S&P Online Review Links

Performance, Instruments Traded & Structure

1)  S&P Performance 2007 – 2018
2) S&P Futures What They Are and Where They Trade
2) Defining Trend, Trade Duration & Number of Contracts Traded
3) Defining Risk On Every Trade and Duration of Every Trading Period
4) Automated Trading Accounts (ATA), What They Are and How They Work
5) Fee Structure
6) Defining Overall Risk For Your Account Before the First Trade Goes On
7) How Balances Are Guaranteed Plus or Minus Trading Activity
8) How To Open An Account

Historical data

9) 1985-2018 chart (using monthly data)
10) All Bull & Bear Markets 1983 to 2018

Current Data used for generating orders

11) 7 year chart (monthly data)
12) 2 year chart (weekly data)
13) 6 month chart (daily data)
14) Last month (120 minute bars)
15) Last 15 days (60 minute bars)
16) Last 5 days (15 minute bars)
17)  Opinion (overall average of 12 indicators)
18) Current relative strength & volatility
19) Current support and resistance
20) Implied volatility

Current quotes

21) Futures quotes
22) Options quotes
23) Contract specifications
24) Current margin requirement

Comparing this program’s performance to today’s top stocks & ETF’s

26)  Top 100 Exchange Traded Funds (ETFs)
27)  Top 100 performing U.S. stocks
28)  A Cost Comparison – Futures versus ETFs

Stocks in the S&P 500

28) Quotes, charts and analysis for all 500 stocks
29) SEC filings & information for all 500 stocks

Other Indices we trade using this structure

30) U.S. Stock Index futures we trade
31) European Stock Index futures we trade  
32) Economic & Research Reports

If you have questions or comments send us a message or  schedule an online review

Regards,
Peter Knight Advisor

—————————————————————-

Disclosure

 

 

Reality Check

  • 1985-2018 Bull, Bear Markets and recovery periods.
  • Identifying the trend and trading with it long or short.
  • Defining risk on every trade and for the duration of every trading period.
  • Trading S&P futures with daily liquidity 8x the value of all S&P 500 ETFs combined, including SPY, IVV and VOO.

Let’s put economic fundamental justification aside, doesn’t this market still look just a little overbought to you?

At major tops or bottoms volatility has always gotten especially nasty and unpredictable, guys like me love it but for the average investor it can seem more costly than a divorce and 5 kids in private school.

Reality, the 2009 through 2017 Bull market was one of these easiest of all time to trade, we only had 4 out of 100 months where monthly price action was completely below the Exponential Moving Average 9.

Looking at the chart below how hard was it to identify the long term trend? I think you’d find a 9 year old’s video game more challenging.

Recent price action however, should be a wake up call

To motivate all traders to prepare for a more challenging market scenario like March 2000 to March 2013.

To trade with the trend long or short using strategy that defines risk on every trade and for the duration of every trading period.

I’ve been a professional trader for over 30 years, the percentage changes I’m  seeing in price action and the media rhetoric trying to justify is like watching the 5th remake of an old movie, same basic plot, same drama and same ending, a bear market.

To make my point I’ll bet you can’t match the percentage price action on the 5 charts below to the period that price action occurred.

Bull market 1

Appreciated 105.05%
Bear market that followed, down 57.59%.

5 years and 6 months from the start of the bear market until we saw a net new high, name the period or see 6 for the correct answer.

1) January 1985 – October 1987  –  Bear to recovery
2) December 1987-July 1990Correction to recovery
3) October 1990 – March 2000 – Bear to recovery
4) March 2003-October 2007 – Bear to recovery
5) March 2009-January 2018 Analyst 1 ,  Analyst 2
6) Correct answer for bull 1  – Bear to recovery

Bull market 2

Market appreciated 106.94%
Bear market that followed, down 35.93%.

1 year and 8 months until we saw a net new high, name the period or see 6 for the answer.

1) January 1985 – October 1987  –  Bear to recovery
2) December 1987-July 1990Correction to recovery
3) October 1990 – March 2000 – Bear to recovery
4) March 2003-October 2007 – Bear to recovery
5) March 2009-January 2018 Analyst 1 ,  Analyst 2
6) Correct answer for bull 2 –  Bear to recovery

Bull market 3

Market appreciated 70.42%
The correction that followed, down 20.36%.

7 months from the start of the correction until we saw a net new high, name the period or see 6 for the answer.

1) January 1985 – October 1987  –  Bear to recovery
2) December 1987-July 1990Correction to recovery
3) October 1990 – March 2000 – Bear to recovery
4) March 2003-October 2007 – Bear to recovery
5) March 2009-January 2018 Analyst 1 ,  Analyst 2
6) Correct answer for bull 3 – Correction to recovery

Bull market 4

Market appreciated 412.46%
Bear market that followed, down 50.50%.

7 years and 4 months until we saw a new high, name the period or see 6 for the answer.

1) January 1985 – October 1987  –  Bear to recovery
2) December 1987-July 1990Correction to recovery
3) October 1990 – March 2000 – Bear to recovery
4) March 2003-October 2007 – Bear to recovery
5) March 2009-January 2018 Analyst 1 ,  Analyst 2
6) Correct answer for bull 4  – Bear to recovery

Bull market 5

Market appreciated 316.28%

Length of  the bear market to recovery unknown,  name the period or see 5 for the correct answer.

1) January 1985 – October 1987  –  Bear to recovery
2) December 1987-July 1990Correction to recovery
3) October 1990 – March 2000 – Bear to recovery
4) March 2003-October 2007 – Bear to recovery
5) Correct answer for bull 5  – Bear to recovery Analyst 1,  Analyst 2 & 3

Same plots, drama, media rhetoric why would anyone assume it’s going to end differently?

From my trading desk I can see no rational reason why the current bull market will be be pardoned by the bear, far less of a reason not to short this market when the long term up trend reverses to down and capture the move lower like 1987, 2000-2002 and 2007-2009.

1987

2000 and 2007

2007-2009

1927 to 2018 tells the same story

Inflation adjusted prices give a clearer picture

This link will give you the 1927-2016 historical data for actual and inflation  adjusted prices, no registration required (excel file).

One simple way to define the trend and trade risk

In the examples below I’m using the S&P futures contract.

Daily volume for this contract exceeds 130 billion USD, the contract trades 23.75 hours a day (Sunday -Friday) and has a very liquid underlying options market with squeaky tight bid/ask spreads.

If you’re not familiar with futures contracts they are agreements to buy or sell at an agreed price on or before an agreed date.

Long = own the contract anticipating the price to move higher, once a long position is established it has to be sold on or before the contract delivery date, for example an ESH18  contract has to be offset or before March 16th 2018.

Short = Owe the contract, selling a contract you do not own, once a short position is established it has to be bought back on or before the delivery date, Trading futures there is no dividend delivery, no short squeezes.

Contract information

ESH18
ES = Chicago Mercantile Exchange S&P contract
H = Delivery month (H = March)
18 = Year

Contract value = $50 X the index, (an index at 2,825.00 = $141,250.00)
Bid/ask spread 0.25 = $12.50 , contract value = $141,250.00 at 2,825.00
Margin requirement = $5,050.00 (1/28th of contract value)
Margin call, if your balance falls below the margin requirement
Carry cost built into forward pricing  (current leverage cost 0.73% annually)
Trade cost, $26.60 or less per contract (includes all fees)
Contract volume, 130+ billion USD daily, liquid underlying options market
US Taxation, 1256 rule 60% long-term, 40% short-term on all trades regardless of trade duration, 2 minutes or 2 years.

One click lets you go long or short a contract that mirrors the S&P index (worth $141,250.00 at 2,825.00) with as little as $5,050 in your account.

Long short flexibility, a 23.75 hour trading day and 130+ billion USD in daily liquidity make it very easy on days like 2nd and the 5th of February 2018 to hedge an existing portfolio or capture the move lower.

1) Defining the Trend

1 of the 12 indicators I use to define trend is an Exponential Moving Average 9 (EMA9)

Whatever data duration you’re using 1 minute or 1 month if price action is below the Exponential Moving Average 9 (EMA9) you’re in down trend, above the EMA9 a up trend.

1.1) How to define a long term trend

Using this link  see if you can identify today’s long-term trend using monthly price action. (above EMA9 = up, below = down)

Example, on the chart below monthly price action is above the exponential moving average 9 (red line) telling us this market is in a long-term up trend.

1.2) Medium term trend

Using this link  identify today’s medium term trend using weekly price action.

Example, on the chart below weekly price action is above the exponential moving average 9 (red line) telling us this market is in a medium-term up trend but the trend is weakening.

1.3) Short term trend

Using this link  identify today’s short-term trend using daily price action.

Example, on the chart below daily price action went below the exponential moving average 9 (red line) telling us the market’s short-term trend has reversed from up to down.

1.4) Intraday trend

Using this link  identify today’s short-term trend using 30 minute price action.

Example, on the chart below 30 minute price action is below the exponential moving average 9 (red line) telling us the market’s intraday trend is currently down.

1.5) Confirming the EMA9 defined trend using these indicators

In this example since the 2nd of January 2018 the overall average has changed from a 96% buy.

To an 24.00% sell on 2 February 2018.

2) Trading rules

2.1) Long-term trend, is monthly price action, above or below the EMA9  linked here? above = buy, below = sell.

Does the overall average and long-term technical opinion linked here  agree with the EMA9?

If the EMA9, overall average and long-term indicators all agree long term trades of 30 to 90 days in duration are permitted using defined risk strategy.

2.2) Medium-term trend, is weekly price action, above or below the EMA9  linked here above = buy, below = sell.

Does the overall average, and medium-term technical opinion  linked here  agree with the EMA9?

If the EMA9, overall average and medium-term indicators all agree medium-term trades of 11 to 29 days in duration are permitted using defined risk strategy.

2.3) Short-term trend, is daily price action, above or below the EMA9  linked here  above = buy, below = sell.

Does the overall average and short-term technical opinion  linked here  agree with the EMA9?

If the EMA9, overall average and short-term indicators all agree short-term trades of 2 to 10 days in duration are permitted using defined risk strategy.

Defining the trend is only 1 battle that needs to be won in order to win the war of profitability. How you structure your trades and maintain discipline are as, if not more important.

2.4) In today’s trading environment you have to structure your trades so you are immune to volatility for example February 2018

2.5) It is essential to remove all concerns except getting from point A to B without having to worry about excessive volatility risk during periods like C

2.6) How this is accomplished is by “collaring” every trade

  • Collars define risk on the trade and for the duration of the trading period
  • They eliminates any possibility of the position being stopped out.
  • Properly set up a collar is premium neutral ( does not waste money on net purchases of option time premium)

3) Procedure for collared long positions

3.1) In this example I’m using weekly price action for a trade duration between 11 and 29 days. Weekly price action (medium-term trend) is above the  EMA9

The trend is up, = long

3.2) The overall average is a 96% buy confirming the EMA9 defined trend

3.3) The medium-term indicators are 100% buy.

3.4) All agree, medium-term trades are permitted with the trend for a trade duration between 11 to 29 days.

On the 15th of September 2017 we buy 1 S&P futures contract 2,500.00 contract value $125,000.00, margin requirement $5,050.00

Enter a long position 2,500.00

3.5) Using the angle of the trend we set the profit objective at 2,550.00. We’re anticipating the trend will continue and the 2,550.00 profit objective will be achieved on or before the 13th of October 2017.

Set the profit objective at $2,550.00

(Use support and resistance, volatilityimplied volatility and ranges   to make profit objectives more precise)

3.6) Generating option premium by writing a call against the 2,500.00 long at the profit objective of 2,550.00

15 September 2017
We enter a long futures position at 2,500 (contract $125,000.00)
Write a call at 2,550.00 collecting 15.00 points = +$750.00.
Options expiration, 13th of October 2017
Contract value at 2,550.00 = $127,500
The only way our 2,500.00 long can be called away from us is at our profit objective of 2,550.00 generating a gain on the futures position of $2,500.00

3.7) Using the 15.00 points collected = $750.00 from the call write we buy the 2,450.00 put cost 17.00 points = ($850.00).

The put objectively defines risk on the 2,500.00 long position for the duration of the trading period (until 13 October 2017 expiration)

The put also negates any possibility of being stopped out of the position.

Collected on the 2,550.00 call write = 15.00 points at the profit objective
Paid out on the 2,450.00 put -17.00 points, objectively defines risk

Net cost of the hedge 2.00 points = $100.00,  which defines the risk on a position worth $125,000 from 14 September 2015 until 13 October 2017. 

There are 3 potential outcomes for this trade, market stays the same, goes against us our in our favor

3.8) Outccome 1, The market stays the same and settles on the 13th of October 2017 at 2,500.00

The call we wrote at 2,550 expires worthless, +15.00 points = $750.00

The 2,500.00 long futures settles unchanged at 2,500.00 = $0.00

The 2,450 put purchased expires worthless, -17.00 points = $850.00

Total bid/ask spreads, commission, exchange & regulatory fees =-$159.78

All in net profit or loss = -$259.78

3.9) Outcome 2, the market moves hard and fast against us

The market drops from our entry price of 2,500.00 (contract value = $125,00.00) down 600.00 points -24.00% to 1,900.00 contract value $95,000 in “fast market action”.

During a “fast market” it is difficult if not impossible to liquidate a position (when you’re on the wrong side).

When the market moves far enough trading is suspended and the market is “locked limit” (for today’s price limits see this link)

If a percentage drop like this occurs it would have no impact on the maximum risk of a collared position because we own the put.

The put objectively defines risk on the 2,500.000 long for the duration of the trading period.

The maximum risk (in this example) is the distance between our entry at 2,500.00 contract value $125,000.00 to where the put engages at 2,450.00 contract value $122,250.00 = $2,500.00 regardless if this market moved to zero.

Loss on the 2,500.00 long futures position (600.00) points = -$30,000.00

The call we wrote at 2,550.00 expires worthless +15.00 points =+$750.00

The put we owned at 2,450.00 is profitable 533.00 points =+$26,650.00

Total bid/ask spreads, commission, exchange & regulatory fees =-$159.78

All in net loss = -$2,759.78 on a market drop of  24.00% in fast market action.

A $100.00 hedge prevented a potential loss on this position of up to $30,000.

The market moves higher

3.10) The established trend continues to grind higher and the contract moves from our entry on the 15th September 2017 at 2,500.00, contract value $125,000 to our profit objective of 2,550.00 contract value $127,500 on or before the 13th of October 2017.

Gain on the 2,500.00 long futures position 50.00 points = +$2,500.00

The call we wrote at 2,550.00 is offset by the futures, we keep the 15.00 points in collected premium =+$750.00

The put we owned at 2,450.00 expires worthless -17.00 points =-$850.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78 (or less)

All in net profit or loss = $2,240.22.

If your trading desks is on their game they can offset or lay down a position at anytime using a “3 way”. An example of a 3 way, buy an S&P futures, collar it plus or minus 50.00 at a net cost of +2.00 or better for 3rd Friday expiration using weekly options.

Translated you’re long a futures contract. You’ve written a call 50.00 points above the futures fill price. Using the collected premium bought a put 50.00 points below the futures fill price. You paid 2.00 points or less net in option time premium (2.00 X $50.00 = $100.00) to a hedge your futures position through the 3rd Friday of the month.

Procedure for short positions

3.11) In this example I’m using  daily price action for a trade duration between 2 and 10 days. During the trading session on the 1st of  February 2018 price action moved below the EMA9 for the 3rd day.

Below the EMA9, trend is down = short

3.12) The overall average  of the 12 indicators was a 24% sell, this confirmed the trend defined by the EMA9.

3.13) The short-term indicators were a 60% sell, agreeing with the EMA9 and overall average of the 12 technical indicators.

3.14) All agreed, short-term trades are permitted with the trend using a trade duration between 2 to 10 days.

3.15) On the 1st February 2018 you sell 1 S&P futures contract (ESH18) for March 2018 delivery at 2,815.00 contract value $140,750.00.

3.16) Using the angle of the trend you set the profit objective at 2,740.00, contract value $137.000.00

Your anticipating the 2,740.00 profit objective will be achieved on or before the 9th of February 2018.

(You can make the profit objective more precise using  support and resistance, volatilityimplied volatility and ranges)

Collaring he 2,815.00 short

  • A “collar” defines risk on the trade and for the duration of the trading period
  • Eliminates any possibility of the position being stopped out.
  • Properly set up a collar is premium neutral ( does not waste money on net purchases of option time premium)

3.17) How to collar a short position

When you enter the 2,815 short futures position contract value = $140,750.00
Write a put against it at the profit objective of 2,740.00
Contract value $137,400.00.
In this example we’re using an expiration on the 9th of February 2018.

When you write (sell) an option you’re collecting option time premium,
On this put write, you’ve collected 27.00 points = +$1,350.00.
The only way the 2,815.00 short can be called away is at a profit
Short 2,815.00 called away at 2,740.00 = +$3,750.00 on the futures position.

3.18) Using the 27.00 points collected from the put write = $1,350.00

Buy the 2,890.00 call, cost 16.00 points = -$800.00
Contract value at 2,890.00 = $144,500.00
The call objectively defines risk on the 2,815.00 short for the duration of the trading period 1 February 2018 through 9 February 2018

The call also negates any possibility of being stopped out of the short position.

The net collected on the collar +9.00 points = +$450.00,

In this example we we’re paid $450.00 to define risk on a position worth $140.750.00 from 1 February 2018 to 9 February 2018.

Potential outcomes for this trade

3.19) The market stays the same and settles on the 9th of February 2018  unchanged from our entry at 2,815.00.

The put wrote at 2,740.00 expires worthless, we keep the 27.00 points = $1,350.00

The 2,815.00 short futures settles unchanged at 2,815.00 = $0.00

The 2,890.00 call purchased expires worthless, we lose 16.00 points = -$800.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78 (or less)

All in net profit or loss  = +$390.22

The market moves hard and fast against us

3.20) We rally from our short entry at 2,815.00 (contract value = $144,500.00) +300.00 points +10.66% to 3,115.00 contract value $155,750 in “fast market action”.

During a “fast market” it is difficult if not impossible to liquidate a position (when you’re on the wrong side). When the market moves far enough trading is suspended and the market is “locked limit” for today’s price limits see this link.

If a  rally like this occurred it would have no impact on the maximum risk on our collared position because we own the call.

The call objectively defines our risk on the trade and for the duration of the trading period. The maximum risk (in this example) is the distance between our entry at 2,815.00 contract value $140,750.00 to where our call engaged at 2,890.00 contract value $144,500.00

Loss on the 2,815.00 short futures position is 300.00 points = -$15,000.00

The put we wrote at 2,7400 expires worthless, +27.00 points =+$1,350.00

The call we own at 2,890.00 is profitable for 209.00 points =+$10,450.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78 (or less)

Net loss = -$3,359.78.78 on rally against us of 10.66% in fast market action.

In this example we were paid $+450.00 to prevent a potential loss of $15,000

Market moves lower

3.21) The short term trend continues lower, the price moves from our entry on the 1st of February 2018 at 2,815.00, contract value $140.750.00 to our profit objective of 2,740.00 contract value $137,000 on or before the 9th of February 2017. (These positions can be offset at anytime)

Gain on the 2,815.00 short futures position 75.00 points = $3,750.00

The put we wrote at 2,740.00 is offset by the short futures position  we keep the +27.00 points in collected time premium = +$1,350.00

The call we purchased at 2,890.00 expires worthless -18.00 points = -$800.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78

All in net gain or loss = $4,140.22

You can set up the same type of trades for any individual stock in the S&P 500 that has underlying options liquidity with reasonable bid/ask spreads, using the tools here on SeekingAlpha

Linked below are all the stocks in the S&P 500, the SeekingAlpha links for fundamental information, quotes & charts, an additional link for company information/history and one for SEC’s filings.

SeekingAlpha Link Company Information & History SEC Filings
A Agilent Technologies SEC
AAP Advance Auto Parts SEC
 AAL American Airlines Group SEC
 AAPL Apple Inc. SEC
 ABBV AbbVie Inc. SEC
 ABC AmerisourceBergen Corp SEC
 ABT Abbott Laboratories SEC
 ACN Accenture plc SEC
 ADBE Adobe Systems Inc SEC
 ADI Analog Devices, Inc. SEC
 ADM Archer-Daniels-Midland Co SEC
 ADP Automatic Data Processing SEC
 ADS Alliance Data Systems SEC
 ADSK Autodesk Inc SEC
 AEE Ameren Corp SEC
 AEP American Electric Power SEC
 AES AES Corp SEC
 AET Aetna Inc SEC
 AFL AFLAC Inc SEC
 AGN Allergan, Plc SEC
 AIG American International Group, Inc. SEC
 AIV Apartment Investment & Management SEC
 AIZ Assurant Inc SEC
 AJG Arthur J. Gallagher & Co. SEC
 AKAM Akamai Technologies Inc SEC
 ALB Albemarle Corp SEC
 ALGN Align Technology SEC
 ALK Alaska Air Group Inc SEC
 ALL Allstate Corp SEC
 ALLE Allegion SEC
 ALXN Alexion Pharmaceuticals SEC
 AMAT Applied Materials Inc SEC
 AMD Advanced Micro Devices Inc SEC
 AME AMETEK Inc SEC
 AMG Affiliated Managers Group Inc SEC
 AMGN Amgen Inc SEC
 AMP Ameriprise Financial SEC
 AMT American Tower Corp A SEC
 AMZN Amazon.com Inc SEC
 ANDV Andeavor SEC
 ANSS ANSYS SEC
 ANTM Anthem Inc. SEC
 AON Aon plc SEC
 AOS A.O. Smith Corp SEC
 APA Apache Corporation SEC
 APC Anadarko Petroleum Corp SEC
 APD Air Products & Chemicals Inc SEC
 APH Amphenol Corp SEC
 APTV Aptiv Plc SEC
 ARE Alexandria Real Estate Equities Inc SEC
 ARNC Arconic Inc SEC
 ATVI Activision Blizzard SEC
 AVB AvalonBay Communities, Inc. SEC
 AVGO Broadcom SEC
 AVY Avery Dennison Corp SEC
 AWK American Water Works Company Inc SEC
 AXP American Express Co SEC
 AYI Acuity Brands Inc SEC
 AZO AutoZone Inc SEC
 BA Boeing Company SEC
 BAC Bank of America Corp SEC
 BAX Baxter International Inc. SEC
 BBT BB&T Corporation SEC
 BBY Best Buy Co. Inc. SEC
 BDX Becton Dickinson SEC
 BEN Franklin Resources SEC
 BF.B Brown-Forman Corp. SEC
 BHF Brighthouse Financial Inc SEC
 BHGE Baker Hughes, a GE Company SEC
 BIIB Biogen Inc. SEC
 BK The Bank of New York Mellon Corp. SEC
 BLK BlackRock SEC
 BLL Ball Corp SEC
 BMY Bristol-Myers Squibb SEC
 BRK.B Berkshire Hathaway SEC
 BSX Boston Scientific SEC
 BWA BorgWarner SEC
 BXP Boston Properties SEC
 C Citigroup Inc. SEC
 CA CA, Inc. SEC
 CAG Conagra Brands SEC
 CAH Cardinal Health Inc. SEC
 CAT Caterpillar Inc. SEC
 CB Chubb Limited SEC
 CBG CBRE Group SEC
 CBOE CBOE Holdings SEC
 CBS CBS Corp. SEC
 CCI Crown Castle International Corp. SEC
 CCL Carnival Corp. SEC
 CDNS Cadence Design Systems SEC
 CELG Celgene Corp. SEC
 CERN Cerner SEC
 CF CF Industries Holdings Inc SEC
 CFG Citizens Financial Group SEC
 CHD Church & Dwight SEC
 CHK Chesapeake Energy SEC
 CHRW C. H. Robinson Worldwide SEC
 CHTR Charter Communications SEC
 CI CIGNA Corp. SEC
 CINF Cincinnati Financial SEC
 CL Colgate-Palmolive SEC
 CLX The Clorox Company SEC
 CMA Comerica Inc. SEC
 CMCSA Comcast Corp. SEC
 CME CME Group Inc. SEC
 CMG Chipotle Mexican Grill SEC
 CMI Cummins Inc. SEC
 CMS CMS Energy SEC
 CNC Centene Corporation SEC
 CNP CenterPoint Energy SEC
 COF Capital One Financial SEC
 COG Cabot Oil & Gas SEC
 COL Rockwell Collins SEC
 COO The Cooper Companies SEC
 COP ConocoPhillips SEC
 COST Costco Wholesale Corp. SEC
 COTY Coty, Inc SEC
 CPB Campbell Soup SEC
 CRM Salesforce.com SEC
 CSCO Cisco Systems SEC
 CSRA CSRA Inc. SEC
 CSX CSX Corp. SEC
 CTAS Cintas Corporation SEC
 CTL CenturyLink Inc SEC
 CTSH Cognizant Technology Solutions SEC
 CTXS Citrix Systems SEC
 CVS CVS Health SEC
 CVX Chevron Corp. SEC
 CXO Concho Resources SEC
 D Dominion Energy SEC
 DAL Delta Air Lines Inc. SEC
 DE Deere & Co. SEC
 DFS Discover Financial Services SEC
 DG Dollar General SEC
 DGX Quest Diagnostics SEC
 DHI D. R. Horton SEC
 DHR Danaher Corp. SEC
 DIS The Walt Disney Company SEC
 DISCA Discovery Communications-A SEC
 DISCK Discovery Communications-C SEC
 DISH Dish Network SEC
 DLR Digital Realty Trust Inc SEC
 DLTR Dollar Tree SEC
 DOV Dover Corp. SEC
 DPS Dr Pepper Snapple Group SEC
 DRE Duke Realty Corp SEC
 DRI Darden Restaurants SEC
 DTE DTE Energy Co. SEC
 DUK Duke Energy SEC
 DVA DaVita Inc. SEC
 DVN Devon Energy Corp. SEC
 DWDP DowDuPont SEC
 DXC DXC Technology SEC
 EA Electronic Arts SEC
 EBAY eBay Inc. SEC
 ECL Ecolab Inc. SEC
 ED Consolidated Edison SEC
 EFX Equifax Inc. SEC
 EIX Edison Int’l SEC
 EL Estee Lauder Cos. SEC
 EMN Eastman Chemical SEC
 EMR Emerson Electric Company SEC
 EOG EOG Resources SEC
 EQIX Equinix SEC
 EQR Equity Residential SEC
 EQT EQT Corporation SEC
 ES Eversource Energy SEC
 ESRX Express Scripts SEC
 ESS Essex Property Trust, Inc. SEC
 ETFC E*Trade SEC
 ETN Eaton Corporation SEC
 ETR Entergy Corp. SEC
 EVHC Envision Healthcare SEC
 EW Edwards Lifesciences SEC
 EXC Exelon Corp. SEC
 EXPD Expeditors International SEC
 EXPE Expedia Inc. SEC
 EXR Extra Space Storage SEC
 F Ford Motor SEC
 FAST Fastenal Co SEC
 FB Facebook, Inc. SEC
 FBHS Fortune Brands Home & Security SEC
 FCX Freeport-McMoRan Inc. SEC
 FDX FedEx Corporation SEC
 FE FirstEnergy Corp SEC
 FFIV F5 Networks SEC
 FIS Fidelity National Information Services SEC
 FISV Fiserv Inc SEC
 FITB Fifth Third Bancorp SEC
 FL Foot Locker Inc SEC
 FLIR FLIR Systems SEC
 FLR Fluor Corp. SEC
 FLS Flowserve Corporation SEC
 FMC FMC Corporation SEC
 FOX Twenty-First Century Fox Class B SEC
 FOXA Twenty-First Century Fox Class A SEC
 FRT Federal Realty Investment Trust SEC
 FTI TechnipFMC SEC
 FTV Fortive Corp SEC
 GD General Dynamics SEC
 GE General Electric SEC
 GGP General Growth Properties Inc. SEC
 GILD Gilead Sciences SEC
 GIS General Mills SEC
 GLW Corning Inc. SEC
 GM General Motors SEC
 GOOG Alphabet Inc Class C SEC
 GOOGL Alphabet Inc Class A SEC
 GPC Genuine Parts SEC
 GPN Global Payments Inc SEC
 GPS Gap Inc. SEC
 GRMN Garmin Ltd. SEC
 GS Goldman Sachs Group SEC
 GT Goodyear Tire & Rubber SEC
 GWW Grainger (W.W.) Inc. SEC
 HAL Halliburton Co. SEC
 HAS Hasbro Inc. SEC
 HBAN Huntington Bancshares SEC
 HBI Hanesbrands Inc SEC
 HCA HCA Holdings SEC
 HCN Welltower Inc. SEC
 HCP HCP Inc. SEC
 HD Home Depot SEC
 HES Hess Corporation SEC
 HIG Hartford Financial Svc.Gp. SEC
 HII Huntington Ingalls Industries SEC
 HLT Hilton Worldwide Holdings Inc SEC
 HOG Harley-Davidson SEC
 HOLX Hologic SEC
 HON Honeywell Int’l Inc. SEC
 HP Helmerich & Payne SEC
 HPE Hewlett Packard Enterprise SEC
 HPQ HP Inc. SEC
 HRB Block H&R SEC
 HRL Hormel Foods Corp. SEC
 HRS Harris Corporation SEC
 HSIC Henry Schein SEC
 HST Host Hotels & Resorts SEC
 HSY The Hershey Company SEC
 HUM Humana Inc. SEC
 IBM International Business Machines SEC
 ICE Intercontinental Exchange SEC
 IDXX IDEXX Laboratories SEC
 IFF Intl Flavors & Fragrances SEC
 ILMN Illumina Inc SEC
 INCY Incyte SEC
 INFO IHS Markit Ltd. SEC
 INTC Intel Corp. SEC
 INTU Intuit Inc. SEC
 IP International Paper SEC
 IPG Interpublic Group SEC
 IQV IQVIA Holdings Inc. SEC
 IR Ingersoll-Rand PLC SEC
 IRM Iron Mountain Incorporated SEC
 ISRG Intuitive Surgical Inc. SEC
 IT Gartner Inc SEC
 ITW Illinois Tool Works SEC
 IVZ Invesco Ltd. SEC
 JBHT J. B. Hunt Transport Services SEC
 JCI Johnson Controls International SEC
 JEC Jacobs Engineering Group SEC
 JNJ Johnson & Johnson SEC
 JNPR Juniper Networks SEC
 JPM JPMorgan Chase & Co. SEC
 JWN Nordstrom SEC
 K Kellogg Co. SEC
 KEY KeyCorp SEC
 KHC Kraft Heinz Co SEC
 KIM Kimco Realty SEC
 KLAC KLA-Tencor Corp. SEC
 KMB Kimberly-Clark SEC
 KMI Kinder Morgan SEC
 KMX Carmax Inc SEC
 KO Coca-Cola Company (The) SEC
 KORS Michael Kors Holdings SEC
 KR Kroger Co. SEC
 KSS Kohl’s Corp. SEC
 KSU Kansas City Southern SEC
 L Loews Corp. SEC
 LB L Brands Inc. SEC
 LEG Leggett & Platt SEC
 LEN Lennar Corp. SEC
 LH Laboratory Corp. of America Holding SEC
 LKQ LKQ Corporation SEC
 LLL L-3 Communications Holdings SEC
 LLY Lilly (Eli) & Co. SEC
 LMT Lockheed Martin Corp. SEC
 LNC Lincoln National SEC
 LNT Alliant Energy Corp SEC
 LOW Lowe’s Cos. SEC
 LRCX Lam Research SEC
 LUK Leucadia National Corp. SEC
 LUV Southwest Airlines SEC
 LYB LyondellBasell SEC
 M Macy’s Inc. SEC
 MA Mastercard Inc. SEC
 MAA Mid-America Apartments SEC
 MAC Macerich SEC
 MAR Marriott Int’l. SEC
 MAS Masco Corp. SEC
 MAT Mattel Inc. SEC
 MCD McDonald’s Corp. SEC
 MCHP Microchip Technology SEC
 MCK McKesson Corp. SEC
 MCO Moody’s Corp SEC
 MDLZ Mondelez International SEC
 MDT Medtronic plc SEC
 MET MetLife Inc. SEC
 MGM MGM Resorts International SEC
 MHK Mohawk Industries SEC
 MKC McCormick & Co. SEC
 MLM Martin Marietta Materials SEC
 MMC Marsh & McLennan SEC
 MMM 3M Company SEC
 MNST Monster Beverage SEC
 MO Altria Group Inc SEC
 MON Monsanto Co. SEC
 MOS The Mosaic Company SEC
 MPC Marathon Petroleum SEC
 MRK Merck & Co. SEC
 MRO Marathon Oil Corp. SEC
 MS Morgan Stanley SEC
 MSFT Microsoft Corp. SEC
 MSI Motorola Solutions Inc. SEC
 MTB M&T Bank Corp. SEC
 MTD Mettler Toledo SEC
 MU Micron Technology SEC
 MYL Mylan N.V. SEC
 NAVI Navient SEC
 NBL Noble Energy Inc SEC
 NCLH Norwegian Cruise Line SEC
 NDAQ Nasdaq, Inc. SEC
 NEE NextEra Energy SEC
 NEM Newmont Mining Corporation SEC
 NFLX Netflix Inc. SEC
 NFX Newfield Exploration Co SEC
 NI NiSource Inc. SEC
 NKE Nike SEC
 NLSN Nielsen Holdings SEC
 NOC Northrop Grumman Corp. SEC
 NOV National Oilwell Varco Inc. SEC
 NRG NRG Energy SEC
 NSC Norfolk Southern Corp. SEC
 NTAP NetApp SEC
 NTRS Northern Trust Corp. SEC
 NUE Nucor Corp. SEC
 NVDA Nvidia Corporation SEC
 NWL Newell Brands SEC
 NWS News Corp. Class B SEC
 NWSA News Corp. Class A SEC
 O Realty Income Corporation SEC
 OKE ONEOK SEC
 OMC Omnicom Group SEC
 ORCL Oracle Corp. SEC
 ORLY O’Reilly Automotive SEC
 OXY Occidental Petroleum SEC
 PAYX Paychex Inc. SEC
 PBCT People’s United Financial SEC
 PCAR PACCAR Inc. SEC
 PCG PG&E Corp. SEC
 PCLN Priceline.com Inc SEC
 PDCO Patterson Companies SEC
 PEG Public Serv. Enterprise Inc. SEC
 PEP PepsiCo Inc. SEC
 PFE Pfizer Inc. SEC
 PFG Principal Financial Group SEC
 PG Procter & Gamble SEC
 PGR Progressive Corp. SEC
 PH Parker-Hannifin SEC
 PHM Pulte Homes Inc. SEC
 PKG Packaging Corporation of America SEC
 PKI PerkinElmer SEC
 PLD Prologis SEC
 PM Philip Morris International SEC
 PNC PNC Financial Services SEC
 PNR Pentair Ltd. SEC
 PNW Pinnacle West Capital SEC
 PPG PPG Industries SEC
 PPL PPL Corp. SEC
 PRGO Perrigo SEC
 PRU Prudential Financial SEC
 PSA Public Storage SEC
 PSX Phillips 66 SEC
 PVH PVH Corp. SEC
 PWR Quanta Services Inc. SEC
 PX Praxair Inc. SEC
 PXD Pioneer Natural Resources SEC
 PYPL PayPal SEC
 QCOM QUALCOMM Inc. SEC
 QRVO Qorvo SEC
 RCL Royal Caribbean Cruises Ltd SEC
 RE Everest Re Group Ltd. SEC
 REG Regency Centers Corporation SEC
 REGN Regeneron SEC
 RF Regions Financial Corp. SEC
 RHI Robert Half International SEC
 RHT Red Hat Inc. SEC
 RJF Raymond James Financial Inc. SEC
 RL Polo Ralph Lauren Corp. SEC
 RMD ResMed SEC
 ROK Rockwell Automation Inc. SEC
 ROP Roper Technologies SEC
 ROST Ross Stores SEC
 RRC Range Resources Corp. SEC
 RSG Republic Services Inc SEC
 RTN Raytheon Co. SEC
 SBAC SBA Communications SEC
 SBUX Starbucks Corp. SEC
 SCG SCANA Corp SEC
 SCHW Charles Schwab Corporation SEC
 SEE Sealed Air SEC
 SHW Sherwin-Williams SEC
 SIG Signet Jewelers SEC
 SJM JM Smucker SEC
 SLB Schlumberger Ltd. SEC
 SLG SL Green Realty SEC
 SNA Snap-On Inc. SEC
 SNI Scripps Networks Interactive Inc. SEC
 SNPS Synopsys Inc. SEC
 SO Southern Co. SEC
 SPG Simon Property Group Inc SEC
 SPGI S&P Global, Inc. SEC
 SRCL Stericycle Inc SEC
 SRE Sempra Energy SEC
 STI SunTrust Banks SEC
 STT State Street Corp. SEC
 STX Seagate Technology SEC
 STZ Constellation Brands SEC
 SWK Stanley Black & Decker SEC
 SWKS Skyworks Solutions SEC
 SYF Synchrony Financial SEC
 SYK Stryker Corp. SEC
 SYMC Symantec Corp. SEC
 SYY Sysco Corp. SEC
 T AT&T Inc SEC
 TAP Molson Coors Brewing Company SEC
 TDG TransDigm Group SEC
 TEL TE Connectivity Ltd. SEC
 TGT Target Corp. SEC
 TIF Tiffany & Co. SEC
 TJX TJX Companies Inc. SEC
 TMK Torchmark Corp. SEC
 TMO Thermo Fisher Scientific SEC
 TPR Tapestry, Inc. SEC
 TRIP TripAdvisor SEC
 TROW T. Rowe Price Group SEC
 TRV The Travelers Companies Inc. SEC
 TSCO Tractor Supply Company SEC
 TSN Tyson Foods SEC
 TSS Total System Services SEC
 TWX Time Warner Inc. SEC
 TXN Texas Instruments SEC
 TXT Textron Inc. SEC
 UA Under Armour Class C SEC
 UAA Under Armour Class A SEC
 UAL United Continental Holdings SEC
 UDR UDR Inc SEC
 UHS Universal Health Services, Inc. SEC
 ULTA Ulta Salon Cosmetics & Fragrance Inc SEC
 UNH United Health Group Inc. SEC
 UNM Unum Group SEC
 UNP Union Pacific SEC
 UPS United Parcel Service SEC
 URI United Rentals, Inc. SEC
 USB U.S. Bancorp SEC
 UTX United Technologies SEC
 V Visa Inc. SEC
 VAR Varian Medical Systems SEC
 VFC V.F. Corp. SEC
 VIAB Viacom Inc. SEC
 VLO Valero Energy SEC
 VMC Vulcan Materials SEC
 VNO Vornado Realty Trust SEC
 VRSK Verisk Analytics SEC
 VRSN Verisign Inc. SEC
 VRTX Vertex Pharmaceuticals Inc SEC
 VTR Ventas Inc SEC
 VZ Verizon Communications SEC
 WAT Waters Corporation SEC
 WBA Walgreens Boots Alliance SEC
 WDC Western Digital SEC
 WEC Wec Energy Group Inc SEC
 WFC Wells Fargo SEC
 WHR Whirlpool Corp. SEC
 WLTW Willis Towers Watson SEC
 WM Waste Management Inc. SEC
 WMB Williams Cos. SEC
 WMT Wal-Mart Stores SEC
 WRK WestRock Company SEC
 WU Western Union Co SEC
 WY Weyerhaeuser Corp. SEC
 WYN Wyndham Worldwide SEC
 WYNN Wynn Resorts Ltd SEC
 XEC Cimarex Energy SEC
 XEL Xcel Energy Inc SEC
 XL XL Capital SEC
 XLNX Xilinx Inc SEC
 XOM Exxon Mobil Corp. SEC
 XRAY Dentsply Sirona SEC
 XRX Xerox Corp. SEC
 XYL Xylem Inc. SEC
 YUM Yum! Brands Inc SEC
 ZBH Zimmer Biomet Holdings SEC
 ZION Zions Bancorp SEC
 ZTS Zoetis SEC

How do I short a stock?
To short a stock — and this applies only to stocks, not ETFs — go to your broker site (make sure you’re set up for a margin account, which lets you borrow shares), enter the ticker, and use the command “sell to open” or “sell short.” If your stock is available for shorting — not all are — when you make the trade, you’ll see a lent payment, as a negative number, in your account. If the stock goes down, you can buy it back any time with the command “buy to close” at the lower share price. The difference is your profit.

If the stock price increases, you’ll eventually need to buy it back at the higher price and suffer the loss, so make sure you have cash to cover this possibility. In most cases, selling short is a short-term strategy measured in minutes to months rather than years.

Strings attached
There are a few issues to keep in mind with shorts: Unlike futures, you need to cough up any dividends while you borrow the shares. Second, you’ll be paying interest on the loan you’ve taken to borrow the shares, so you need to factor that into your bottom-line projections. Finally, you could be given the short squeeze: If your stock price goes up, your broker can force you out of your short position if it needs to deliver the shares back to the owner. This cannot occur trading futures.

Exchange Traded Funds, (ETF’s)

Below are 50 of the top performing ETF’s, careful with these liquidity is sometimes questionable.

Seeking Alpha ETF Last 52 Week + or –
 YINN Direxion FTSE China Bull 3X 42.13 140.33%
 NAIL Direxion Homebuild & Suppliers Bull 3X 67.57 131.56%
 CWEB Direxion CSI China Internet Idx Bull 2X 53.99 128.67%
 USOU United States 3X Oil Fund 52.14 114.39%
 LABU Direxion S&P Biotech Bull 3X 85.12 101.99%
 SOXL Semiconductor Bull 3X Direxion 136.02 99.59%
 HOML Etracs Mt Reset 2X ISE Exc Homebuilders ETN 52.42 96.46%
 EDC Emrg Mkts Bull 3X Direxion 126.32 91.92%
 TECL Technology Bull 3X Direxion 109.47 91.21%
 TQQQ Ultrapro QQQ Proshares 143.45 90.00%
 GRN Global Carbon ETN Ipath 11.18 89.81%
 XPP Ultra FTSE China 25 Proshares 97.45 88.02%
 DFEN Direxion Daily Aerospace Defense Bull 3X Shares 45.12 83.27%
 UDOW Ultrapro DOW 30 Proshares 88.25 78.50%
 CHAU Direxion CSI 300 China A 2X 33.75 78.29%
 OILU Ultrapro Crude Oil Proshares 43.85 77.17%
 ARKK Ark Innovation ETF 38.39 71.54%
 ARKW Ark Web X.0 ETF 47.03 70.40%
 CXSE Wisdomtree China Ex-Cso Fund 88.27 69.42%
 KORU Direxion South Korea Bull 3X 54.06 69.31%
 EURL Direxion FTSE Europe Bull 3X 36.27 63.90%
 USD Ultra Semiconductors Proshares 116.63 61.38%
 ROM Ultra Technology Proshares 87.28 59.02%
 KWEB Kranes CSI China ETF 60.49 58.27%
 XIV VS -1X VIX Short Term 99 57.92%
 EET Ultra MSCI Emrg Mkts Proshares 94.54 57.67%
 INDL India Bull 3X Direxion 89.02 57.06%
 FINU Ultrapro Financials Proshares 104.5 57.00%
 FCA China Alphadex Fund FT 32.1 55.84%
 QLD Ultra QQQ Proshares 75.23 55.77%
 FBGX FI Enhanced Large Cap Growth ETN 232.12 54.80%
 DZK Dev Mkts Bull 3X Direxion ETF 78.2 53.85%
 CHIQ G-X China Consumer ETF 18.48 52.85%
 CURE Healthcare Bull 3X Direxion ETF 46.58 52.57%
 UPRO Ultrapro S&P 500 Proshares 134.01 52.49%
 FLGE CS FI Large Cap Growth Enhanced ETN 229.06 52.24%
 JPNL Direxion Japan Bull 3X 74.06 52.23%
 CQQQ China Technology ETF Guggenheim 59.66 52.12%
 BBC Bioshares Biotech Clinical Trial 30.94 51.54%
 FAS Financial Bull 3X Direxion 65.03 50.25%
 EMQQ Emrg Mkts Internet and Ecommerce Etc 38.54 50.19%
 IBUY Amplify Onln Rtl ETF 42.5 49.91%
 GAMR Purefunds Video Game Tech ETF 47.52 48.97%
 BOTZ G-X Robotics & Artificial Intel Thmtc ETF 24.41 48.48%
 DDM Ultra DOW 30 Proshares 126.84 47.92%
 MCHI China Index MSCI Ishares 69.58 47.70%
 PGJ Golden Dragon China Powershares ETF 45.86 47.60%
 NGE G-X Nigeria Index ETF 24.23 47.38%
 PTH Dynamic Healthcare Powershares 75.41 47.08%
 REMX Rare Earth/Strategic Metals Vaneck ETF 28.52 46.86%

How Do I Short an ETF?

Once you decide you are ready to put on a short ETF position in your portfolio there are two ways to accomplish your goals.

Sell an ETF – The most obvious way is to call your broker or log onto your online account and make a short ETF transaction. You can sell an ETF at the market (be careful with volatile ETFs) or you can designate a certain price point (again be careful, there is the possibility you do not get your order filled if the price falls).

Buy an Inverse ETF – Due to trading restrictions or margin limitations, there may be times it’s not possible to sell an ETF. A short ETF has greater risk than a long ETF position since the risk is unlimited to the upside. With a long ETF position, the risk is limited to the price of $0. So, to help investors create short ETF positions without actually selling an ETF, some ETF providers created inverse ETFs – designed to track the inverse price of an index or underlying asset. As the price of the underlying product falls, the price of an inverse ETF rises. Perfect for those who want a short ETF position, but can’t actually sell an ETF. of our collared position because we own the put.

Procedure for identifying the trend using the tools on SeekingAlpha

Click on the stock of your choice, example A , Agilent Technologies

Open the advanced chart

Set display to candels

Choose indicator

Select Moving Average Exponential

Check the EMA

It should be defaulted to 9

Setting your EMA9
Use the link at the top of the chart to sent your EMA9  (1 minute to one month)
Intraday, use 1 to 5 minutes (careful prices are delayed)
Trade duration 2 to 10 days, use daily bars (D)
Trade duration 11-29 days, use weekly bars (W)
Trade duration 30-90 days, use monthly bars (M)

Trend

Above the EMA9 = long
Below the EMA9 = short

The EMA by itself will do a reliable job of defining trend however if you want to take it a step further drop in these indicators.

Set display to candels

Choose indicator

Select Moving Average Exponential

Check the EMA

It should be defaulted to 9

Setting your EMA9
Use the link at the top of the chart to sent your EMA9  (1 minute to one month)
Intraday, use 1 to 5 minutes (careful prices are delayed)
Trade duration 2 to 10 days, use daily bars (D)
Trade duration 11-29 days, use weekly bars (W)
Trade duration 30-90 days, use monthly bars (M)

Trend

Above the EMA9 = long
Below the EMA9 = short

The EMA by itself will do a reliable job of defining trend however if you want to take it a step further drop in these indicators.

Short Term Indicators
  7 Day Average Directional Indicator SELL Maximum Strongest
  10 – 8 Day Moving Average Hilo Channel SELL Maximum Strongest
  20 Day Moving Average vs Price SELL Maximum Strongest
  20 – 50 Day MACD Oscillator BUY Maximum Weakest
  20 Day Bollinger Bands SELL Maximum Weakest
20 – Day Average Volume: 0 Average: 60% SELL
Medium Term Indicators
  40 Day Commodity Channel Index HOLD Bearish
  50 Day Moving Average vs Price SELL Weak Strongest
  20 – 100 Day MACD Oscillator BUY Maximum Weakest
  50 Day Parabolic Time/Price SELL Maximum Strongest
50 – Day Average Volume: 0 Average: 25% SELL
Long Term Indicators
  60 Day Commodity Channel Index HOLD Bearish
  100 Day Moving Average vs Price BUY Minimum Weakest
  50 – 100 Day MACD Oscillator BUY Maximum Strengthening
100 – Day Average Volume: 0 Average: 67% BUY

It’s hard to find a desk these days that handles 3 way premium neutral orders that provides efficient execution. You just can’t leg into them. I personally had to try 11 desks before I found 1 in Chicago (run by an X floor trader, older guy but still on his game) and one in London I use for European and Asian indices. It costs a few bucks more but I’d rather pay an extra $30.00 on a 3 way in commission than lose $150.00 on the fill when the contract is only worth $125,000.00 at an S&P price of 2,500.00.

Looking forward to the volatility looks like 2018 is shaping up to be a very fun year to trade.

Additional disclosure: I’ve been a professional trader and run a family office from Tortola, British Virgin Islands for the past 20+ years, zero income, corporate, sales and inheritance tax and would like to keep it that way. Because of the potential tax implications I do not manage U.S. accounts or sell advisory services to U.S. clients. I do however manage funds for qualified non-U.S. investors and entities. I may at times for my own accounts or for the accounts I manage have positions on that could be contrary to the ones mentioned in my reports.

Fee Structure 

  • AIM Advisory & Risk Control Agreement
  • 0.00%  Front load
  • 0.00%  Management fee
  • 12.50% Of net new high profits quarterly
  • Net new highs (calculated after all brokerage, exchange and regulatory fees have been deducted including those on open positions).
  • Quarterly incentive fees have to be approved by the client prior to be deducted from the account.

If you have questions or comments send us a message or  schedule an online review

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Disclosure

Defining Overall Risk For Your Account Before the First Trade Goes On

  • Should the account fall below your defined maintenance balance as of the settlement on any trading day our team will automatically liquidate all positions on or before the next settlement and report back to you.
  • If we fail to liquidate on or before the next settlement we would liable for any losses from that settlement forward
  • Trading Authorization is automatically revoked.
  • Any new positions would be deemed unauthorized and transferred to the Asset Investment Management (AIM) error account immediately.

If you have questions or comments send us a message or  schedule an online review

—————————————————————-

Disclosure

 

Automated Trading Accounts (ATA), what they are and how they work  

8.1) As our ATA Client you maintain control of

  • The market(s) you trade and when
  • The methodologies you trade
  • The level of leverage that suits your risk tolerance
  • The overall risk for your account

8.2) The ATA Team’s responsibilities include 

  • Calculating entries, risk levels and profit objectives
  • Placing all orders and diligently overseeing executions, positions and balance
  • Monitoring total account risk to ensure it is within your defined guidelines
  • Ensuring everything is done correctly and assuming liability if it’s not
  • Answering all your questions on markets and methodologies

8.3) About this ATA

  • This ATA uses fully disclosed trading methodology.
  • Trades with the trend long or short.
  • Uses option collars that define risk on every trade and duration of every trading period.
  • Trades in this ATA cannot be stopped out regardless of market volatility.
  • The only way a position can be called away is at a profit
  • If the market stays the same this ATA hasn’t wasted precious investment capital on purchasing option time premium as it’s collecting approximately as much  time premium on the covered writes at the profit objectives, as it’s paying out on the purchased options that define maximum trade risk.
  • Option collars can be offset at any time locking in gains and/or modified to capture more of the move or, reversed to capture a trend reversal.
  • Mark-to-market positions and balance are available online at any time.
  • Statements are emailed daily disclosing positions, liquidating value and any trading activity
  • Monthly statements summarize all activity and end of month balance.
  • Liquidity for ATA accounts in portion or all is 2 to 48 hours in any major currency.
  • AIM ATA’s afford you the opportunity to modify markets, units you trade and your overall account risk level at any time.

If you have questions or comments send us a message or  schedule an online review

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Disclosure

 

Defining number of positions, risk levels and profit objectives

1) Trading procedure

1.1) Define trend using this procedure
1.2) Define trade risk using this procedure

2) Define number of contracts traded

This program trades up to 5 contracts with the trend up or down using “option collars  that define risk on every trade and for the duration of every trading period.

  • Up toshort-term positions, trade duration 2 to 10 days
  • Up tomedium-term, trade duration 11-29 days
  • long-term, trade duration 30 to 90 days
  • Total margin requirement is less than $15,000 USD or major currency equivalent as all positions are fully hedged.

2.1) Trade duration and number of contracts traded are determined by the opinion  For example a weak trend would justify having 1-2 short-term positions, intermediate strength +1-2 additional medium-term positions, strong  +1 for a long-term, total 5, all are collared, all have defined risk. 

2.2) And relative strength  increasing add positions, decreasing lighten up.

3) Profit objectives/risk levels are dependent on the trade duration,

Short term = 2 to 10 days
Medium term = 11 to 29 days
Long term = 30 to 90 days

And corresponding support -resistance levels and turning points

3) Trading parameters for short, medium and long-term positions.

3.1) Long-term trend, is the monthly price action above or below the EMA9  linked here? above = buy, below = sell.

Trade duration 30 to 90 days

In this example price action is above the EMA9 using monthly price action, the long term trend is higher but deteriorating, long term, long positions would be permitted if confirmed buy the overall average and long-term indicators linked below.

Does the overall average and long-term technical opinion linked here  agree with the EMA9?

In the example the EMA9 was a buy, indicators a sell.

If the EMA9overall average and long-term indicators all agree long term trades of 30 to 90 days in duration are permitted using defined risk strategy.

In the example above no new trades would be permitted, an existing long term trade would have been liquidated. (total long-term positions permitted per unit 1)

EMA9 using monthly data = buy
Overall average = 48% sell
Long term indicators = hold

3.2) Medium-term trend, is weekly price action, above or below the EMA9  linked here? above = buy, below = sell.

Trade duration 11 to 29 days

In this example price action is below the EMA9 using weekly price action the market is in a down trend, medium-term, short positions are permitted.

Does the overall average, and medium-term technical opinion  linked here  agree with the EMA9?

In the example yes

If the EMA9overall average and medium-term indicators all agree medium-term trades of 11 to 29 days in duration are permitted using defined risk strategy.

EMA9 using weekly data = sell
Overall average = 48% sell
Medium term indicators = 50% sell

In this example all agree, overall average and medium-term indicators are equal too or below 50%, only 1 medium-term short position is permitted, when both the overall average and medium-term indicators are greater than 50.00% a secondary medium-term position is permitted, (total permitted per unit 2).

3.3) Short-term trend, is daily price action, above or below the EMA9 linked here  above = buy, below = sell.

In this example price action is below the EMA9 using daily price action the market is in a short-term downtrend, sort-term, short positions permitted.

Trade duration 2 to 10 days

Does the overall average and short-term technical opinion  linked here  agree with the EMA9?

In this example yes

If the EMA9overall average and short-term indicators all agree short-term trades of 2 to 10 days in duration are permitted using defined risk strategy.

EMA9 using daily data = sell
Overall average = 48% sell
Short-term indicators = 60% sell

In this example all agree, overall average is 48% sell, short-term indicators are 60% sell. You would already be short 1 contact in this example looking to add an additional short position when the overall average moves from 48.00% to above 50%. When both the overall average and sort-term indicators are greater than 50.00% a secondary short-term position is permitted, (total permitted per unit 2).

3) Summary

Define the trend using the EMA9

4.1) 6 month chart (daily data) used for short term trades (2 to 10 days)
4.2) 2 year chart (weekly data) medium term trades (11-29 days)
4.3) 7 year chart (monthly data) long term trades (30 to 90 days)

Set you profit objective and collar up your risk

4.4) Futures quotes
4.5) Options quotes
4.6) Support -resistance levels and turning points

If you have questions or comments send us a message or  schedule an online review

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Disclosure

Defining risk on every trade and for the duration of every trading period 

If you have questions send us a message, or schedule an online, using these links we’ll walk you through this procedure.

How this program controls risk is by “collaring” every trade

  • A collar defines risk on the trade and for the duration of the trading period
  • Collars eliminate any possibility of the position being stopped out.
  • Because trade risk is objectively defined the margin requirement on the majority of trades is reduced.
  • Properly set up a collar is premium neutral (they don’t waste money on net purchases of option time premium to define risk)

1) Procedure for collared long positions 

1.1) On the 15th of September 2017 (TIPTrend identification procedure linked here  is telling you the S&P is in a medium-term uptrend and to structure your trade for 11 to 29 days.

You enter a long futures position at 2,500.00
Contract value $125,000.00

1.2) Determine the profit objective

To simplify determining the profit objective for this medium-term trade I am continuing the angle of the slope on the medium-term EMA9 chart out 29 days to generate the profit objective of 2,550.00

Profit objective at 2,550.00
Contract value $127,500.00


To learn the specifics on how we set profit objectives please schedule an online and I’ll walk you through it using these links.  

2) Collar procedure

You’re long futures on 15 September 2017 at 2,500 (contract $125,000.00)

2.1) You write an out of the money, call option against your 2,500.00 long futures position at the strike price that is closest to the profit objective, in this example 2,550.00

2.2) You choose an options expiration that is consistent with the TIP  defined trade duration (in this example on the 13th of October 2017

2.3) When you write an out of the money option against your position you collect option premium in this example we collected 15.00 points or +$750.00.

 

2.4) Using the collected premium of 15.00 points, $750.00 from the sale of the 2,550.00 call we buy a put option.

2.4) The put option purchased must have the same option expiration as the call we wrote, in this example the 13th of October 2017.

2.5) The option premium price paid for the put option should be approximately the same amount or less than what you’ve collected from the call write in this example we collected 15.00 points, $750.00.

2.6) The put strike price should be approximately the same amount from entry. In this example we’re long futures at 2,500.00, wrote the call at 2,550.00 or the call we wrote is 50 points out of the money therefore the put we purchase should be at a strike of 2,5000.00 – 50.00 = 2,450.00 or higher.

2.7) we purchase the 2,450.00 put with an expiration date of the 13th of October 2017 for 17.00 points or $850.00.

2.8) The put objectively defines risk on the 2,500.00 long position for the duration of the trading period ( entry date 15 September 2017 to 13 October 2017 expiration)

2.9) The put negates any possibility of  of this position being stopped out for the duration of the trading period.

2.10) Summary
Collected on the 2,550.00 call write, = 15.00 points at our profit objective
Paid out on the 2,450.00 put -17.00 points to objectively define risk

Net cost of the hedge = 2.00 points or $100.00,  which defines risk on a contract worth $125,000 from the 14th of  September 2015 until  the 13th of October 2017. 

3) Potential outcomes for this trade

3.1) The market stays the same and settles on the 13th of October 2017 at 2,500.00

3.2) Trade Result

The call we wrote at 2,550 expires worthless, +15.00 points = +$750.00

The 2,500.00 long futures settles unchanged at 2,500.00 = $0.00

The 2,450 put purchased expires worthless, we lose 17.00 points = -$850.00

Total bid/ask spreads, commission, exchange & regulatory fees =-$159.78

All in net profit or loss = -$259.78

3.3) The market moves hard against us

The market drops from our entry price of 2,500.00 (contract value = $125,00.00) down 600.00 points -24.00% to 1,900.00 contract value $95,000 in “fast market action”.

If a percentage drop like this occurred, it would have no impact on the maximum risk of  this collared position because we own the put.

The put objectively defines risk on the 2,500.000 long for the duration of the trading period.

The maximum risk (in this example) is the distance between our entry at 2,500.00 contract value $125,000.00 to where the put engages at 2,450.00, contract value $122,250.00, maximum loss $2,500.00 regardless if this market moved to zero.

3.4) Trade Result

Loss on the 2,500.00 long futures position (600.00) points = -$30,000.00

The call we wrote at 2,550.00 expires worthless +15.00 points =+$750.00

The put we own at 2,450.00 is profitable 533.00 points =+$26,650.00

Total bid/ask spreads, commission, exchange & regulatory fees =-$159.78

All in net loss = -$2,759.78

A $100.00 hedge prevented a potential loss on this position of $30,000.

3.5) The market moves higher in our favor 

The established trend continues higher and the price moves from our entry on the 15th September 2017 at 2,500.00, contract value $125,000 to our profit objective of 2,550.00 contract value $127,500 on or before the 13th of October 2017.

3.6) Trade Result

Gain on the 2,500.00 long futures position 50.00 points = +$2,500.00

The call we wrote at 2,550.00 is offset by the futures, we keep the 15.00 points in collected premium =+$750.00

The put we own at 2,450.00 expires worthless -17.00 points =-$850.00

Total bid/ask spreads, commission, exchange & regulatory fees =-$159.78

All in net profit or loss = $2,240.22.

4) Procedure for short positions

4.1) On the 1st of  February 2018 (TIPTrend identification procedure linked here  is telling you the S&P is in a short-term downtrend and to structure your trade for 2 to 10 days.

You enter a short futures position at 2,815.00
Contract value $140,750.00

 

4.2) Determine the profit objective

To simplify determining the profit objective for this short-term trade I am continuing the angle of the slope on the short-term EMA9 chart out 10 days to generate the profit objective of 2,740.00

Profit objective at 2,740.00
Contract value $137,500.00

To learn the specifics on how we set profit objectives please schedule an online and I’ll walk you through it using these links.  

5) Collar procedure

You’re short futures on 2 February 2018 at 2,815 (contract $140,750.00)

5.1) You write an out of the money, put option against your 2,815.00 short futures position at the strike price that is closest to the profit objective, in this example 2,740.00

5.2) You choose an options expiration that is consistent with the TIP  defined trade duration (in this example on the 9th of February 2018.

5.3) When you write an out of the money option against your position you collect option premium in this example we collected 27.00 points or +$1,350.00.

 

5.4) Using the collected premium of 27.00 points or +$1,350.00 from the sale of the 2,740.00 pt we buy a call option.

5.5) The call option purchased must have the same option expiration as the put we wrote, in this example the 9th of February 2018.

5.6) The option premium price paid for the call option should be approximately the same amount or less than what you’ve collected from the put write in this example we collected 27.00 points or +$1,350.00

5.7) The call strike price should be approximately the same amount from entry. In this example we’re short futures at 2,815.00 , wrote the out at 2,740.00 or the put we wrote is 75 points out of the money therefore the call we purchase should be at a strike of 2,815.00 + 75.00 = 2,890.00 or lower.

5.8) We purchase the 2,890.00 call with an expiration date of the 9th of February 2018 for 16.00 points  or –$800.00.  

5.9) The call objectively defines risk on the 2,815.00 short position for the duration of the trading period (entry date 2nd of February 2018 to the 9th of February 2018 expiration)

5.10) The call negates any possibility of  of this position being stopped out for the duration of the trading period.

5.11) Summary

Collected on the 2,740.00 put write, = 27.00 points at our profit objective
Paid out on the 2,890.00 call -16.00 points to objectively define risk

Net cost of the hedge = +9.00 points or $550.00,  in this example we we’re paid to define risk on a contract worth $140,750 from the 2nd of February 2018 to the 9th of February 2018 . 

 

6) Potential outcomes for this trade

6.1) The market stays the same and settles on the 9th of February 2018  unchanged from our entry at 2,815.00.

6.2) Trade Result

The put wrote at 2,740.00 expires worthless, we keep the 27.00 points = $1,350.00

The 2,815.00 short futures settles unchanged at 2,815.00 = $0.00

The 2,890.00 call purchased expires worthless, we lose 16.00 points = -$800.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78

All in net profit or loss  = +$390.22

6.3) The market moves hard against us

We rally from our short entry at 2,815.00 (contract value = $144,500.00) by 300.00 points +10.66% to 3,115.00 contract value $155,750 in “fast market action.

If a  rally like this occurred it would have no impact on the maximum risk of our collared position because we own the call.

The call objectively defines our risk on the trade and for the duration of the trading period. The maximum risk (in this example) is the distance between our entry at 2,815.00 contract value $140,750.00 to where the call engaged at 2,890.00 contract value $144,500.00

6.4) Trade Result

Loss on the 2,815.00 short futures position is 300.00 points = -$15,000.00

The put we wrote at 2,7400 expires worthless +27.00 points =+$1,350.00

The call we own at 2,890.00 is profitable for 209.00 points =+$10,450.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78

Net loss = -$3,359.78.78

In this example we were paid $+550.00 to prevent a potential loss of $15,000

6.5) Market moves lower in our favor

The trend continues lower,  the contract moves from our entry on the 1st of February 2018 at 2,815.00, contract value $140,750.00 to our profit objective of 2,740.00 contract value $137,000 on or before the 9th of February 2017.

6.6) Trade Result

Gain on the 2,815.00 short futures position 75.00 points = $3,750.00

The put we wrote at 2,740.00 is offset by the short futures position  we keep the +27.00 points in collected time premium = +$1,350.00

The call we purchased at 2,890.00 expires worthless -18.00 points = -$800.00

Total bid/ask spreads, commission, exchange & regulatory fees = -$159.78

All in net gain or loss = $4,140.22

7) S&P 500 Collar Spreadsheet

  • Open with Excel
  • Click OK
  • Enable editing
  • Enable content

If you need us to review this with you prior to opening an account please or  schedule an online review or if you have any questions send us a message

 

Regards,
Peter Knight Advisor

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Disclosure