doe anyone have any good books for fixed income? specifically on trading high yield/investment grade/treasury/cds?

Gotya, thanks. That was the impression I was getting from my googling as well. How about market making? Shouldn't there be "domestic" market makers in each country, or are the big players involved everywhere?

I need to build a fixed income portfolio and am in the process of investigating various bond ETFs and MFs. I've done some reading and found there are these basic classes of bond funds:

Municipal - National
Municipal - California (where I live)
Emerging Markets
High Yield
Inflation-Protected
Intermediate Government
Intermediate Term
Long Government
Long Term
Short Government
Short Term
World

However, I haven't been able to find *any* references that take some input and then suggest a good asset allocation plan among these classes.

Do you know of any allocation wizards or even just examples of allocation among the various types of bonds?

Please provide references if you know of any.

Thanks,
C.

Not sure if it should go in here or maybe in it's own topic. But I've been buying up some corporate (euro) debt (bonds, etc) the last few months and I've been wondering about something.

All the euro countries issue their own sovereign debt and I was wondering if it was possible to make a profit doing arbitrage between these different countries. I realize that this market is dominated by institutions and professionals and that my edge is probably 0% (if not negative) so I'll keep this in theory.

I assume that the northern Euro countries (Germany, the Netherlands mainly) have a lower yield on their debt than their Mediterranean counterparts (Spain, Italy and Greece). I haven't been able to find any quotes besides for the Netherlands and Germany so if someone could help me with this it's really appreciated. So assuming there is a difference in yield could you theoretically short the German bunds and buy the Italian bonds and be left with a small yield that represent the extra default risk that Italy carries? Would this work and how would you theoretically execute such a trade?

I realize this is something LTCM would've done if they were around for the euro and that they would probably blow up on something like this. Because I guess if Silvio Berlusconi says something dumb the Italian debt yield goes up.

By the way, I know it's a credit spread but I was wondering how it would work in the example I described.

hi, i'm 37 and have money in an ira for retirement. the money is split into 5 mutal funds:

us stock index
us bond index
international stock index
international emerging market stock
interantional emerging market bond

the money in the us stock index is in the fidelity total market fund (fstmx). does this give me enough exposure to small caps? i was considering adding a vanguard small cap index fund (naesx) but i just got my portfolio down to 5 funds and i hate to start adding funds unless i really need to. thx.

Hey I wants help! Can someone explain to me what a derivitive is?

This is what wikipedia says:

wtf does that mean? : (

So this is what I got so far. Lets say you want to do a derivative. What you are doing is signing a contract that says so and so will sell a stock or a bond or something to you at a certain time in the future. I think your suppossed to have it in the contract that you get it at whatever its current value is, so when they sell you it in the future, if the value of it has gone up, you maker monies? Am i warm?

I got a question about BFI job opportunities:

what type of stuff can I get into if I speak russian and English fluently?
I am still in college, but eventually I will grad. And will need to get a job.

Does being bilingual in Russian and English mean anything? My dad is a biologist and he has done interpreting work unrelated to BFI. I am taking Econ and Bus. classes...

You aren't signing a contract, you're buying a contract. The contract is a deal between you and another party, that you are entitled to XXX at XX/XX/20XX. If you hold the contract till the date mentioned, you are entitled to that underlying (ie the thing the contract is written about). There's different futures trading exchanges with regulations so each party has to abide by the rules. You can get a futures contract for anything, stock index's, commodities, currencies etc.

Almost all people roll the contract forward to another date and don't accept delivery, but its the potential to accept delivery that gives the future contract its value. You probably won't understand that concept though because it requires a feel for why future contracts exist.

You can work with the state department, providing you can get security clearance (no felonies etc). Business wise I guess you could work for a company that is involved in both Russia and the US but most would recruit through schools I'd imagine, so talk to your college career people.

Also, 'learning' russian is really difficult, but also getting to the point of being practical with it is even harder unless you're prepared to live there for a little while. If you're serious and like the language, maybe look at doing an exchange program for 6 months or doing a 4 month program for learning Russian. It'll cost money but you can't learn Russian from college courses alone, at least not at a level that anyone in business/government will care about. Or get a russian bride I guess :P

Also spaceman, I find the easiest way to read jargon is to get a pen and paper, dissect the sentences, and use pictures to try and represent what's going on. Try and draw the transactions that are taking place using little stick figures or whatever. With my brain I find it difficult sometimes with new concepts, but even with advanced ones, the old pen, paper and pictures with a lot of staring and thinking it usually clicks after a little while.

I posted this in the book thread, but no one is responding to that. Arturius seems really knowledgeable and is answering questions here, so I was just going to post it here. Thanks in advance guys!

You have to be really dedicated to learn C++ as your first language and its even worse if its your introduction to computers if you have no prior knowledge of computer logic. There's really no reason to learn C++, if you want to learn programming, learn to program with something that has an easier syntax so you won't have to spend your rookie days learning a thousand things to put into your code which you won't understand. Programming is the same in every language, minus the accent. I'd start with python.

And to be honest, your idea is what a million people have, not just poker players. Loads of guys see trading as their way of making some side money, because hey they're above average and they'll work hard and anything can be achieved with that. But the truth is there's a huge learning curve which is unknown, but this is a minor problem. Even worse, the game is substantial rigged against retail trading and to make a cut off the money floating around require not only intelligence, but creativity and clout. Its not a linear progression of making money, you can literally be a losing trader, then get it, then be clearing 7 figures. Or you can just never get it.

So my advice to you is to forget about ever trading for money. Pretend its never an option, pretend you'll never be profitable. Do everything for fun. Do it out of curiosity, just to see how far it goes. Plan your life without trading. You might get really lucky and it turns out you have a knack. But its very improbable. Learning programming and stuff like excel as well as finance stuff is useful for things other than trading, so don't think that all this effort into those things is in vein. Technical Analysis is a good start and I'd recommend that book.

Hey,

I know some other programming languages already. My first business was programming websites for people, PHP/MySQL, among other languages(HTML,CSS,etc). I'm not sure how much they are alike yet.

Also, I'm not really planning to learn anything so that I can learn to trade on the side quite yet. I am more focused on learning things helpful for getting a job in the industry for when I get out of college if other things don't work out. So basically I want to make sure my Option B is solid if Option A fails. I don't expect to be able to beat the markets or know what I'm doing coming out of college, but I would love to be able to know enough to have a slight upper hand on other kids coming out of college looking to go into the same industry.

If trading on the side was my definite route, then I would have enough money to really broaden my horizons. A big portfolio can do wonders, and I could also go a lot of different routes for "training" if I made it in business. So basically, I don't even necessarily have to "study" for trading being a side money maker, I'm only studying for the chance that I need it to get into the industry and all.

If this post changes your opinion on the subject feel free to tell me so, but if not thanks for the advice on the book I'm reading being a good start.

Hello :
Im a poker player who makes a living from it.
I want to start to learn trading as poker give me the financial resourses to study.
I dont know anything about markets , even a clue , but I know with hard work , study and sharing ideas it is possible to make some decent money.
I have read ArturiusX guide , plus all sticky but they recommend so much books , blogs and articles that im lost.
I couldnt find a begginners section to post this.
What is the best way to start ?
Is day-trader the best option to learn , and then adapt to another style ?
I want to start with low money. Is that posible ?
Is there a begginer site to read how the world of markets work?

Thanks in advance

Your strategy sounds solid then. I was just worried someone with minimal programming experience is starting with C++, which seems like suicide to me. If you have a background then I retract that statement. Just learn and don't get to fixated on the potential, run with it and see where it goes.

First time posting in this forum, and looking to start investing in the near future. After researching some online brokers, I wish to start an account at Interactive Brokers but I have some concerns. To state the relevant parts of my background, I currently reside in the U.S. but will be returning to Japan early next year. I am a Japanese citizen. I will be filing taxes as a resident alien this year.

1. Must I reside in the U.S. to be able to invest at IB? I am moving away from the U.S. in 4-5 months and am looking for an online broker that I would not have to change once I leave the U.S.

2. How do taxes on capital gains work if you are a foreign citizen and reside in the U.S. for only a couple months of a calendar year before leaving the country?

If these answers are a matter of doing more research, some guidance as to where to look would be appreciated. Thanks in advance.

Concerning 1: you don't need to reside in the US to have an IB account. I'm pretty sure you can hold your account while in Japan.

Thanks. That's good news for me.

Anyone have an answer to the latter part (Taxes on capital gains when you plan on residing in two different countries during a calendar year) or can anyone point to any source other than the hundreds of pages long tax treaties?

Hopefully someone here can help me out here.

I'm a college junior and have been just using my ATM/debit card for all purchases, but would rather get a credit card to improve my credit for the future.

I'm 100% confident that I will be able to pay the balances on-time, so I'm not anticipating any fees that way.

In picking a credit card, what else do I have to look for. I did some research but was kind of overwhelming and it's not helping that I don't know exactly what to look for.

My question is basically is there a credit card with essentially $0 in total fees providing I pay my balance on time?

Thanks.

Yes, many, but you might have trouble getting one with no credit history. Your best bet is to look for a student credit card with no annual fee. These cards are offered by Bank of America and probably quite a few other companies as well.

I lied to Interactive Brokers and said I had all the experience they demanded, while in reality I've never made a single trade. Should I be worried about putting money in it? Didn't really worry too much about it when I set up the account, but don't want to put anything in and then have them confiscate my $$$ cause I'm a noob. I've tried extensive googling, but can't seem to get any wiser.

Afaik the questions they ask you is to cover their own ass. They don't want to get accused of letting people with no knowledge trade complex products.

That's what I thought as well, but I must admit I'm a little hesitant since there's a ton of paperwork and I didn't exactly read the fine prints.

Another noob question I'm struggling to find an answer to: do you earn any interest on the funds in your IB account that are not being used in any trades? The only info I've found is someone mentioning that you don't get any interest on the first 10k in your account, but I'd like to know more details since I won't be a very active trader in the beginning.