The trading world is a big place with lots going on all the time. Since the trading world is but one subset of the larger world, one can make the easy leap that to understand the context of the trading world one must keep up with the daily machinations of the world in general. The two examples below are from news sources I track daily. The first points to a macro economic element of the global economy and the second points to a microelement of the trading world.
China passed the United States last year as the biggest auto market on the strength of sales tax cuts, subsidies to rural buyers and incentives to encourage drivers to switch to cleaner vehicles … In a report this week, the Nielsen Co. said its annual “China auto trend” survey found buying sentiment has fallen sharply as the effect of Beijing’s economic stimulus spending fades and housing costs rise. The share of people surveyed who plan to buy in the next 12 months dropped by 21 percentage points from a year earlier to 32 percent.
The above information is obviously important in developing in trading/investing strategies. As China goes so goes the global economy, at least this is the case these days. Although the above contains some specific and important information, the unwritten important point is that economic stimulus is being withdrawn on a global scale. This is a big deal that will affect markets as governments go through the process of removing stimulus.
The SEC is reviewing the high-speed marketplace that has become increasingly fragmented and complicated over the last decade. The SEC in September proposed to ban the orders, which some exchanges “flashed” for a fraction of a second to specific market participants before displaying them to the wider marketplace, giving exchanges a last chance to fill the orders in-house …
The above has nothing to do with the big, economic picture, but it does point to an important element of the trading world that affects all of us, individual traders trying to make a go of it. I don’t know about you, but I am certain I have suffered from the high-speed trading that has become a larger and larger part of the trading world.
The world is a complicated place, and all that goes on in it impacts the global markets. One needs to be as informed as possible about the world, both the large and small “news,” in order to develop the best trading/investing strategies. To me, being informed means tracking a wide variety of sources about a wide variety of subjects. I don’t know about you, but I have always placed a high premium on knowledge, especially in a world (trading) where one piece of news can shift the balance up or down in a flash (pun intended). In a world this fickle, having an edge is the key to success, and, in my book, understanding both the macro and micro elements of the world is one sure way to build that edge. So, read, listen, watch, and stay as sharp as you can, or the market will roll right over you.
Trade in the day; invest in your life …
