Online Trading Blog

Agency brokers are usually large brokerage firms acting as agents to their clients. They perform trading from their clients behalf. The main clients of agency brokers are institutional traders and hedge funds who route large numbers of traders to the agency brokers. Thus they are the middle men between the stock, or any other financial instrument, exchange and the clients.

Agency brokers are believed to perform trades according to the best interest of their clients. They fill the orders from the institutional traders at lowest possible prices and perform faster trade executions for them. Agency brokers also provide a number of other services such as white labeled (or private labeled) trading platforms, trading account management tools, various technical analysis tools and occasional rewards to their clients to improve and popularize their trading services.

Agency brokers charge for their services usually in per trade basis. The fee per trade varies with broker to broker and most agency brokers allow institutional traders and hedge funds to negotiate with them for cheap rates. One major thing to look upon when selecting a agency broker is the hidden charges, if any.

Check out NobleTrading’s Institutional Trading Service today.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Interest rate futures contracts are financial futures contracts, which are based on interest rate changes. The underlying instrument is an interest bearing instrument such as treasury notes and bills, bonds etc. Interest rate futures contribute a different and popularly traded part of futures market with the trading of around 6,000 billion US dollar valued futures per year.

The value of the interest rate futures is depends on the increase or decrease in the interest rate of the underlying instrument. If the interest rate increases the value increases; and if the interest rate decreases the value decreases. Interest rate futures include both short-term profiting products and long-term profiting products.

The short-term products include

• Fed funds futures : based on change in fed funds rate.
• Eurodollars (US Dollar deposits outside US) futures.
• Euroyen (Japanese Yen deposits outside Japan) futures.
• LIBOR (London Inter Bank Offered Rate) futures : based on reference rate for Eurodollar deals between banks.
• Treasury Bill Futures : based on 13 week US Treasury bills.

The long term interest rate futures include :

• Treasury Note Futures : based on 2, 5, 10 years treasury notes from US government.
• Treasury Bond Futures : based on 30 year bonds from US treasury.
• Euro Bund Futures : based a variety of short, medium and long-term futures issued by Germany and Switzerland.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Covered call or buy-write or over-write is perhaps the most popular and traditional options trading strategy which includes limited profit and limited risk nature. Covered calls are practiced when the trader writes options for already bought underlying instruments. The covered call options which are generated using freshly bought underlying instruments is termed buy-writes and those generated using long held underlyings is termed overwrites.

Covered calls are usually practiced when investors expect limited volatility in the underlying instrument prices they hold. Thus they try to make more profit from the stocks by writing call options for a strike price, usually above the current trading price. At the expiration date if the underlying product price is around or below the strike price the option expires worthless and the trader can profit from the initial options premium. If the underlying stock price increases above the option strike price, and the option is exercised, the trader can still make the profit which is a sum of initial premium and the difference between the strike price and underlying purchased price.

The loss occurs when the underlying stock price falls considerably. In this case the call option when expire unexercised by the trader then face a loss which is equal to the difference between the dropped price and the initial option premium. The main advantages of covered calls include the limited risk and the earning of dividends during option period.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

The Week Ahead: Hedge fund problems linked to a weak sub-prime mortgage market and higher oil prices both contributed to recent markets jitters while yields on bonds rose further. The Federal Reserve meetings begin on Wednesday with an important interest rate decision due on Thursday. Significant reports for this week include Monday's existing home sales, Tuesday's new home sales, Thursday's final 1st quarter GDP release and jobless claims numbers, and Friday's May construction spending numbers.

Stocks to Watch: Shares of both Accenture Ltd. (AC N) and Seagate Technology (STX) were added to the Russell 3000 Index and sport bullish near term patterns. Jabil Circuit (JBL) beat the estimated earnings per share as it broke away from a bottoming area and through its 50 day moving average. The Senate passed an energy bill mandating more ethanol production. Stocks in this group that received a lift include: Vera Sun Energy (VSE). Pacific Ethanol (PEIX), Aventine Renewable Energy (AVR), and US BioEnergy Corp. (USBE).

Special Note: The Dow Jones Industrials and other major indexes continue to push in the late stages of a five year rally. Over the past year the succession of highs in the market have been accompanied by a weakening economy. Such divergences have a limited amount of time to run before the fundamentals catch up to stocks prices via more and more earnings misses and disappointments. Stay diversified among as many sectors as possible and lock profits in when appropriate to allow cash for new opportunities.

Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.

To view all of NobleTrading's historical newsletters, click here.
Click here to open an account.

NobleTrading Direct Access Trading

---

email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com

Today real-time forex market indicators are the keys for profiting form online currency trading. They help forex traders in technical analysis to calculate right enter and exit time. Forex market indicators can be either installed with the forex trading systems or can be reached online. There a variety of fore market indicators followed by traders, the best results can be obtained by using more than one indicator to trading a currency pair.

• Moving Average Convergence/Divergence or MACD – it is one of the most followed forex market indicators which is used for find and confirm forex market trends. The difference between to moving averages can be used to calculate crossovers to generate buying and selling signals, overbought or oversold indicators, divergence or trend reversal signals. Stochastic
• Oscillator – it is a powerful forex momentum indicator used to compare present currency exchange rate with historical price. Useful for calculating overbought (above 80) and oversold (below 20) conditions.
• Relative Strength Index or RSI – It is one of the most popular forex market indicators used to figure out the strength of the currency pairs. It works by comparing current price to past price. Used to calculate overbought (above 70), oversold (below 30) and divergence conditions.
• Bollinger Bands – it uses simple or exponential moving averages to calculate volatility and relative price levels, and to generate forex trading signals.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Online trading is now more popular and well invited among traders trading all types of financial instruments. It really helped traders to execute their trades quickly with more market information and less mental tension. But if you are a novice trader or a person wants to trade online you must consider many things before going online.

• First of all you must be ready for trading, must have done some home works on types of trading, different products available, different types brokers, difference between online and traditional trades, etc.
• You must find a good online trading broker who offers solutions as your needs. If you are a fresher to the market choose one broker who offers you help when you want.
• You must be sure about your goals. If you want to trade vocationally and don’t want to make trading as your major profession, keep away from online trading.
• You must have done some demo trading using paper trading account(s) offered by a quality broker(s).
• You must have a high speed internet access and a problem free computer.
• You must arrange some backup for power failures, system failures and connection failures.
• On starting of trading be sure to track and write down all your transactions and at the end of the day make sure that your strategy is right.
• Be careful about additional charges that some online brokers charge.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Ratio spread options trading is one another multi-leg options trading strategy in which the trader usually writes more number of options than he buys for same underlying stock at different strike prices. Radio spread options trading is a limited profit unlimited risk strategy. This type of strategy is used when minimum volatility is expected in market.

In ratio spread options trading, the maximum profit is attained when the underlying stock is traded on the strike price at the options expiration time. The loss increases with the increase of decrease in price from the strike price. There are mainly two types of ratio spread options as Call Ratio Spread Options and Put Ratio Spread Options.

In Call ratio spread options, the trader buys call options at a lower striker price and sells more number of call options at higher strike price. If the on expiration the price is on or around or below the strike price the trader get profited, if price goes beyond the short options prices then the trader will suffer loss due to more number of short options. Put ratio spread options are similar to call options but are constructed using put options. They are traded with minimum debit or with credit. With put ratio spreads the loss is increased when price falls considerable and there is no uptrend loss. There is also backspread or reverse ratio spread strategies which are implemented when volatility is expected in stock prices.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

The Week Ahead: Although the inflation numbers were up in May, the market continues to view the figures as positive as the core numbers remain tame. Despite this, odds still favor an interest rate increase to occur first. A light economic calendar this week may hold the markets steady. On Tuesday, the May housing starts are released along with weekly retail sales. With oil pushing toward $70 a barrel, the oil and gasoline inventories on Wednesday could be important. Then Friday brings the jobless claims and leading economic indicators for May.

Stocks to Watch: Monsanto (MON) boosted its earnings target for 07' as its stock continues its long term up trend. NYMEX Holdings (NMX) broke to a new high on speculation that the company is in merger talks with the New York Stock Exchange (NYX) or the Chicago Mercantile Exchange (CME). Media General "A" (MEG) issued an earnings warning but the stock may already be near a major low. Gaming stocks could be on the move after Penn National Gaming (PENN) was just acquired. Finally, Nvidia Corp. (NVDA) received a strong buy from a major brokerage.

Special Note: The sell signal that was triggered the week of June 4th should not be ignored as the divergences among the DOW indexes continue and the technical backdrop remains tentative at best. The major indexes appear to be in the final vestiges of the rally that started in mid March. Very near term, look for the markets to continue to oscillate to new highs then sell off quickly as a battle between the bulls and bears at these lofty levels wages on. Continue to develop a well balanced portfolio of long and short positions.

Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.
To view all of NobleTrading's historical newsletters, click here.

Click here to open an account.

NobleTrading Direct Access Trading

---

email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com

Day trading is regarded as the riskiest trading practice for all types of financial instruments including forex currencies. By virtue of the bulkiness of trades conducted forex traders are surely most vulnerable for risks, and it is estimated that above 70% of forex day traders lose their money. But the practice of day trading is increasing its popularity and more traders are now willing to take these risks. So what are the causes that attract currency traders to day trading?

Advantages of Forex Day Trading

• Chance to make swift profit – by virtue of the volume and number of trades conducted forex day traders can make more profit than any other sort of traders.
• Less stress – the zero overnight feature of forex day trading is attractive to many traders. In forex day trading every day is a new beginning with no burden on your shoulders.
• Increased leverage – forex day traders get much more leverage, usually 4 times greater, than other sort of traders having overnight risks. The increased leverage can certainly multiply the profit making chance.
• Chance of profiting irrelevant to market trends – the short-selling ability involved in forex day trading help traders to profit in virtually any market condition.
• Advanced trading platforms – forex day traders, buy virtue of their trading needs, use most advanced trading platforms having advanced charting and market research tools with level 2 market access.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Basket trading is the trading of many numbers of stocks, usually more than 10, with a single order entry. Basket trading is performed by sophisticated traders, usually institutional traders, who trade in large quantities. Apart from stocks, basket trading can be also performed for currencies, futures and other similar financial instruments. The trading systems of some firms, like NobleTrading, allow trades to even trade different products (stocks, options and futures) in a single basket.

Advantages of basket trading are

• Ability to trade in individual stocks or basket.
• Time savings.
• Arrangement of stocks in different criteria according to price, industry/sector, growth rate, market capitalization, profit goals etc.
• Automatic generation of criteria.
• Easy monitoring of the performance of a chosen number of stocks.
• Control over your trading portfolio.
• Ability to modify the basket at any time.
• Easiness in generating reports for a given basket.
• Ability to trade market listed and over-the-counter stocks.

Basket trading is considered as a standard practice and advanced trading systems of online brokers include this feature. Although usually there is no additional fee charged for basket trading, the trader has to fulfill some minimum account requirements of starting basket trading. Some what similar procedure to the basket trading is the batch order entry.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

The Week Ahead: A new period of volatility has crept back into the markets this past week as witnessed by the Volatility Index (VIX) and the major indexes gyrating down then up. Economic reports that may contribute to this volatility are the May trade deficit release on Tuesday, May retail sales and import prices on Wednesday along with April business inventories. Thursday brings the jobless claims numbers, and the May PPI. Finally, the week ends with 3 reports: May CPI, capacity utilization, and industrial production.

Stocks to Watch: Shares of Tyco International Ltd. (TYC) lifted on news that its Board approved the spin-off of Covidien Ltd. and Tyco Electronics. Fork lift maker, Cascade Corp. (CAE) reported strong earnings growth and sales rose 15% in their 1st quarter as the stock rose to new highs. Administaff Inc. (ASF) boosted its stock buy back plan by 1 million shares to 10.5 million as the stock broke through its 50 week moving average on the upside. A downgrade to Nike (NKE) by a major brokerage do to industry pressures in the U.S. hurt its shares.

Special Note: As the markets open for trading this week, the DOW Industrials are now 51 months into an up-trend without so much as a 10% correction. This is the first time in its 111 year history that such a feat has been established. Past durations near this magnitude have produced severe corrections much greater than 10% and as high as 50% in the DOW. With the Dow Utilities now leading the way to the downside and DSI (daily sentiment index) of traders perched near 90% historic highs, caution should be used and a diversified portfolio of longs and shorts developed.

Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.

To view all of NobleTrading's historical newsletters, click here.
Click here to open an account.
NobleTrading Direct Access Trading

---

email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com

Asset allocation is a strategy used by investors to balance their profit and risk by diversifying their portfolio investments. The main objective of asset allocation is the surety in earning in all changing environments. The main classes available in an asset allocation model include stocks, bonds, cash, real estate, forex currency, precious metals etc. Asset allocation is now considered as a large step in the financial planning of an individual.

The practice of asset allocation depends on the need, financial background, risk tolerance ability, investment horizon etc. Each person needs a different asset allocation model. There are mainly 4 different asset allocation models as

1. Preservation of Capital Model –This asset allocation model is for those want to preserve their money for near future. The major part of their portfolios includes treasury notes and commercial papers.


2. Income Model - This asset allocation model is for those demand steady income for a considerable period of time, especially those on retirements. Includes investing in real-estate, treasury notes, shares of companies with prolonged dividend payments, insurance policies etc.


3. Growth Model - This asset allocation model is for those want to maximize their capital in a short-time. Includes mainly investing in stocks and similar instruments. They mainly follow growth investing strategies and prefer mid cap and small cap stocks.


4. Balanced Model - This asset allocation model is for those what growth and income. Includes investments in fixed income instruments, real-estate, stocks of all sizes (large, mid and small cap in a managed way) etc.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service,Day Trading Brokerage

Butterfly spread options trading strategy is one of the multi legged options trading strategies in which a trader deals with options for four different trades at same expiration date for same underlying product. It is one of the complex options trading strategies in which the trader profit when the price of underlying product remains around the original price. Butterfly spread options strategy is a blending of bull and bear spread in one contract.

Butterfly spread options include lone and short call and put options. All butterfly options are limited profit limited risk strategies. In long call options there are three legs with 4 possible trades, two long calls for low and high strike prices and two short calls for middle strike prices. The maximum profit is the intrinsic value of lower strike call at the time of expiration deducted by initial debt and commissions.

In long put butterfly spreads puts are employed in place of calls. Short butterfly spread strategies are employed when volatility is expected in underlying product price. They include writing of one lower and higher sticking calls/puts and buying two at-the-money calls/puts. The commissions for butterfly options may be some what high as there is 4 trades involved in a single strategy.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Energy futures contracts are futures contracts which have energy products as underlying commodity. Energy commodities are one of the most traded commodity futures types. Trading energy futures usually requires more money and account size; there are also mini contracts available for almost all types of energy commodities.

Crude oil futures have crude oil as underlying commodity. They are the most widely traded energy futures. The major exchanges trading crude oil futures are NYMEX, TOCOM and ICE. In NYMEX standard contract size is 1,000 US barrels and mini contract size is 500 US barrels. Natural gas futures are the second most widely traded energy futures offered mainly NYMEX. The standard contract size is 10,000 mmBtu (million British thermal units) and mini contract size is 5,000 mmBtu.

Other major energy futures include unleaded gasoline futures and propane futures - both having same contract size as crude oil, kerosene futures, Diesel futures etc. Electricity futures which have electricity generated through virtually all methods are also available for trading. The players of energy futures market includes oil and gas producers, refineries, pipeline shippers, product wholesalers, product retailers, product end users, freight shippers and speculators.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

For most penny stock traders, finding good tradable penny stocks is a more complex process than trading them. As penny stocks seriously lack valuable company information, most traders blindly pick their stocks to trade, or follows advice received from any where and eventually lose their money. Below are some tips to find profitable stocks.

• Make a list of penny stock companies first, of which the industry is fairly known to you.
• Now eliminate those companies which you think, or realize, have no sound management or financial background.
• Now read remaining companies using various technical indicators, and delete those that do not fall into your trading nature.
• Try to know more about those companies by investigating online, through friends and fellow traders or through company management.
• Use various stock screeners to screen your watch list.
• Properly record every bit of information you receive about those stock and company on your watch list. (AOL, Yahoo!, Prodigy, MSN and financial newspapers have good information resources)
• Regularly modify your watch list according to latest news, penny stock lists available through various sites, broker provided watch list etc.
• If you are looking for short-term profits then look for penny stocks which are quiet regularly traded or those that are popular for that time.

You can also find quite a bit of penny stock pickers and watch lists on various sites. But beware of frauds.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

The Week Ahead: Employment numbers came in on the high end of the expected range in May but will require multiple high monthly readings to engage the fed in raising rates. Education, healthcare, and leisure industries led the way, but manufacturing was down. April factory orders come out on Monday, while 1st quarter productivity and costs are due on Wednesday. Also watch the oil and gasoline inventory numbers. Thursday brings the jobless claims and April wholesale trade figures, and Friday the April international trade numbers.

Stocks to Watch: J. Crew Group (JCG) moved up out of a long consolidation area on strong volume after beating estimates in their 1st quarter. Brinker International (EAT) the big restaurant chain boosted its stock buyback by $300 million and the stock rebounded off a recent low. Esterline Technologies (ESL) had strong 2nd quarter numbers as its stock surged on Friday. Finally, Hovnanian Enterprises (HOV) revenues dropped 29% and earnings fell to .49 loss versus a 1.60 profit as the housing slump gains traction.

Special Note: The Dow Utilities Index has recently rolled over significantly and often acts as a barometer for the direction of the Dow Industrials and Dow Transportation averages. With the Dow Jones approaching the 14,000 barrier combined with record margin debt, extreme caution should be used for stock purchases. Also, with the huge bubble taking hold in the Shanghai Index in China, inevitably a spill over here in the US markets from a major sell-off will impact stock prices sharply as they did in February. Hedge stock positions where possible.

Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.

To view all of NobleTrading's historical newsletters, click here.
Click here to open an account.

NobleTrading Direct Access Trading

---

email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com

While more and more peoples are getting in the forex market, it is becoming increasingly large with more trading volume and liquidity. The mini forex market is also growing at a fair pace. We today will look upon the advantages of trading mini forex contracts.

• Reduced amount needed for opening a trading account. The minimum account is around $300.
• Leverage equaling standard forex accounts.
• Free advanced trading systems like standard accounts. Can experience advanced charting and analyzing tools at lower costs.
• Good to practicing trading; good for novice traders and traders having experience of trading stocks and futures.
• Currency pairs as like standard accounts.
• Trading with lesser amounts reduces trading risks, the pip is usually around $1 for mini forex traders.
• Always a good step for traders who have just closed a paper trading account.
• Good for implementing stop-loss order and other similar loss minimizing methods.
• Helps traders in designing a good forex trading strategy based on their situations.

Mini accounts need more attention, at present situation where 95% of novice traders lose their money.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Growth investing strategy is one of the most followed stock investing strategies. It is contradict to value investing strategy. In growth investing the traders invest in growth stocks – stocks of companies have above-average growth rate in a particular field. Today the stocks showing considerable growth in price for a period of time is also grouped in growth stocks.

The traders who follow growth investing strategy usually does not bother about the price of the stocks. They only trust in the growing potential of the companies, which they derive using various qualitative analytical methods like the company management, suitability to new technological inventions, ability to produce future earnings, growth of the industry, popularity in public, etc. Growth investors follow many methods to find suitable growth stocks, they include emerging markets, blue chips, recovery shares, smaller companies, internet and technology, second-hand life policies, special situations etc.

Growth investors mainly use earnings growth and PEG factor (by dividing projected P/E ratio with projected growth rate) to find suitable growth stocks. Growth investing strategy is extremely fruitful if the whole market stays up for a considerable period of time. The stock price is pushed up by both the company growth and the market growth. But the strategy can also taste bitter when market stay low for considerable time or if the calculations about the company prove incorrect.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage

Strangles trading is one of the popular multi-legged options trading strategies practiced by option traders to profit from the movements of underlying product price in either direction. Like straddle trading strategy, strangles are also performed when the trader is sure about the price movement but unsure about the direction of movement. The main difference between straddle and strangle is that strangle trading involves purchasing out-of-the-money call and put options.

Strangle options trading strategy is performed for call and put options for same underlying product, stocks or commodity, with same expiration date but with different strike prices. The trader exercises the put option when the price of the underlying instrument falls considerably from the range and exercises call option when price rises considerably from the range. But if the price remains within the range, both options expire without exercise and the trader loss the option premium he paid.

Long strangles strategy is practiced when greater movement of price is expected and short strangles is when lesser short-term movements are expected. The main advantage of strangle is less expensive than straddle as options are out-of-the-money. It offers an unlimited profit making chance with limited risk, the option premium. Traders can also reduce their loss by selling unprofitable option once they are realize the market will not move as they thought.

NobleTrading.com Features Online Stock Trading, Online Options Trading Online Futures Trading, Online Forex Trading Worldwide Brokerage Service, Day Trading Brokerage