Sign inRecent Commentaries tagged (risk-management)
Brief lessons in basic risk management
Firmly breaking out above resistance of their 50-day moving averages and the previous week's "swing highs," the major indices kicked off March with a solid session of gains. After gapping higher on the open, stocks continued higher throughout the morning session, then consolidated in a narrow,...
Getting Punched in the Face
A reader of mine…forwarded me a video he did on ‘risk’: ZaCon09 - Getting Punched in the Face - Nick Arvanitis from ZaCon on Vimeo.
Risk Management Article from Jason Pearce
Feedback in: As a long-time professional in the futures industry, I was greatly impressed by both of your books and the wealth of information on your site. Job well done! I have recommended your materials to our clients. In August of 2008, we published a white paper to send to our clients. At...
The 5 Components of Trading Well
I’m having a good read of Van Tharp’s latest book: Super Trader: Make Consistent Profits in Good and Bad Markets. It’s quite a good read and captures some key trading principles including what he sees as the five components to trading well: 1. The trading process. The things you need to do daily...
Meet the Greeks – Part 2
(as published in Active Trader magazine) In the last article we started looking at the concept of change and how it affects an option’s fair value. Specifically we used discussed the delta and the gamma – concepts used to quantify the behaviour of an option given a change in the underlying...
Meet the Greeks – Part 1
(Originally published in Active Trader magazine) What a boring game all this would be if option prices showed no fluctuations! The price, or premium, of an option is constantly changing for whatever reason. As an options trader you must be prepared, armed with the knowledge of how an option...
A Quant Approach to Money and Risk Management
Here is an article that looks at the concept of contract allocation and active portfolio management from the point of view of a high frequency trading desk (prop desk). It’s a subject that is taking on greater significance among hedge funds and alternative asset managers. There are two main...
Larry Hite on Risk
Some wise views from Larry Hite: We don’t really trade silver…we don’t trade the S&P…we trade the differences. We really are risk managers. We take on risks, try to exploit them and we leave when they turn against us. That is what we get paid for. Basically we are in the risk transfer business....
More of the Same
Good Morning Traders, Just as the 10 day forecast is bleak for snow here in Park City, it looks like another week of options expiration will go out WITHOUT A BANG. I am still pricing in a slight chance of a severe market correction in a short time. The reasons: Since March (9 months) we have...
More of the Same
Good Morning Traders, Just as the 10 day forecast is bleak for snow here in Park City, it looks like another week of options expiration will go out WITHOUT A BANG. I am still pricing in a slight chance of a severe market correction in a short time. The reasons: Since March (9 months) we have...
Howard Lederer: On Poker and Trading
This is a longer 8 minute plus interview excerpt that I have never posted before. How many great lines does Howard Lederer throw out? ShareThis
Will You Know When to Leave?
There are lots of reasons to be bullish on the stock market these days, not the least of which is the +12.3% spike higher in the S&P 500 over the past 15 trading days. In short, there is nothing quite like big blasts to convince people to hop on the bandwagon as more and more investors seem to...
