rather than pick out individual stocks to trade, it can often be worthwhile to trade the indices themselves, especially in times of high volatility.

for those so inclined, i attach below charts for FTSE and FTSE 250, though one might equally be tempted to trade Dow or S&P, which is significantly broader in its coverage, or even NASDAQ

for ease of reading, i have attached 1 year and 3 month charts in each instance

As far as I am aware, naked shorting is an acceptable practise in the U.K.

A Little bit of humour

Two young ladies go for a stroll in the forest and come across a frog

Frog - 'hello young ladies I know i look like a frog but I am really an investment banker and if you kiss me i will turn back into one'

Lady one - bends down picks up the frog but rather than kiss it puts it in her bag and walks off

Lady two - 'why did you put the frog in your bag - if you kiss him he will turn into an investment banker'

Lady 1 - ' dont be silly in todays market he is far more valuable as a talking frog'

Ho ho. Thanks Harry.

ps Selftrade has just come back on-line. Cost me 100 though as my profit in a cy has now almost disappeared so I'm well P**ed off!

Go up in the hills for a few hours and come back to carnage market neutral pairs trading is the only way to go if away from the screen

I'm starting to wonder whether we are heading into a capitulation of share prices.

20%-30%-40% down.

If stop losses are continually triggered ..

IMO

i think shorts are trying to have there last bit of fun before the new naked shorting rules come into effect tonight. Probably not the best day to be long DOW and leave open and go the bed but only 40 pts down and the down is down 300 so ill take the chance.

Which just goes to show that self-regulation hasn't worked:
"Sept. 17 (Bloomberg) -- The U.S. Securities and Exchange Commission stiffened rules against manipulative short-selling after a market rout pushed American International Group Inc. to the brink of collapse and triggered Lehman Brothers Holdings Inc.'s bankruptcy.

The SEC adopted two regulations today forcing traders and brokers to close out short sales on all stocks, amid concern investors are driving down prices by flooding markets with sell orders. A third rule makes it a securities fraud when sellers deceive brokers about delivering borrowed shares to buyers.

Lawmakers and regulators are questioning whether short sellers have contributed to a crisis by spreading false information and using abusive tactics to attack companies. Hedge funds and other investors argue that poor business strategies are to blame, not short sellers.

In traditional short sales, traders borrow shares that they then sell. If the price drops, they profit by buying back the stock, repaying the loan and pocketing the difference.

The SEC rules approved today target so-called naked short- selling, in which traders never borrow shares from their brokers. The agency is concerned that such a strategy can free investors to manipulate prices by placing unlimited sell orders.

``If you want to short the stock you're going to have to deliver it, and the only way to really do that is to pre- borrow,'' Nelson said. `Professional traders are not in the business of taking that kind of risk. They would be very reluctant to face the five-day window because buy-in can be very expensive.''

A second SEC rule imposes penalties on brokers if their clients haven't delivered shares to buyers three days after a short sale. For the specific security that hasn't been delivered, the mandate restricts brokers from conducting additional short sales on behalf of all their customers. The SEC will seek public comment on the change for 30 days.

The SEC also approved a rule drafted in March that would make it a fraud for investors to lie to their broker about locating shares to sell short. Currently, brokers are able to rely on their customers' assurance that they had located shares that could be used to cover a short sale. "

It would appear so much more common place nowadays for shorting that it may well make this bear market last considerably shorter term than any previous - also more vicious...

I don't think this will be a normal bear market, and it'll certainly be vicious. Watch for support at key levels, around 4300 ish for the FTSE, and around 9800 ish for the DOW. If it's fear and greed then these levels should hold and create a platform for a market rally. Of course if it turns out that Lehman was actually too big to fail, maybe we'll just keep falling, and we can say we've seen a piece of history.

In my opinion....

Strawbs

Well it certainly fell a lot further today than I had anticipated this morning - glad I didn't dare leave a position open while I was out all day!

both Dow and FTSE (in particular) have been all over the place

Fear and greed does that, and judging by the gold price, there's plenty of fear out there......

In my opinion

Strawbs.

Interesting article in the independent about the most successful hedge fund managers. They all seem to have started their own businesses and are earning millions each year, mostly by shorting banks. I can't believe that the FSA and government stands impotent whilst they bring the economy, financial institutions and banks down. Most people lose out by it (how many sleeping shareholders are there). Whilst I appreciate going short has been a justifiably trading strategy, these are one-in-a-lifetime events and for me there should be a temporary ban on all shorts whilst the market stabilises. There is no excuse for deliberately bringing a company down that probably would have survived without their efforts.

Christ they may have pots of money but to have the ethics of an alley cat. At least I perceive myself as a decent human being. Rich they may be but what a sad bunch of tossers they are.

Whilst I sort of agree, without short sellers nobody would have any reason to buy when a price was falling rapidly. The short sellers may accelerate the initial moves, but I suspect they also slow the crash because they have to close their position. If the market had no shorting then the ups would be much faster (no resistance), and I suspect the downs more significant. I believe (could be wrong) that you can't short the Chinese market, and look how much money people made and lost in that bubble.

In my opinion.

Strawbs.

Hedge funds attacking US financial institutions is similar to someone up a tree chainsawing branches off like a whirling dervish , sooner or later they will cut off the branch they are standing on... at least I would hope so

Much more honest though Strawbs and companies live and die by their policies.

One of the problems I feel is the hedge funds have got the market to themselves atm. They have effectively taken over as most shares are not traded any more. Greater volume across the market would dilute their effect.

Hegde funds rise and fall in these markets just the same as the rest of us. Bet a few of them got burned by the HBOS bailout. Once the dust settles I dare say the regulators will start to tighten the rules up. Only time will tell if that ultimately has a good or bad impact.

In my opinion

Strawbs.

They can really move markets especially when markets are thin on volume and there is a lot of fear. Slightly worrying is that they pay major contributions into party funds on both sides of the Atlantic and we know how well oil and defense has done under George W's tenure!

Tis interesting in that for the first day I can remember in a long time, banks and miners have both gone up.

Probably just oversold in the last few days. My guess would be that shorters are covering positions and bargain hunters are dipping a tow in the water. Don't be surprised if this relative calm is short lived though. I'd expect the next drop to be bigger and quicker. The "oh my God" moment that clears the market ready for some kind of recovery.

In my opinion.

Strawbs.