Futures Magazine March 01, 2009
Cover Story
Top traders of 2008
You have to go back to 1990 when the Barclay CTA index had a higher return, 21.02%, than the 14.11% in 2008. The index produced several 20% plus years in the 1980s, but the entire industry was much
Software Review
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Interactive Brokers' Risk Navigator
The Interactive Brokers Risk Navigator examines portfolio risk using tables, charts and what-if strategies. It allows you to study the portfolio as a whole, group the positions by sectors or
Forex Trader
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The expectation gap
The current global synchronized bust caught policymakers around the world by surprise because global conditions regarding risk exposure of underlying assets were opaque. According to the Bloomberg
Editor's Note
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Bailout paradox
A funny thing happened while the government was bailing out Wall Street. Yes, some of those firms had the audacity of dope to pass around big bonuses, and yes there was anger at them by the
Book Reviews
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Panic: The Story of Modern Financial Insanity
Michael Lewis is a terrific writer and “Liar’s Poker” is still worth reading 20 years after publication. His tales of idiosyncratic traders and their bizarre behavior are believable and well
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I.O.U.S.A.: One Nation. Under Stress. In Debt.
“I. O. U. S. A.” is most famously a 2008 cautionary movie á la Al Gore’s “An Inconvenient Truth.” As with “Truth,” I. O. U. S. A. has broadened its scope to become a multi-media crusade. The title
Breaking News
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Consolidation hits FX
Prompted by aggressive new capitalization requirements and the threat of greater regulatory oversight, consolidation in the forex market continues, most recently with FXCM’s acquisition of the U.S.
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KRX nationalized
KRX was privatized in 1988; however, the Korean government is now claiming the exchange is a de facto public institution because it derives more than 50% of its revenue from a monopolistic business,
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No specs in CDS market
Industry insiders who hoped that Congress’ attacks on speculators in 2008 would slow down in 2009 were likely disappointed about the introduction of The Derivatives Markets Transparency
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Block exchange launch
The platform is designed to maximize access to liquidity and improve execution quality of the U.S. equity block trading market by allowing non-displayed liquidity to anonymously access displayed and
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International news
The chairman of the U.K.’s Financial Services Authority is calling for banks to hold higher levels of capital against potential losses in response to the current financial crisis. Adair Turner, FSA
Market Analysis
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Bonds correct
While Treasuries have pulled back from their all-time highs of 141-28, they are still trading at elevated levels. “People suddenly realized that the lights still come on and 93% of us are still
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Euro underachiever
After recovering more than half of its losses in December from the bear move off of its all-time high, the euro is declining again, dropping from 147.19 on Dec. 19 to 127.02 on Feb. 2. “After that
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Gold bugging
Since New Years, gold prices have increased more than $100 per ounce, trading to $915 in early February. Tom Hartmann, broker analyst for Altavest Worldwide Trading Inc., says there has been a
Managed Money
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Are more hedge fund regs on the way?
Blumberg provided five possible scenarios for regulatory changes. One would be the creation of a super regulator, which would encompass all of the current financial regulators based on the Treasury
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Managing crude volatility with ETFs
Since hitting record highs last summer, the price of crude oil remained volatile as many consumers cut back on their spending, causing demand to drop rapidly and inventories to increase. There are
People
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Doman named CEO of Russell Investments
Andrew S. Doman was named chief executive officer at Russell Investments. Previously, he was a founding director of McKinsey & Company Inc.’s UK-based European asset management practice. “Russell is
Trader Profiles
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Dreiss: Surf’s up for profits
In a year that produced explosive returns for old line long- term trend followers, it is only right that we profile one of the method’s founding fathers. Edward (Bill) Dreiss got a job at a San
Profiles in Options
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Interview with Invesco PowerShares’ Ed McRedmond
Invesco PowerShares Capital Management is a registered investment advisory firm headquartered in Wheaton, Ill., and is the advisor and sponsor of PowerShares ETFs. Many of the company’s products are
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ETFs: Coming of age
If 2007 was the year that exchange-traded funds (ETFs) demonstrated they were major players in the financial arena, then 2008 was the year they came of age. Amid a persistent slide in equities,
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Pardo: Anticipating trends
That is what Bob Pardo attributes his 142.02% returns in 2008 to. Pardo has operated his Kenilworth, Ill.-based CTA since 1999 and although it has featured some impressive years, including a return
Trading Techniques
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Download Paul Cretien's option pricing models
Downloads for “Building a better strangle,” March 2009These spreadsheets include the models referenced in the March 2009 Trading Techniques story by Paul Cretien. They should also be used in place of
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Building a better strangle
One option spread strategy that requires a trader to estimate relevant high and low strike prices between the trade date and expiration is the short option strangle. As defined by James Cordier and
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Technical analysis in event-driven markets
Event-driven markets are a common deterrent to many would-be technical analysts. After all, how can lines on a chart make sense of a market that appears to change direction on news events? A common
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Hybrid trading techniques
Day-trading stock index futures is challenging and rewarding. There is a great sense of accomplishment in dueling successfully with the sharp knife that is the electronic futures market. Electronic
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Doomsday hedging
For the past six months, the currency market has not been kind to its traders. In the euro market, we were accustomed to having about 80 pips of noise on the four-hour chart before a trend developed,
Futures 101
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Know your broker
Your broker can be the most important person in your trading life, so you shouldn’t enter into a relationship with one lightly. You have to know who you’re dealing with and make sure they know and
Industry Trends
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Inside the numbers
Options on Kospi 200 stock index futures launched in 1997, long before the CME started trading E-mini S&P 500 contracts. Initially dismissed for their small size, the contracts have been praised as
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Kospi leads Korean expansion
Citing reckless management and a clause in the nation’s constitution, South Korea’s finance ministry has effectively nationalized the Korea Stock Exchange by categorizing it as a public institution.
Markets
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Tech talk: Confirmation in 3s
The first thing to look at is the trend. Combining an eight-period exponential moving average (EMA), Tim Tillson’s T3 formula, first published in the Journal of Combinational Theory, is a good place
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2009 equities outlook: Taking stock
As Americans headed into the holidays, the National Bureau of Economic Research threw a wet blank on the season by acknowledging in early December that the United States was in a recession and had
New For Traders
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New for Traders
CME Group launched four new Chicago petroleum contracts on CME ClearPort. CME Group also will expand its international incentive programs, including a simplified fee structure, to provide greater
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
Profiles in Forex
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On the art of a trade
Before Jason Alan Jankovsky became a forex trader, he traded Chicago Big Board corn, calling his orders in to his broker. But his trading didn’t really take off until he began to understand the
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Working in multiple time frames
Finding quality trading opportunities can be a challenge even for the most seasoned trader, but you can improve your system’s inherent probabilities when you work with multiple time frames. Many
