NASDAQ OMX

Download a copy here.

The report looks at the current financial climate and the potential of cloud computing.

It’s a challenging time for members of the financial markets community – a credit crisis, new regulations under Dodd-Frank, new global Basel III capital adequacy requirements, high transaction costs and more have all added to their operational complexity. “Firms need to find ways to get more out of every capital expenditure and investment in technology. Simply put, they need to do more with less… One potential answer to this dilemma is to adopt a cloud computing architecture into the enterprise.”

With this suggestion, the report goes on to look at:

• How cloud architecture enables business agility & reduces costs
• Understanding cloud environments
• public cloud
• private cloud or privately-hosted clouds
• community cloud
• hybrid cloud
• Busting the two biggest cloud myths: “too new” and “not secure enough”
• A case study of NASDAQ OMX’s FinQloud

Want to know more about the above and how cloud technology can help your business? Download the report now!

NASDAQ OMX is a Gold Sponsor of the upcoming Trading Show Chicago.

TRADERS´ Mag

Check out the most recent issue here.

Key articles in this issue include:

• What traders need to learn from the Cyprus crisis
• On the great Shiller P/E controversy
• Avoid common traps in the markets
• How to combine Fibonacci with reversal patterns
• The gap-reversal strategy
• How to create a successful trading strategy

Read this month’s issue here.

TRADERS’ Mag is a media partner of the upcoming Trading Show Chicago.

Since I began trading six years ago, I’ve heard lots of so called experts recite plenty of advice.  Most of the time the advice offered was nothing more than a typical cliché.  After a while, I got to the point that most of the advice I was given was all but useless. I was always looking for someone to offer me that one thing that I was missing that would make me a millionaire overnight.  What I didn’t  realize was that I had what I needed to be successful all along, I just didn’t realize it yet… well until now.

My trading strategy has changed over the years to where it is today.  Recently, I’ve been able to mold my trading edge in such a way that it conforms to my risk tolerance and yet offers plenty of good returns.  As I tried to figure out what I was doing that was different from my previous failures, I discovered something very profound.  And as I examined the qualities of my strategy, I found that I had become a Cliché Trader. Let me explain.

I bet if I asked you to write down all the clichés you’ve heard over your trading career, the list would be very long.  I have found that some just don’t fit my style while others simply don’t make sense. Whenever I hear “Buy the rumor, Sell the fact,” I say HUH???  By the time I hear a rumor, the opportunity is long gone. Moreover, since I’m a technical trader, rumors are irrelevant to me. So there are some clichés that don’t work for me. However, I have found there are some clichés that I believe everyone should apply to their trading. The list includes the following:

• The Market is always right
• The Trend is your friend until it bends 
• Buy the dips and sell the tips
• Buy low and sell high.
• Support becomes resistance and resistance becomes support.

Here are some of my own made up clichés (I’m not sure if they are clichés or not, but they are relevant nonetheless):

• Never trade with money you can’t afford to lose.
• Never try to be smarter than the market.
• Never fish the bottom or top of the market.
• Never trade countertrend.

Let’s talk about how these clichés and principals apply to my trading edge. First off, I am absolutely convinced that market is always right. It can’t be wrong. The market is where it’s at during any given moment because two people with opposing views agreed to a price and initiated a trade. This process continues perpetually and the price reflects the market sentiment as time goes by. Therefore the market is always right. It’s our job as traders to get the same mindset as the majority of traders that make up any given market so that we can put on a position that is favorable to the current market sentiment.  his brings me to cliché number two; the trend is your friend until it bends.  If the market is moving up for most of the morning, why would you want to short it? This makes no sense to me unless you feel charitable and wish to give away some of your money to others in the marketplace. Remember, the market is always right. So until the market tells you it’s going the other way, why would you assume you know more than the market?  

I guess while I’m talking about this, I can add three of my four personal clichés to the discussion (Never try to be smarter than the market; never fish the bottom or top of the market; and never trade countertrend.)  If the market is always right, why would I want to trade against the trend?  By doing so, I have decided I am smarter than the market (which is always right!)  How can you be smarter than something that is always right?  The answer is YOU CAN’T! The same concept applies to fishing for bottoms or tops of the market.  To think you know the exact point a market is going to stop climbing or falling is making the assumption you know more than the market does.  Sorry, but that simply isn’t true. Whether you are looking at a lagging indicator (MA’s, MACD, stochastics, bolinger bands, etc) that all try to suggest that your symbol is overbought or oversold or simply analyzing changing volumes; I have found that all these indicators are not very effective at predicting when change is coming.  In my opinion, only price action can tell you that.  I’ve seen and heard of more traders getting blown out by violating these principles than anything else.

So if I say you shouldn’t fish for bottoms or tops, then why do I like the cliché “Buy the dips and sell the tips?”  After all, the bottom of the market is a dip right?  Wrong. The bottom of the market is the simply the bottom.  So then what is a dip or tip?  Well, in a rising market, a dip is a pullback from a previous high. Taking a look at a falling market, a tip is a pullback from a previous low.  This brings me to my next cliché; buy low and sell high.  If I am looking to put on a long position, wouldn’t it make sense to get a value entry?  Of course it would.  So I tell people, I look to buy on sale, or sell at value. I look for a suitable pullback then enter.  Whether I’m right or wrong, I’m in a much better place and will hit my profit easier or minimize my loss. In either case, I’m better off.  

The real question then is… where is the right place to buy or sell?  This brings me to the next cliché; Support becomes resistance and resistance becomes support.  That tells me everything I need to know.  If you look at any symbol, you can often see that a previous top has now become a bottom while a previous bottom has become a top.  Don’t believe me; look at your own charts. I have my charts set up in a way that gives me clear spots to test.  And I have found that most of these spots are high probability entry points.  In the event they are wrong, I find out right away and can cut my losses down to a minimum.  

Finally, there’s one last cliché I think is vital to any trader; never trade with money you can’t afford to lose.  Why is this so important?  Well, after trading for six years now, I have come to understand that 90% of trading is the ability to manage your emotions.  If this is true, then how do you think you will handle the market conditions when you are constantly in fear of losing your money?  I wish someone would have explained this to me when I first started trading. I would have better prepared myself so that I had an edge.  Instead, I traded when I wasn’t prepared and struggled for years because of this. Imagine if you had a nice steady income and your bills were all covered.  If you had an account that had no bearing on your current finances, how do you think you would perform? Now imagine that your only income is from trading and you have limited resources other than what is currently in your trading account. Do you honestly feel you would perform the same as in the previous example?  Not even close.  I strongly encourage you to review your personal financial situation. If it’s not where it should be, you may want secure another income source to relieve you of the emotional burden when trading.

So, in closing, I suggest that you take some time to analyze your trading signal.  If you find you’re violating any of these principles you may want to rethink your signal. Ask yourself… Am I a cliché trader?  If not, you may want to become one soon.  

Good Luck.

TopstepTrader is a media partner of the upcoming Trading Show Chicago.

Karim Taleb

Download the whitepaper here.

“The effects of the Federal Reserve’s on-going policy of artificial money creation are well documented by now… Given that price levels reflect a relative abundance or scarcity of a certain supply against a certain demand, an increase in the supply of money against a fixed amount of shares in the equity indexes naturally increases the price of the index, and with all other variables remaining equal. Clearly, the bulk of the upwards variation is a direct result of the debasement of money, and even more so that the economic picture has not improved to most, except for the direct beneficiaries of the scheme.”

The whitepaper goes on to looks at:

• S&P 500 performance during Fed Open Market Committee action
• Effect of FOMC meetings on the S&P 500
• Risk effect of FOMC meetings

Get your copy of the whitepaper now.

Karim will be speaking at the upcoming Trading Show Chicago in June, on the topic, ‘Are mid-sized rogue algos really the bad guys? Fairness in HFT and the markets.’ He will also be participating in a panel session on ‘The future of the capital markets industry – lessons learned and how to move forward.’

But this year, the Dow is flexing some springtime muscles, and one of the most prized bits of handed-down wisdom that traders live by is being hotly debated.

“Sell in May and go away” has long been a mainstay of the trader’s phrasebook. Traditionally, investors have pulled out of the market before the summer months and then bought back their stock in November. Data bears this out; according to Ned Davis Research, the average performance for the period from May 1 through October 31 each year since 1950 was 1.2%. The average performance for the period from November 1 through April 30 each year since 1950 was 7.0%.

This year, however, some voices are being raised in contention. S&P Capital IQ chief equity strategist Samuel Stovall says when stocks start the year off strongly, as they have this year, the May-to-October period sees a gain.

Among the best performing sectors so far in May are industrials, consumer discretionary, energy, and tech, all sectors that do better in a global growth environment. And indeed, stocks have also been stoked by central bank activities around the globe. The Bank of Japan has a major asset buying program, while the European Central Bank cut rates last week and the Reserve Bank of Australia cut rates Tuesday.

“”We’ve had a bull market type advance since mid-November, but we’ve been in this since March of 2009. I don’t think it’s tattered,” said Stovall. “I think maybe a lot of investors are gaining religion…the thing is they do it sporadically, meaning they don’t do it all at once.

“Bull markets take the stairs,” Stovall finished, “but bear markets take the elevator.”

Portions of this article were originally posted here.

Adam Johnson looks at bonds on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

Barclays high yield is at it’s lowest. Not only are we looking at low absolute but also low relative yields.

After 26 years and 13 premier league titles, Alex Ferguson has announced his retirement as manager of Manchester United. The most successful club manager in English football history is now set to become a director on the board of Manchester United FC.

In a statement on the ManU site, Sir Alex said, “The decision to retire is one that I have thought a great deal about and one that I have not taken lightly. It is the right time.”

The announcement was kept from the public, despite speculation, until today. Due to the club’s flotation on the New York Stock Exchange, any uncertainty about the figure would have to be addressed immediately to appease investors and stave off a potential fall in valuation.

So what’s next for Manchester United? What will happen to the stock value? He will obviously still play a big part in the club and any fluctuations may arise around the announcement of the new manager. Click here to see the current overview of MANU on NYSE.

Sir Alex will end his reign as manager and coach next Sunday, May 19.

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In this article, I would like to talk about: How to continue learning to trade without damaging emotional and financial capital.

The Trading world is highly competitive, severely punishing, ruthlessly unforgiving and yet can be very rewarding. While travelling the roller coaster journey of trading, the trader will likely experience a lot of frustration, anger, fear, greed, euphoria, heartbreak, and financial and emotional meltdowns. There are traps and mine fields all around and the unsuspecting trader is unaware of all these even after getting hurt repeatedly.

The only way to become a successful trader is through a lot of experience, many screen hours, and patience. It takes a while to figure out the markets and then some more to apply the learning to actually profit from trading. The trader finally and reluctantly realizes the need to become a serious student of the ‘Game of Trading’. By this time however, most traders are emotionally frustrated and financially stressed and the road to success may begin to look very dark. So what is the solution? How does a trader know if he has the skills before putting capital at risk again?

Before talking about the solution, let us see what the trader needs in order to be successful and profitable. The main steps for success in trading can be briefly summarized as:

1. Finding the Edge

2. Developing a proper risk and money management strategy

3. Implementing a firm, yet practical and adaptable, disciplined trading routine.

To put all this together and to put it in practice, the trader needs to have a self-developed Trading Plan detailing the edge, risk and money management strategy, and a list of do’s and don’ts to complete the discipline routine. Successful traders will have to learn to predefine the risk of every trade, cut losing trades quickly, and systematically take profits or trail profits when the trade goes in his/her favor. The trader will need to develop abilities to trade without fear, while at the same time exercise restraint so that he/she does not become reckless. With sufficient experience, the trader will learn to feel the markets, adapt his action to the continuously changing market behavior, and learn to preserve capital. That experience is an indispensable part of what allows one to stay in the game longer and become a consistent, profitable trader.

While the above solution is straight forward, the question remains, how does the trader get the necessary experience? How does the trader get back in shape? Remember, the trader is most likely emotionally and financially wounded. The answer is, ‘simulated trading under supervision’. The key is ‘under supervision’. The only way to learn and master trading is by experience. Trading needs to be treated as a continuous exercise in learning, and while simulated trading is certainly no substitute for live trading, gathering experience without using real capital can and will save you lots of money that you may have otherwise lost while just trying to get experience. I am convinced that a trader will have a much better chance at succeeding if he can start making money and keep it while sim trading under proper supervision. If sim trading is done under the supervision and monitoring of a responsible agency and if there is a reward attached to the performance, I believe it will closely approximate the challenge and stress of live trading. This is especially true if such sim trading also costs some real or earned money.

It takes a long time to find your edge. It is akin to the skills of an athlete or a professional sports man. Experts and market wizards will confirm that there are a million ways to make money in the market but for the individual trader it might take years to find ‘the one edge’ from which the trader can personally start profiting. Even after finding the edge, it takes a while to be able to execute the trades flawlessly with discipline and to begin profiting from it.

The trader can use the sim to learn how to manage risk by following required criteria set up for performance evaluation and learn to overcome personal limitations and weaknesses before he/she starts to trade again with real money. It truly will help to test your discipline. The trader learns to protect capital, which he/she will learn to appreciate as the learning progresses.

I am currently benefitting from simulated trading under supervision. My firm of choice is TopstepTrader. It is the only firm I know that has taken the bold step to promote simulated trading and not to exploit traders’ vulnerability. Additionally, it makes available excellent guidance and resources in the form of expert market commentary, trader chat rooms, psychological development, and continuing education. Not only do they encourage traders to use sim trading as a valuable tool to expedite the learning curve but they also are willing to back any promising trader who achieves a set of performance requirements and profit objective. Of course, the evaluation, called the ‘Combine’, comes with a small cost. The cost is a blessing relative to what one would spend trying to trade their hard earned money without properly understanding what they are doing. The cost also ensures that the trader is emotionally invested in the efforts and performance. Moreover, the trader is conscious at all times that his performance is recorded, observed and evaluated for a potential live trading account. This is a win win for current traders and aspiring traders alike. Not only is the trader learning without the associated costs and possible losses, he/she is ACTUALLY vying for a job as Live Trader.

I firmly believe, simulated trading under supervision, can be a solution and possible cure for the wounded trader. The trader can and will get the required experience without putting much money at stake and will be able to experiment and find out for themself if he/she can become a profitable trader and if they can consistently make money in the market. In fact, I believe it can help all traders to learn and improve if done under the supervision and monitoring of an independent agency.

Good Luck to all Traders.

TopstepTrader is a media partner of the upcoming Trading Show Chicago.

Forbes lists are like gold. They give us a little insight into what the biggest and best are earning in the financial world. The billionaires on this list made their profits by making big trades in financial markets and charging investors the highest fees. Here’s a snippet of Forbes richest billionaire hedge fund managers and traders. Enjoy!

10. Paul Tudor Jones II

Net worth: $3.6 billion. The founder of the Tudor Investment Corporation, Paul Tudor Jones made his first fortune trading cotton on Wall Street before launching the corporation. He anticipated the 1987 market crash enabling him to triple his capital.

9. Kenneth Griffin

Net worth: $4.1 billion. Kenneth Griffin is the founder of Citadel and began investing as a Harvard undergrad. By the time he graduated, he had $1 million before being introduced to hedge fund manager Frank C. Meyer who seeded the future billionaire when he launched Citadel in 1990.

8. Bruce Kovner

Net worth: $4.3 billion. Kovner founded Caxton Associates in 1983, generating more than $12 billion in net gains for investors. Before this, Kovner dropped out of Harvard, drove taxis, wrote and studied at Julliard where he is now Chairman.

7. David Tepper

Net worth: $7 billion. Tepper’s firm, Appaloosa Management, generated around 30% net on average annualised returns since 1993. Most hedge funds underperformed in 2012, but Tepper did not posting around 30% net returns.

6. Steven A. Cohen

Net worth: $9.3 billion. Despite accusations of insider trading, ex-wife problems and having to sell the penthouse, Steven A. Cohen is still making huge money in financial markets. SAC Capital Advisors posted gross returns in 25% range in 2012.

5. John Paulson

Net worth: $11.2 billion. Paulson pulled off “the greatest trade ever” 6 years ago, betting against subprime mortgage securities. Despite Paulson Advantage ending down more than 14%, the fund returned nearly 20% net of fees last year.

4. James Simons

Net worth: $11.7 billion. Simons began his career as a theoretical mathematician and was a codebreaker during the Vietnam for the U.S. D.O.D. The founder of Renaissance Technologies retired in 2010 but still profits from the firms funds.

3. Ray Dalio

Net worth: $12.5 billion. “King” of the hedge fund industry, Dalio founded Bridgewater Associates from his Manhattan apartment in 1975. With big plans for growth including a new $750 million headquarters for more than 2,000 employees, no. 3 on our list shows no signs of slowing down.

2. George Soros

Net worth: $19.2 billion. Chairman of Soros Fund Management which manages not only the money belonging to his foundations but his personal fortune, Soros still remains involved in the $24 billion firm.

1. Carl Icahn

Net worth: $20 billion. Top of the list is Carl Icahn who has been trading markets for decades, peaking in recent months reaching $20 billion. Thanks to bets on Hain Celestial Group and CVR Energy, Icahn returned 28% to himself and his employees last year. Possibly the best employer in the world?!

What do you think? To see the full list on Forbes site, click here.

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Thanks to the free-trade agreement established in 2011, Canada and Colombia have been conducting trade on a small-scale basis. Concha is one of a number of Colombians who have expressed interested in expanding this relationship, as well as those interactions related to tourism and foreign investment.

In the past, the strong presence of drug cartels somewhat discouraged the willingness of other countries to get involved with Colombia, but enough progress has been made that this is no longer considered by most to be a significant factor. Over the last two decades, the number of visitors to the country’s major cities has increased by millions.

Although Concha agreed that the country still experiences some perception problems from other countries, he remarks “…If the country wasn’t improving the way it is, these things wouldn’t be happening.”

Some Canadians, however, seem to be doubtful or outright pessimistic regarding the relationship with Colombia, citing decreased demand for the traditional Colombian goods coal, coffee, and sugar as well as a concern for human rights.

Part of the free-trade agreement between the two countries is that Colombia must make a yearly report on the progress of human rights.

Read the original article here

Interested in Canadian trade? Check out Quant Invest Canada, taking place this October in Toronto.