Futures Magazine April 01, 2009
Cover Story
Dollar recovery: Real or illusionary?
With the U.S. dollar index trading in the low 70s through much of 2008, the Bush administration’s so called ‘strong dollar’ policy had become a running joke. But the weak U.S. dollar served an
Breaking News
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Trading the WTI/Brent spread
One of the most widely traded and followed spreads in the oil complex is the WTI/Brent spread. West Texas Intermediate (WTI) crude oil is the U.S.-based benchmark for 40% to 50% of the world’s crude
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Bad fill or bad rule?
Oct. 10, 2008 was an extremely volatile day in equity markets. Glenn Pafumi, however, was enjoying a vacation in Australia. Unfortunately he had not kept an eye on the numerous options positions in
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Tax proposal backlash
When the House of Representatives introduced H.R. 1068, they ignited fierce opposition from traders who opposed its proposed tax on securities. The bill, called the “Let Wall Street Pay for Wall
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New sheriff in town
The CFTC is undergoing a changing of the guard with President Obama’s nomination of Gary Gensler to serve as its next chairman. In his nomination hearing before the Senate Agriculture Committee on
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ICE cracks CDS finish line
ICE US Trust, the clearinghouse of The Intercontinental Exchange (ICE), began clearing credit default swaps (CDS) on March 9, following the closing of ICE’s acquisition of The Clearing Corporation
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Market consolidation
Only five of the 10 countries that make up the Association of Southeast Asian Nations (ASEAN) have viable stock exchanges, and exchanges from all five countries in February signed a memorandum of
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No safe (tax) haven
Senator Carl Levin, (D-Mich.) is sponsoring a bill (S. 506, Stop Tax Haven Abuse Act) which, according to Levin, “targets offshore tax abuses that rob the U.S. Treasury of an estimated $100 billion
Software Review
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Portfolio Maestro
PRICE: $500/month or $5,000/year for the TradeStation-only, EasyLanguage-compatible version. $1,000/month or $10,000/year for the full version, which includes strategy construction in C#, Visual
Trading Techniques
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Multi-tasking eurodollar futures
The eurodollar futures market is impressive in its ability to perform several tasks simultaneously. Eurodollar futures quarterly interest rates must create a separate yield curve that matches the
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Profiting from temporary market anomalies
In a rally or break, some stocks will lead their sector and the broad market. Generally, you should long the strongest stocks in a rally and short the weakest in a break. You should ignore followers.
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Trading forex extremes
Not only are the forex majors among today’s most liquid and widely traded markets, but historically they also have been excellent trending markets. Frequently, most trading profits booked by many of
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Exploiting stock market cycles
Al-Khwarizmi was a Persian mathematician, astronomer, astrologer and geographer whose contributions in these areas provided the foundation for later innovations in algebra and trigonometry. He is
Forex Trader
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Tracking risk appetite
The conventional wisdom about trading is that there are two dimensions traders work within to shape their trades: fundamentals and technicals. Fundamental analysis looks at the economic conditions
Futures 101
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Watch out for those fat tails
The world of investments is an odd one. Various studies have shown that a monkey throwing darts can outperform most active equity managers, yet mutual funds are still widely distributed and the work
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FDIC protection
The failure of firms operating over-the-counter cash forex platforms like Refco’s unregulated forex unit as opposed to its futures brokerage revealed a huge problem in the OTC forex industry:
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Getting started in forex
U.S. regulatory agencies have noted for years that an inordinate number of their fraud cases have been centered around over-the-counter forex markets. Those agencies finally dropped the hammer on
Editor's Note
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fX-rated
Last fall, on the day that Lehman Brothers fell, I was on a flight to Florida for a CME Group financial conference. The plane was filled with industry people and everyone was abuzz about Lehman’s
Book Reviews
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The Heretics of Finance: Conversations with the Leading Practitioners of Technical Analysis
“The Heretics of Finance” is a compilation of interviews with technical trading experts done in a question-and-answer format reminiscent of Jack Schwager’s “Market Wizards.” Each individual is
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Day Trade Online
There’s been plenty of debate over whether you can legitimately and consistently profit as a day-trader. Many argue day-trading is gambling and nothing more, often citing the many day-traders who
Market Analysis
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Shrinking E-minis
Richard Roscelli, broker at Alaron Las Vegas, says the downward movement is “based on people giving up the ghost in regards to the financial institutions. There’s been spot picking in certain
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Natural gas blues
No commodity has fallen quite as precipitously as natural gas — with the possible exception of crude oil — since the bull commodity market imploded in July 2007. And crude oil has at least come off
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Soybeans on the run
Soybeans have been making a pretty consistent retreat ever since the commodity bull market came to a crashing halt last summer. A worldwide recession will do that, and Allendale Vice President Joe
Managed Money
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New regs are inevitable
The overall message from the Managed Funds Association (MFA) to its members at its February Network 2009 Conference in Key Biscayne, Fla. was “Get over it, it’s coming.” The “it” is regulation, and
New For Traders
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New for Traders
CME Group signed an agreement with the JSE Ltd to license CME Group's benchmark corn futures settlement prices to create a new JSE cash-settled corn futures contract. CME group also announced the
Current Analysis
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Financial crisis drives gold, currency link
Two decades ago, the world was quite different. The U.S. dollar was the uncontested standard of value. The euro did not exist. If small traders wanted exposure to currencies, they traded currency
Industry Trends
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Traders view of the world: Is there a bright side?
Alex Lamb, senior vice president in charge of development and marketing at RTS, says he’s scrambling to keep up with demand for beefed up connectivity between U.S. brokers and exchanges in Mexico,
Markets
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Tech talk: Stair steps to parity?
In late February, EUR/USD was threatening $1.25 again. It looks eerily like the U.S. stock market at this juncture — not cascading, but grinding lower. With the momentum thoroughly exhausted from the
Profiles in Options
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Fred Ruffy: Balancing risk and reward
Having your total risk set when entering a position is more important than ever, given the volatility of the last year, which is leading people to options. “More and more people are trading options,”
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Eyeing the markets
As opposed to liquid futures markets, there are thousands of individual equity options contracts to trade, be they individual equities, indexes or exchanged trade funds (ETFs). Because of this, it is
Profiles in Forex
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Chelkowski: Listening to the markets
Marek Chelkowski grew up in Poland and went to University there but even though he came of age in a communist system, he always knew that he wanted to trade and speculate on markets. “Somehow I knew
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A yen for USD/JPY
The first quarter of 2009 is coming to an end and as of March 20, 2009, when one looks at three major currencies vis a vis the U.S. dollar, it is clear that the greenback is looking better than at
Options Strategy
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Adding a naked leg
Due to the explosion of volatility, normal position trading strategies using any type of standard risk management have been hard pressed to show positive results and this has been especially evident
People
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Rolet appointed CEO of London Stock Exchange
Xavier Rolet was named chief executive of the London Stock Exchange. Previously he was a senior executive at Lehman Brothers in Europe. “London Stock Exchange Group[’s] strategic position is unique,
Trader Profiles
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Vaca: Beating the markets
For Francisco Vaca, chairman and chief executive officer of Vaca Capital Management LLC (VCM), that opportunity took the form of a cancelled project — the construction of Fermilab’s superconductor.
