We have lots of experienced traders on MoneyAM who would be glad to help if you have any trading questions.

richstuch
Ex Dividend
Use Legal & General's as an example. The share price was 74p paying a 3.25p dividend. Now that was approximately 5% so how can we take advantage of it?
Well the plan is to BUY them before market close on Tuesday and hold them overnight. If you do this through a conventional broker you will get the dividend paid into your account. If you do this on CFD you wil have to check what percentage of the dividend they pay. Usually about 95%
Now as that dividend is paid from LGEN the opening price on Wednesday morning should be 70.75p (74p - 3.25p) to reflect the dividend paid out and consequently the reduction in value of the company.
However often you can get out at a better price next morning as many people have not got a clue they are ex divi. Also it is in the interests of certain organisations with large holdings to try and keep the share price from falling as much as possible.
So if you can close next morning near to the previous nights closing value you keep the 5%. As long as the market itself is not to strong you can alternatively reverse your position and go short knowing they should be 5% lower,

Note: If you are short on the stock on Tuesday night as Gausie says above you pay the dividend! So you should always check this if you keep positions open overnight.

Another interesting point is that the dividend payout affects the technical analysis & sentiment on that share and a 5% drop can often trigger a sell signal. Perhaps dropping it through a support or completing a 123 sell pattern.

Croc

I'm suprised to hear that some CFD firms pay less than 100% of the dividend.
If they only pay say 95% then do you know if they only charge you 95% if you are short at the ex-div date?

If that is true then there is a potential arbitrage opportunity by going long with a 100% broker and short with a 95% broker as the share goes exdiv. :-)

thanks to Croc, Gausie and Seymour for that information

Hamsa, you are making the same mistakes all new traders do, you must learn correct position size , discipline, and always stop loss when you are wrong, (easyer said than done )

a couple of good books that will help you are,

1/ alexander elder - trading for a living & come into my trading room

2/ tony oz - how i take money from wall street & stock market wizard ( if you can find it )

both of the above authors are actual day traders, the books are easy to follow and understand, they cover the importance of correct money management, discipline, trading rules,

you might have to go to www.tonyoz.com for his books or you see them regularly on ebay just type in the authors name in search,

ttt

I've just read the post about the witching hour tommorrow and was considering setting a buy limit on a FTSE 100 share. For example setting a buy limit at 5% below the current bid price for, say, TESCO or SHEL or BP or LLOY.
I was wondering what people think is the best one to go for.

M5Martin
I go for AZN, Logica, Barclays, Diageo, Cadbury, III
A nice mix

M5-SGE and AVZ imho!

buy : jarvis hotels at 150p or below
epic code: jvh
bid/offer: 138/142
stop loss: 120
target price: 181
limit buy at: 150
sector: leisure
market cap:147million

I hope this helps and give me some feedback and idea trades aswell:
rgds
zarif

Many thanks to all for the advice. Closed deal and took losses. Should have bought some as they have risen really well. Perhaps will try in double witching tomorrow. 5% below market price? Closed all my positions today and shall try again tomorrow. Once again thank you very much.

Hamsa
Best of luck tomorrow!

This again is an excellent thread..many thanks to Croc, Seymore Clearly, Gausie and others...

Keep up the good work, when I subscribed to this site, wasn't sure if it was worth the money, now I realise have recouped 100x over by learning from each others...

Ta..
Jules99.

Zarif,

I'm not the right person to ask. I'm not a chartist, more of a fundamentalist!

I buy shares as they drop, not as they go up! (My attitude is I've missed the boat, so move onto a share that I haven't!) Also I only use stop loss to lock in profits! If a share is making losses, I normally just stick it out and collect the dividend!

JVH has generally been a pretty boring share. Until this week it rarely did anything! I bought them because I met the Chairman a couple of times when I was doing some voluntary work for The Princes Trust and had some spare cash and thought why not! Not a reason I'd use today!

little woman:
I am a newbie and more often than not take the short position-same as you, Can you give me any links and tips for sites where can get fundamental and chartist advise, I use spreadbetting at present at trade mainly the indexex with occasional shares
good luck for your trading
rgds
zarif

zarif
Check out my site www.ftsedow.com for some general advice sheets on TA.

Thanks croc -ten4

rgds
zarif

Zarif,

Good job u didn't employ your trading strategy to Marconi then :-) !!

Taken and copied from the LSE official site,thought this would be useful to those who were unsure or confused about Trading Terms when a transaction has gone through.....ie AT /Block Trade/Broker to Broker
Well worth a visit to the LSE site... very useful:)

http://www.londonstockexchange.com/default.asp

Regards
Caravaggio



Trade types


Automatic Trade
An automatic trade generated by the system through automatic execution.

Average Price
The transaction was effected at a price based on a volume weighted average price over a given period.

Bargain Conditions Apply
Certain conditions were agreed between the two participants at the time of trading.

Block Trade
The transaction was reported using the block trade facility, which is at least 75 times the NMS for a security with an NMS of 2,000 shares OR above 50 times the NMS for a security with an NMS of 1,000 shares.

Broker To Broker
The transaction was between two member firms where neither firm is registered as a market maker in the security in question and neither is a designated fund manager. Brokers may also apply this indicator when buying or selling domestic equity market securities through a broker, which is not a member firm.

Contra Trade
The trade was reported for a transaction previously automatically executed through the order book.

Correction
This covers any corrections made to trade reports.

Cross
The transaction was effected as an agency cross or a riskless principle trade between two member firms at the same price and on the same terms.

Currency Conversion
The trade was executed in one currency but converted for trade reporting.

Late Reported Trade
The transaction was not reported in accordance with the Exchange's rules on trade reporting.

Market Maker To Market Maker
The transaction was between two market makers registered in the security in question. This may also include those executed through an inter-dealer broker or a public display system.

Non-Risk Trade
These trades are the same as Ordinary trades but specifically for SEATS based segments only (i.e. SEQ1, AIM, SEAT).

Non-Protected Portfolio
The transaction was reported as a non-protected portfolio transaction or a fully disclosed portfolio transaction.

Ordinary
The transaction was not covered by any of the other trade types listed.

Overnight Trade
The transaction was reported after 17:15pm and before 07:15am the following day.

Protected Portfolio
The transaction was reported as a protected portfolio or, was as a result of a worked principle agreement for a portfolio transaction.

Protection Applied
The transaction was protected at the time of reporting it.

Result of Exercising Option
The transaction was reported as a result of exercising a traditional option or a negotiated option.

Result of Stock Swap
The transaction was reported as a result of a stock swap or stock switch (one report is required for each line of stock swapped or switched).

Risk Trade
The transaction was reported by a market maker registered in either a SEATS security, an AIM security or a covered warrant market security.

Riskless Principle
The trade was reported as a riskless principle transaction between two non-members, where the two transactions are executed at different prices or on different terms (requiring two separate trade reports). OR a market maker is reporting a riskless principle transaction where the two transactions are executed at different prices.

SEAQ Trade
This is used for the single uncrossing trade, detailing the total executed volume and uncrossing price as a result of a SEAQ auction.

Single Protected Trade
The trade was reported as a result of a single protected transaction.

Uncrossing Trade
This is used for the single uncrossing trade, detailing the total executed volume and uncrossing price as a result of a SETS auction

Worked Principle Trade
The reported trade was from a worked principle agreement for a single security.

If everyone's run out of good questions to put, I can think of a good one:
It's often said that indicators such as MACD, directional movement, oscillators etc are a waste of time. Is this right? How about if you combine them? Or if, instead of using them to generate signals, you use them to confirm that you are on the right side of the market? How about moving averages? All lagging indicators, I know, but are they really of no value at all? If so, it's funny that 'wise' people always recommend reading books such as Elder or Pring or the daddy of them all, Murphy, all of which include the use of indicators as part of a balanced trading strategy!
ZOLTAR

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