The use of derivatives in hedge funds has always been an appealing yet controversial topic of discussion ever since the collapse of LTCM was blamed on the extensive use of leverage (among other factors). And because of this reason, we felt that it would be worthy to consider hedge funds as part of the...
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There has been much talk recently about China revaluing its currency — lots of different talk. Many market observers believe that the Chinese government will appreciate its currency by roughly 5 to 10 percent in order to curb inflation, cheapen imports like copper, and slow other capital inflows. Some see this revaluation happening as...
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Dale Wheatley is an exceptional, passionate and creative in his approach to using the MACD indicator for directional stock analysis of the chart patterns. It is the most creative and insightful approach to teaching the student how to interpret the relationship between the price and the MACD indicator. It takes focused attention and committed...
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As if we need more confusion to the already-perplexing lexicon of the options world, we must also contend with LEAPS. The acronym, which stands for Long Term Equity Anticipation Security, is essentially just a long-winded way of referring to long-term options that are one to two years out. Not all optionable underlyings have LEAPS,...
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The world has many ways to measure risk, but if the recent financial crisis has taught us anything, it is that asset price is the great equalizer in the fixed income markets. When global markets began to crash over a year ago, traditional measures of risk in credit markets became completely decoupled from asset...
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Sometimes when making lemonade there’s just not anymore juice that can be squeezed out of a lemon. In investing, there’s a similar idea with shorting a stock, sometimes the investors shorting the stocks have piled on so much, there’s no way for the stock to go down anymore. In general, short sellers of a...
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