I have some basic questions about order execution:

Say I want to put in a limit order to buy WYNN at 52.01 and want a .02 stop loss is this feasible? How does this actually work? Would the price generally move past my stop loss? If so what would be a reasonably sized stop loss?

Quick question. I'm going to passively invest a lump sum (30k-40k). I've been waiting a bit to see if the market was due for a correction because of the big gains in 09. I was pleased to see that this seemed to be the case last week, but Friday+today markets again went up.

My question is, how important is timing when I'm investing passively for the long run? Should I just get into the market now and not wonder when might be the best time?

In the long run (10+ years) timing is unimportant or maybe even dangerous. I assume that you're a novice and because that's the case you have no business trying to outsmart the market.

The best you can do is either put it all in now or invest it in smaller chunks over a fixed period. Remember that once you decide on a plan it's important to stick to it. It's no good to decide you'll invest X every third of the month only to decide on the second month that you're going to wait a few days for a correction.

Opinions differ on if you should dump it all in at once or spread it out, you might want to do some research on that.

The longer you keep your money out of the market, the less 'edge' you'll get from passive investing. To counter this edge, you must be able to time the market sufficiently. But what will happen is, the market will dive, you'll wait for it to go down 'just a little more', then it'll bounce, you'll wait for the next correction which will never come. Or it'll keep going up. Either way, you miss out on valuable time appreciation.

So just do it now and forget it for 10 years.

Just recently looking at some charts, and, although this may be rudimentary to most, I've seen something that I haven't really read about and thought I would ask about it here....

Normally, I (try) to use some charts with both 20MA & 50MA. (I sometimes forget to look at MAs.... newbie curse or something, but it slips my mind alot).

I noticed this morning that, in relation to price action, when the 50MA crosses below the 20MA, I tend to see an uptrend following, and vice-versa; when the 50MA crosses above the 20MA, downtrends ensue.

This makes alot of sense (with the 20MA averaging over 20 periods, and the 50MA averaging over 50, with the 20MA being more volatile, if you will), but something I never paid much attention to until I just noticed it. IS this a type of indicator that anyone uses? I've only looked at about 10 stocks or so this a.m. to see the realtion, and in all cases, this seems to be the case.

So? Anyone use this as an indicator? Am I just seeing things here? Is this something that is commonly known to traders/investors that I discovered accidentally? If so, I would guess the same holds true for the 50ma vs. the 100MA or the 100MA vs. the 200MA.....

arturius,

how much experience do you have in FI? Do you know much about hedging bonds vs treasuries and the reasons hedge funds/IB's use this practice?

Don't know very much about bonds at all, sorry.

They do it do hedge out the interest rate risk. For instance if you are trading MBS and you short similar duration treasuries you end up with a more pure mortgage basis trade. If you are trading corporates you short similar duration treasuries so that you only have the sector/credit risk of the corporates you own. It allows you to trade on a spread basis by removing one of the moving parts from the price movement.

Obviously moving average crossovers have a value, but it is a -EV to just blindly invest when 20MA crosses above the 50.

It works in lots of examples, WHEN THE STOCK IS TRENDING.

I could find some where it crosses back and forth chopping around in a range during which you get killed.

The trouble, obviously, is that you do not know at the time whether you about to jump on a sweet trend or get chop suey-ed.

I just recently started looking into investing and different routes to go. I want to get my feet wet with some small time investing in stocks and go from there. I was looking into scottrade to open account, anyone have opinions on that site ? Or recommendations of something else to start off with?

Why are the 3 month treasury bill yield and 10 year treasury note yield such important economic/market indicators?

The majority of the articles on the economy and the markets that I read mention these benchmarks.
Now I think that because these investments are seen as low risk, a demand in appetite for these investments, which I believe lowers the yield, indicates that investors are risk averse and thus uncertain about the economic outlook.

But somehow this explanation leaves me unsatisfied, if I am right in the first place with my assesment.

I also read that lower yield on treasury notes means lower rates on mortgages. If correct, could someone please explain this to me.

I am 21 years old and have a year and a half left in school.

I have a 13 month CD worth $5K drawing interest right now and after a few years of drawing interest it is at like $5500ish. My question to you all is this: is there anything else I could be doing with this money to put myself in a position to grow?

correctumundo

is the logic good or no? should we buy low? (thinking about buying a house. live in LA, everything is down....so buy? and ride it up?)

Good job taking that post out of context.

so by buying 10yr verizon bonds @ like 99.5 and selling 10yr tres's @ like 100-19 (random ballpark prices) we've sucessfully hedged out the interest rate variance and locked in the spread btwn the bonds initially right? How does that make you money? You're guaranteeing yourself whatever the spread is (say like 250bp) on the yield?

Moving average crossovers work well as both a filter and and a drill down technique. I use MAx a lot. It gives a good idea of the longer term, medium term and shorter term trends. When all timeframes point in the same direction it doesnt make sense (to me anyway) to do something that goes against that grain.

I am very short term oriented and in certain markets and specific market conditions will use MAx for either entry or exit signals using extremely fast printing constant volume bar charts. But the conditions have to be right for me to use this method.

To use something like a 50/20 MAx on a daily chart for entries and exits is suicide. But it can be useful as a filter to tell you which way you want to trade that particular market.

anyone know the answer to my q?

This is of course all very simplified. But here are three ways you could make money with this position.

If you plan to hold the position in a carry trade until the verizon bond matures than you are mostly correct, things such as where you can repo the verzion bond and reverse repo the treasuries will come into play and reduce your profit.
You can make money if spreads tighten.
Or you could be offing the bonds for sale to clients at a tighter level than what you bought them for and make money on the bid/ask spread and volume.

poluytr--is there a book you'd recommend for credit studying? esp the type of stuff you've mentioned above?

hey every1, never posted in here before but have a few queries, and dont laugh at me!
im 20 years old and live in the UK. i want to buy $200 worth of penny stocks in a florida based apparel company (link), but i dont have a clue where to start.
i dont know any brokers, i dont know wtf a portfolio is, i dont know how and where to buy stock online.
the quicker the better btw
ty

ING Sharebuilder is what I used when I was buying cheap stocks.

wont work because im from the UK, know of any other sites?

I've been searching and searching, but can't find any options market makers in Toronto. Anyone know of any? Also, it seems impossible to find any top-tier prop houses there as well. Is there no action in TO?

Chicago is the prop-firm capital of the world with New York in second place. The lack of competition everywhere else means that those firms are more likely to be bucket shops than top-flight trading firms. Just like how if you want to build the next Google you need to be in Silicon Valley, if you want to become the next big trader you need to be in Chicago or New York.