Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Art of Investing -- Ignore unavailable to you. Want to Upgrade?

To: Daniel Chisholm who wrote (94)	9/11/1998 11:43:00 AM
From: Sun Tzu	Respond to of 10694

Greatpost Daniel! I loved it and it was not too long at all (IMO). I learn something new every day and today's credit goes to you. I am always amazed of how efficient markets are (in liquid securities that is). You are right about putting up more margin than necessary. I read a report a while ago about futures investing. It concluded that about 80% of the newbie futures accounts go bust within a year. It pointed out however that the accounts that went bust were typically less than $20,000 and used margins to the limit. Where as the ones that survived were larger than $50,000 and tended to put up 3x margin than necessary. Do you do any futures trading yourself? Sun Tzu

To: Daniel Chisholm who wrote (94)	9/11/1998 11:14:00 PM
From: Cymeed	Read Replies (1) \| Respond to of 10694

Daniel, great post re Yen future trading. I have one question. Since you seem to be very familiar with future tradings, what is your take of current market down turn to the "big boys" who hold a lot of future contracts ? A lot of people might have already busted in the future's trading, thus why the rumor today that Lehman went bankrupt. Do you see further contract closing down, margin call, or belly up by those future tradders in the horizon that might affect stock price ? I know for a fact that all the index and big caps are actually controlled by future trading, like Dow, SP500, and Nasdaq 100. The stock price is not controlled by stock traders. But future price is closely related to stock price because of these buy-sell programs based on the premiums between stock and future price. Big banks and security houses are the managers of those contracts, who make money by collecting fees and margin interest from the traders. But those banks and security houses make big loans to the traders too. If the future people decide to further close their long accounts and potentially turn short, what would be the impact to the market in the near future ? Since they use much more margin than stock traders, this is making the bubble really inflated and the market much more venerable. Your opinion ?