November 7, 2008

Trading in Volatile Markets

Category: Webinars – Paul Nowak – 11:00 am

New Webinar Series for Investors & Traders
Register Now!

The volatility markets have seen in 2008 has been unprecedented. The fear, panic and volatility of October made headlines daily. Markets have since calmed down a little, allowing investors and traders to catch their breath.

But questions still remain. Will the market volatility seen in October return? Can equity and commodity markets rebound? What strategies can investors and traders utilize to protect themselves? 

Join our Lind Plus Senior Market Strategists this month for a series of webinars on Trading in Volatile Markets. The webinar series aims to help investors and traders protect their positions, diversify their investments and maximize their returns. Specific focus will be placed on options trading, the CBOE’s Volatility Index (VIX), and the gold futures market.

Trading in Volatile Markets – Webinar Schedule

Date

Topic

Speaker

Tuesday, November 11

VIX – The Fear Index

Matt Krupski

Tuesday, November 18

Trading and Investing in Gold

Phil Streible

Tuesday, November 25

Options Trading for Volatile Markets

Michael Sabo

*You can register for the above webinars by visiting Events Calendar on our Web site.

The VIX, popularly known as the “Fear Index,” gained a lot of attention after surging to a 52-week high of 89.53 on October 24. The VIX, which measures the buying and selling of S&P 500 put and call options, can be traded as a futures contract or used as an indicator of market uncertainty.

“The movements in the S&P 500 affect option prices, the VIX index and VIX futures,” said Matt Krupski, a Lind Plus Senior Market Strategist, who is also presenting the November 11 webinar on the VIX. “Understanding these relationships is key to making educated trades in VIX futures and S&P options.”

With the stock market trading near levels last seen in 2003, many investors are wondering whether a bottom has been reached or if more pain will follow. Legendary investor Warren Buffet famously stated, “Be fearful when others are greedy, and be greedy when others are fearful.”

“That time to be greedy, might just be now,” said Michael Sabo, a Senior Market Strategist with Lind Plus. “But knowing what strategies to use can be the difference between making a lot of money, or losing a lot of money.”

Traditionally, investors have looked to gold in uncertain times as a safe-haven to protect and diversify their investments. “Gold is the currency of kings,” said Senior Market Strategist Phil Streible, who plans to present the November 18 webinar on gold investment and trading strategies. “It’s important that investors know the various options available to them, and the strategies they can use.”

The markets have given investors plenty of reasons to be both optimistic and pessimistic. Historically, bear markets in the last 60 years have occurred once every five years. The average bear market decline during that time has been about 25 percent with the last bear market ending in 2002. From the beginning of 2008 to the end of October, the S&P 500 is down about 34 percent, making the current bear market an overachiever.

By historical standards, optimists can argue that we are near a bottom. However, there are still plenty of pessimists arguing that the stock market will continue to decline. Weak consumer spending (and confidence) could negatively impact corporate earnings in the months ahead. A weak housing sector, unemployment and slower growth will also continue to weigh in on the markets. Yet it remains to be seen whether markets have already factored in all the bad news.

Paul Nowak is Events Manager at Lind-Waldock. He can be reached at 312-788-2855 or via email at pnowak@lind-waldock.com.

Past performance is not necessarily indicative of future trading results. Trading advice is based on information taken from trade and statistical services and other sources which Lind-Waldock believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder.

Futures trading involves substantial risk of loss and may not be suitable for all investors. © 2008 MF Global Ltd. All Rights Reserved. Futures Brokers, Commodity Brokers and Online Futures Trading. 141 West Jackson Boulevard, Suite 1400-A, Chicago, IL 60604.

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