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

Im neutral, but cant really see 3000 or under, prices just get too cheap...

All relative. If nobody has any money then people will only buy if prices are cheap (affordable). Works for equities just like houses, commodities, everything really. Asset prices tend to rise when people are flush with cash, and fall when they're skint. Logic tends to have little to do with it, and cheap is only relative to previous prices, not necessarily market conditions. All balances out eventualy though, even if it overshoots for years in one direction or another.

In my opinion.

Strawbs.

It is interesting to hear investment gurus talking more about companies paying dividends rather than potential capital gain, times are changing,perhaps we are going back to the days when only companies paying dividends had high ratings rather the "pie in the sky" ratings we have seen in the past decade.

From FT via trader tom
VW vies for title of worlds biggest company
By Richard Milne in London
Published: October 28 2008 09:34 | Last updated: October 28 2008 11:02
Volkswagen briefly became the worlds largest company by market capitalisation on Tuesday as panic-buying by hedge funds desperate to cover losses caused its value to shoot up by up to 150bn.

Shares in Europes largest carmaker soared as high as 1,005 in early trading, having closed at about 210 on Friday. That gave it a market capitalisation of around 296bn ($369bn), higher than that of ExxonMobil, the oil company that closed on Monday with a value of $343bn.

what a loony market .... Dow currently +800 at 8890 ...... surely to goodness this has to be far far too far too fast, with reality coming back to haunt when Fed announces the actual rate cut.

quite incredible .... as we get to the bell, Dow is up just over 1000 from it's low point o'night

Well I said I thought we were near a bottom... LOL.

You're quite right of course, the market often prefers to travel than arrive. At the moment everyone is travelling and leaving together though. I suspect this sort of behaviour can't be sustained for much longer. I doubt even the market professionals have a clue what's going on. Super volatility will no doubt make the patient very sick eventually......

In my opinion...

Strawbs

I'm sure you are right that the market professionals haven't a clue to what is happening, I just hope that not too many people were caught short today, this sort of market can wipe out an investor.

Time for caution now with reduced stakes, and sensible stops.

I was looking at blogs on another site, with some people placing ftse position from 50 to 200 a point if that can be believed, total madness if true.

That's a big jump! Jap and US rate cuts +megga short squeeze+pres election+seasonals,missed out on it but stopped out my ftse short thankfully at 3980. Buy on rumour sell on fact? Presumably 730 tonight will be US decision. Cable has reversed a fair bit I'm tempted to go long oil for some reason, US stockpiles out today certainly noticed people being more enthusiastic at the pumps though industrial usage must have dropped a lot, hope you were on the Dow train yesterday ahoj

i quite bravely went short Dow just after the bell last night, albeit with stops in place ...... imo, that rise was almost more crazy and overdone than some of the collapses we have recently seen .... i would expect Dow to fall at least 200 points today and maybe a lot more after the Fed announcement, though for sure a drop in rates will be forthcoming

How about this pairs trade long wti oil at $62, short Jonathon Ross? The latter has got a huge market cap, but might want to be disposed of by massive conglomerate after putting foot in it again!

Once upon a time you needed skill and a bit of luck to pick good shares. Now it seems you need luck and a bit of skill. :-) I dare say speculators will be wiped out eventually. Huge swings overnight (even during the day) could easily destroy margined positions. The sooner the better really. It might be the only way markets settle down. My guess is cable will reverse once we drop rates by 1/2 %. The dollar will strengthen again and that should have a negative effect on oil, gold etc. I'd be surprised if dollar strength lasts beyond 2010 though....

In my opinion...

Strawbs.

2010 is a ludicrously long timescale to be looking at for currency .... while it is interesting to note that the sogenannte experts have cable anywhere between 1.40 and 1.89 by end this year, my guess (hope) is for somewhere around 1.65 or north of that ...... in fact, such have been the gyrations of cable, that our company will be switching to accounting in $ before y/e, thus eliminating most of the preposteros forex swings that we currently have

I have no specific timescale or interest (per say) in cable. I just feel whilst it may be a "safe haven" for now, the US must surely be a basket case with all that debt once the immediate "crisis" abates. I figure we could see another year or so of uncertainty though.

Seperately. Given GDP figures are out in the US on Thursday, will the size (or maybe lack) of any Fed rate cut give some clue as to how good or bad the GDP figures are likely to be?

Strawbs.

doubt it ..... GDP numbers are historic and surely bound to be vile ..... Fed rate cut is an attempt to kick start the economy by giving Joe Public encouragement to go out spending a bit more and, if the banks (ever) get round to reducing their own lending rates, it will also be good for biz

Banks generally prefer to look after no 1 than reducing lending rates...
Congress was told that if they attempted to restrict the use of the funds you would veto the bill.

We the people, in our phone calls, letters and faxes both to you and to Congress, said that we disapproved - that Hank Paulson would abuse this power and the banks would abuse our (not your) money.

Paulson in fact did exactly that.

He gave out $125 billion of that money in the form of "equity injections" to these banks without requiring in the form of contact that:

They not pay out any of it in bonuses, dividends, or executive compensation.
That they not use it to acquire other companies.
That they agree to verifiable means of showing that they have used it to make loans into the economy.
The banks in fact are using the money for bonuses and acquisitions, and aren't making loans - exactly as we the people said would happen, and which your political appointee enabled through his explicit actions.

At least ftse hasn't gone mad today after dow increased nearly 10%, the markets are acting like a manic depressive now, which doesn't make it easy for trend traders.

I bet some banks are feeling sickened today after the incredible short squeeze of Volkswagen on Monday and Tuesday, after covering positions yesterday after huge gains, Volkswagen are down today over 40%. Sounds like some manipulation here.

not exactly ..... many big shorts in VW had to be covered in a hurry and insufficient stock around to do so ...... interestingly, one could not short VW either when it was +/-1000!

As from 3i site , well worth a watch, interesting prediction of $ being next carry trade
http://uk.youtube.com/watch?v=OUixPvfJHB8

Wall St is presently being run by folks from the lunatic asylum who call themselves "Hedge Fund Managers"