If you are going to trade options, it is best to look at the Option Price per contract (ie. He suggests that a forecast within the framework of a money management system would permit the pyramiding trades early in the morning based on the assumption that we know” what the economic report numbers will be. He goes on to suggest that this would more or less emulate the way a large brokerage or investment house would do it. Hong Kong is the epitome of Adam Smith’s economic vision for a capitalist society.
News Arbitrage – Summer 2006 – thousands of people, faster entry, special brokers, and software began to scalp the market immediately after a report. Mr. Yeomans might be somewhat responsible for this as he has been successfully training people to trade the news for some time. The idea is to still base the trade on the economic numbers and results, but to increase the lot size of the trade while forfeiting the early gains of the move. By placing larger bets he hopes to get the same payoff as before news trading became so popular. This blog will publish research on how, when, why, and which news moves what financial markets.
Tom has adapted to market conditions and continues to do so. Next I’ll discuss Tom’s view of the future of FX news trading and how I think it can be realized. This is an early warning that I will be giving a presentation on the impact of news on financial markets to the Toronto Association for Business and Economics (TABE). In the last post I suggested that for those looking at economic announcements return correlations using data from announcement days are the most useful.
I understand what you’re saying…but if I anticipated losing $50,000 dollars in a deal, and only lost 20,000…I’d consider it BETTER news than if I had lost $50,000. I’m not saying it’s great news that I lost anything at all, but it could have been $30,000 worse…I’m not sure if that’s what’s going on here, though. Those who are engaged in a profession which is an economic activity are called as professionals.
If you watch the Dow regularly (and bear in mind other vital data’s effects), it always rises on news of unemployment and drops with news of worker gains, like increased minimum wage. That is the way it used to be done in America, the last 40s, the 50s, the 60s and part of the 70s… our best economic time. Today I noticed the DOW was dropping a bit all morning and then within half an hour of this news making front page yahoo, it started to rise. It is as major an economic force as the railroad was, and after that, the automobile.