The price of a commodity futures contract is not the market’s forecast of what the spot price will be in the future. For example, the fact that at the time of writing the price of the December-2016 WTI Crude Oil futures contract is $64.44 does not imply that ‘the market’ expects the price of oil … Continue reading The futures price is not a price prediction
Generally, we have the intuition that forward has worse rate then swap. FX Forwards A forward is a contract that locks in the price at which a counterparty can buy or sell a currency on a future date. The exchange rate is typically today’s rate, adjusted for the interest rate differential in the two currencies. … Continue reading Forward and currency swap
An asset-backed security (ABS) is a security created by pooling non-mortgage assets that is then resold to investors. A collateralized debt obligation (CDO) is a complex type of ABS that can be based on non-mortgage assets, mortgage assets or both together. The ABS evolved from mortgage-based securities (MBS], which are created from pools of mortgage … Continue reading What is the difference between a collateralized debt obligation (CDO) and an asset backed security (ABS)?
Introduction The mirror trading method allows traders in financial markets to select a trading strategy and to automatically “mirror” the trades executed by the selected strategies in the trader’s brokerage account. Traders can select strategies that match their personal trading preferences, such as risk tolerance and past profits. Once a strategy has been selected, all the … Continue reading Mirror trading
What is the ‘130-30 Strategy’ The 130-30 strategy is a strategy that uses financial leverage by shorting poor performing stocks and purchasing shares that are expected to have high returns. A 130-30 ratio implies shorting stocks up to 30% of the portfolio value and then using the funds to take a long position in the … Continue reading 130-30 Strategy
With a Schwab Personal Choice Retirement Account® (PCRA), you can invest in a retirement plan with the freedom of a brokerage account. What is it? A Schwab PCRA is a self-directed brokerage account (SDBA) that resides within your employer-sponsored retirement plan. In addition to the choices typically offered by retirement plans, PCRA lets you invest … Continue reading Personal Choice Retirement Account
The Volcker Rule refers to § 619 (12 U.S.C. § 1851) of the Dodd–Frank Wall Street Reform and Consumer Protection Act, originally proposed by American economist and former United StatesFederal Reserve Chairman Paul Volcker to restrict United States banks from making certain kinds of speculative investments that do not benefit their customers. Volcker argued that such speculative … Continue reading Volcker Rule