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

So, having seen the You-Tube clip, the theory is that the big guys with b's will borrow the stock in huge quanties, short it until the company (Bank) is on it's knees & then buy the stock at a rock bottom price, supported by the fact that the Government will not allow a bank to go under. Is that good enough reason to ban shorting financials for good? I seem to remember the arguement that shorters themselves can't drive a share price down, but that fundamentals in the company must be a contributing factor, such as mega writeoffs & profit warnings.
Just glad I don't have any bank stocks myself, as nationalisation is looking likely, imo.

HC
its not the borrowing and shorting thats the problem. i read somewhere a while back that its naked shorting thats happening, apparantly thats not supposed to happen. but some brokers it was claimed lend out "the same stock" to more than one client. clearly fundamentals do play a part thats why they pick on the weaker companies. dont know if its true but might explain a thing or two. as a major shareholder would you knowingly lend out your stock to shorters?
so whos doing all the lending?
regards
jkd

Worked out very well for Porsche they made 6 billion from doing it!

F
hi, you are so right.
but doing what exactly?
remind me, what was it that they did? i can't remember the exact details, must be getting old.
did they lend out their stock many times over? were they aware of it? as i recall it was a tightly held stock, just the type for what may have been in olden days called a "corner".
thanks and regards
jkd

F -:)
it occurs to me that they didnt lend their stock many times over, but being tightly
held what they did do was lend the remaining "free floating" stock many times over,( well within the overall share issue,) and it was this that wasnt sufficient to satisfy the covering.
when i mentioned major shareholder previously i was thinking along the lines of say 3% for a major institution in say a ftse 100/250 company. that leaves quite a lot of "free issue" and public participation. it seems it was mostly hedge funds who got caught for most of the porsche debacle. LOL
thats a one off, usually its us pi's.
its still happening.
regards
jkd

http://radian.org/notebook/porsche
They built a controlling stake 43% stock/32% options leaving 6% available to trade not requiring to disclose it producing a very crowded exit!

DOW futures currently -77 which doesn't bode well for our 'Obama bounce'.

stopped out my short on ftse I took out at begining of month, could be a bounce but i don't think it'll clear 4300, I expect it to test lows in the next month as the deteriation in economic data accelerates.
The bad news this week will really hit home hard on consumer confidence this month as it did in October, I expect Feb will be a truely dreadful month for any retail business, (unfortunately mine is vulnerable to this downturn in confidence) job losses will be counted in from after Xmas and those credit card bills will hit. All told bloody crap for the next 1/4, I am finding it hard to imagine a pick up in sentiment before the third 1/4 and am only really interested in going long when we hit 3200, probably around April at a complete guess. If I get it wrong great as far as the future of us all is concerned, if not even better.

I'm looking for somewhere around 2500 for the FTSE before I commit any significant funds on the long side. Seemed crazy when I mentioned it over a year ago, seems less crazy by the day. For now I'm avoiding the markets. No time to be risking capital with job security a concern.

Strawbs.

So where do you put your capital in the meantime? Saver's rates are poor, premium bonds a waste of time....etc etc

Only trading very short term now, sometimes only a few hours if price goes my way, and tight stops in place. It's not the way I like trading, but I feel only option in todays market.

Strawbs ....i don't believe you will ever commit .... sorry to say, but you strike me as being like the ex vet girl currently appearing on the traders prog on tv - assume you know what and whom i mean

Seem to be on the precipice, belayed up by IBM after hours, lots of altitude sickness and a desire to go down, Obama failed to turn up with the oxygen

spitfire ... other than inner compulsion, there is no need to trade at all!

No. Actually I don't. I've done pretty well out of stocks on two occasions in the last fifteen years, being invested for periods of around four years throughout the tech boom and the commodities boom. Rest assurred I'll be back when prices are right, but at the moment markets are a gamblers den and I'm not a gambler. If you have the time and spare capital to gamble then I dare say you can make money. I have neither, and prefer to be a patient if perhaps boring investor.

Strawbs.

cynic - which is why apart from a few trades I have mainly only traded indices for the last year.

Glad I stopped out, rebounded a bit today, Obama bounce or short positions being closed, either way bears have had a good run. Gold juniors in or about to be in production looking good to me now. CEY are going cheap as are HGM.

Gold to me looks like it is forming higher lows each time, if it fails to go below $800 in next month looks set for next phase up, government bonds are starting to lose their lustre as concerns over debt pile up, add in weakening currencies and the only way is up it would seem, unless deflation really is here to stay, but surely there will be alot of money flowing into the yellow metal soon.

The classic safe haven hasn't really taken off in dollar terms but for sterling holders it's been a beauty, sp's of juniors not reflected that this week.

As if things weren't difficult enough we will now have to sidestep co's likely to have rights issues, just a few I think may tap shareholders :- PRU, SL. KGF, GKN, RIO and TOMK aimo of course. Can anyone add possible candidates to my list.
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Are you sure about PRU? Broker upgraded it today to buy from hold. No mention of fund raising (though I know they are bidding for some of the AIG assets).

HC ---I don't know that any of my list will tap s/holders it's just my opinion.
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