent attempts to burst above the recent swing resistance of

$1791 were unsuccessful and prices traded choppy. Looking ahead, if prices stay above the minor support of $1760 the trend looks positive and have

room for further upside, initially towards $1800 which if cleared convincingly could target $1820 immediately. However, a direct push above $1825 with

streaming volume could test the all time peak level of $1920.30 an ounce in its next move. Enduring candlestick formation is not providing signals of any

strong liquidation or rally; hence prevailing consolidation is likely to continue in the immediate run. Prices have to close below $1730 to make much

bigger momentum to test $1710/1680 or further more. Volumes have been steady but RSI is turning lower from overbought area. Anyhow, the gold Euro

correlation has eased below its one year high of 0.96 to 0.88.

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Free MCX NCDEX Commodity Tips Today 4 october

abhinavpatel — Thu, 04 Oct 2012 00:43:10 GMT

Visit Our website for gold,silver,copper,crude oil,natural gas,ncdex tips -->> Silver Tips Today

MCX
Crude Oil Updates :- Crude price are expected to test 4595 which is
the previous bottom.

One
can expect a bounce if sustains above 4595.Support - 4555 / 4595 /
4635 Resistance - 4660 / 4700 / 4740.

Mcx
Tips Today :- Buy Around 62300 for target of 62600 ?? with stop
loss of 62190 Sideways trend... More updates-- Free Gold Tips