Investing in ETFs made simple 101Hello,
Investing in Exchange-Traded Funds (ETFs) can be challenging, especially for beginners who may struggle with selecting the right funds, understanding market trends, and managing risks. With thousands of ETFs available, covering various asset classes, sectors, and investment strategies, it can be overwhelming to determine which ones align with your financial goals. Factors such as expense ratios, liquidity, underlying assets, and market conditions all play a crucial role in making an informed decision.
To simplify this process, we have carefully analyzed and selected a number of ETFs that we believe offer strong potential for growth, diversification, and long-term value. Below, we highlight these ETFs and explain why they could be good investment choices.
ISHARES CORE S&P 500 UCITS ETF U.S. DOLLAR - ISHARES VII PLC
FUND OVERVIEW
The Fund seeks to track the performance of an index composed of 500 large cap U.S. companies.
• Asset Class: Equity (Focused on large caps)
• Accumulation ETF
• Unit price: $643.82
• Benchmark: S&P 500
• Expense ratio: 0.07
Top 10 holdings
• Apple: 7.59%
• Nvidia Corp: 6.61%
• Microsoft Corp: 6.29%
• Amazon Inc.: 4.12%
• Meta platforms: 2.56%
• Tesla: 2.26%
• Alphabet: 2.22%
• Broadcom Inc.: 2.17%
• Alphabet Inc: 1.82%
• Berkshire Hathaway Inc.: 1.67%
Why we think this is a good ETF to have
The iShares Core S&P 500 UCITS ETF (Acc) offers investors a cost-effective way to gain exposure to the 500 largest U.S. companies across various sectors. As a passively managed fund, it seeks to replicate the performance of the S&P 500 Index, making it an excellent choice for those looking for broad market diversification. Having an accumulating structure, dividends are reinvested, maximizing long-term returns through compounding. The fund is managed by Blackrock and is domiciled in Ireland.
SPDR MSCI WORLD COMMUNICATION SERVICES UCITS UCITS ETF USD Acc
Fund Objective
The investment objective of the Fund is to track the performance of companies in the Communication Services sector, across developed markets globally. The MSCI World Communication Services 35/20 Capped Index measures the performance of global equities that are classified as falling within the Communication Services sector, as per the Global Industry Classification Standard (GICS).
• Investment Manager: State Street Global Advisors Europe Limited
• Asset Class: Equity (Focused on companies in the Communication Services sector)
• Accumulation ETF
• Unit price: $67.15
• Benchmark: MSCI World Communication Services 35/20 Capped Index
• Expense ratio:
Top 10 holdings
• Meta Platforms Inc-Class A 18.58
• Alphabet Inc-Cl A 18.30
• Alphabet Inc-Cl C 15.80
• Netflix Inc 7.81
• Walt Disney Co/The 4.11
• Verizon Communications Inc 3.43
• At&T Inc 3.33
• Comcast Corp-Class A 2.96
• T-Mobile Us Inc 2.36
• Deutsche Telekom Ag-Reg 2.13
Fund performance
Why we think this is a good ETF to have
The technology, media, and communications sector is likely to benefit significantly under a Trump presidency. While the tech industry has faced antitrust scrutiny in recent years, Trump has largely ignored or downplayed these cases. His reluctance to support antitrust actions against media giants has indirectly favored them and is expected to continue doing so. During Trump’s inauguration, top tech CEOs were given VIP seats ahead of even some cabinet members, signaling his close ties to the industry. Additionally, Trump owns his own social media platform, "Truth Social," while his close ally, Elon Musk, owns "X." Any restrictive regulations imposed on the sector would directly impact these platforms, making it less likely that heavy-handed policies will be introduced.
A day after his inauguration, Trump announced a major initiative to expand artificial intelligence infrastructure in the U.S., calling it the largest buildout of its kind in history. These factors collectively suggest strong growth prospects for the tech sector under his leadership. Given this favorable outlook, we see an opportunity to invest in an ETF with significant exposure to this sector.
ISHARES GLOBAL HEALTHCARE ETF
Investment objective
The iShares Global Healthcare ETF seeks to track the investment results of an index composed of global equities in the healthcare sector.
• Asset Class: Equity (Focused on the healthcare sector)
• Unit price: $92.57
• Benchmark: S&P Global 1200 Healthcare Sector Index
• Expense ratio: 0.41%
Top holdings
• Eli Lilly- 8.72%
• United Health group Inc- 6.68%
• Johnson & Johnson- 4.74%
• AbbVie Inc- 4.51%
• Novo Nordisk- 3.88%
• Merck & co Inc- 3.61%
• AstraZeneca PLC- 2.92%
• Thermo Fisher scientific Inc- 2.86%
• Roche holding par AG- 2.84%
• Abbott laboratories- 2.82%
Why we think this is a good ETF to have
Investing in a healthcare ETF right now could be especially promising given the anticipated direction of U.S. healthcare policy under President Donald Trump. The administration is expected to stick to its strong deregulation agenda while keeping healthcare access and cost management at the forefront. Looking ahead, the Trump administration intends to uphold campaign promises for the health sector with four key themes: Promote access to healthcare via market competition and transparency, enhance flexibility and choice in healthcare to states and individuals, focus on deregulation by reversing or modifying Biden-era policies and Enhance national security with “America first” principles.
While there is a possibility that efforts to lower drug prices and boost competition might counterbalance some deregulation benefits, the overall push for a more dynamic, less regulated market suggests significant upside potential. For investors, this means your healthcare ETF could stand to gain from a regulatory environment that encourages innovation, speeds up market entry for new products, and drives overall industry growth. We see an opportunity to tap into a changing regulatory landscape with high potential for growth and innovation through investing in the Ishares Global Healthcare ETF.
VANGUARD FINANCIALS ETF
Investment Objective
The fund seeks to track the performance of the MSCI US Investable Market Index (IMI)/Financials 25/50, investing in multi-cap equity within the financials sector. It is passively managed, employing a full-replication strategy when possible, but resorts to a sampling approach if regulatory constraints arise to maintain the index’s key characteristics. The fund remains fully invested, with low expenses helping to minimize net tracking error.
Asset Class: Equity (Focused on the US financial sector)
Unit price: $126.28
Benchmark: MSCI US Investable Market Index (IMI)/Financials 25/50
Expense ratio: 0.10%
Dividend schedule: Quarterly
Ten largest holdings
JPMorgan Chase & Co. 8.7 %
Berkshire Hathaway Inc. 7.7 %
Mastercard Inc. 5.5 %
Visa Inc. 4.8 %
Bank of America Corp. 3.9 %
Wells Fargo & Co. 3.1 %
Goldman Sachs Group Inc. 2.3 %
American Express Co. 2.2 %
S&P Global Inc. 2.0 %
Morgan Stanley 1.9 %
PERFORMANCE
Why we think this is a good ETF to have
Optimism is building for more deal making in a Trump presidency, with activity showing signs of life. After a relatively low year in global mergers & acquisitions in 2023, 2024 witnessed a moderate uptick as the pandemic receded further into the rear-view mirror, the U.S. economy stabilized, inflation declined, financing markets brightened, albeit modestly, and equity markets climbed ever higher. While the business grew in 2024, heightened regulatory enforcement, among other factors, led to fewer very large transactions. The return of President-elect Donald Trump to the White House, with the Republican party having majorities in both houses of the U.S. Congress, is expected to bring a more business-friendly, deregulatory approach to policymaking, and further solidifies widespread expectations among market participants that M&A activity will increase in 2025. The Vanguard Financials ETF gives you exposure to the financial sector at a low cost. Given the above, we see opportunity in owning the ETF.
All the above information has been compiled from
ETF screener: in.tradingview.com
ETF news: in.tradingview.com & in.tradingview.com
ETF ideas: in.tradingview.com
Good luck
Community ideas
What Is NON-FARM PAYROLL (NFP) ?Non-Farm Payroll (NFP)
The Non-Farm Payroll (NFP) is a crucial U.S. economic indicator that tracks changes in the total number of paid workers, excluding farm workers, federal employees, private household workers, and nonprofit staff. It is released on the first Friday of every month and significantly impacts the forex market due to its implications for economic growth and inflation.
________________________________________
Key Points:
What is NFP?
Tracks the total number of paid workers in the U.S., excluding certain sectors (e.g., farms, government, private households, nonprofits).
Indicates labor market health and economic trends.
⚠️Release Schedule:
Published on the first Friday of each month .
Provides monthly updates on U.S. employment changes.
📊Market Impact:
Causes significant rate movements in the Forex Market.
Anticipated by traders, analysts, and investors for market forecasting.
📊Economic Implications:
Increasing NFP Numbers:
Signals economic growth and currency value appreciation.
Can raise concerns about inflation risks.
Decreasing NFP Numbers:
⚠️Indicates potential economic slowdown or broader issues.
NFP serves as a barometer for the U.S. economy and is closely monitored for decision-making in financial markets. 📊
🔥 How Many Moment Expected in Gold : 160-200 PIPS
📚 Learn more about trading strategies and market insights!
💡 Follow for more educational content to boost your trading knowledge. 🚀
Rakesh Jhunjhunwala’s Legendary Stock Picks & Investing Secrets!Rakesh Jhunjhunwala: The Big Bull of Indian Stock Market
Hello everyone! I hope you all are doing great in life and in your trading journey. Today, I bring you an educational post on Rakesh Jhunjhunwala, one of India’s most legendary investors, often referred to as the Big Bull of the Indian Stock Market. His journey from ₹5,000 to billions is an inspiration to every trader and investor.
Starting his journey in 1985, Jhunjhunwala believed in the power of long-term investing, market cycles, and the Indian growth story. He had an exceptional ability to identify undervalued stocks and patiently hold onto them for years, turning them into multi-bagger investments.
Rakesh Jhunjhunwala’s Iconic Stock Picks
✔ Titan (TITAN): Bought at ₹3 per share, it became one of his biggest success stories, skyrocketing to ₹3,000+ over the years.
✔ Lupin (LUPIN): Entered the stock early and gained massive returns as India's pharmaceutical sector expanded.
✔ CRISIL: One of his early investments, where he foresaw India's growing need for credit rating services.
✔ Sesa Goa (Vedanta): A strategic metals & mining investment that paid off well over time.
✔ Nazara Technologies: His bet on India’s booming digital gaming industry.
Rakesh Jhunjhunwala’s Key Investing Principles
Conviction is Key: Jhunjhunwala always invested with strong conviction, backing companies with solid fundamentals and growth potential.
Long-Term Wealth Creation: He believed in holding quality stocks for years rather than looking for quick profits.
Market Cycles Matter: Understanding bull and bear phases is essential for maximizing gains and managing risk.
Buy When Others Fear: He followed a contrarian approach, buying when others were selling in panic and exiting when the market was euphoric.
Focus on Fundamentals: His investments were based on strong financials, management quality, and business scalability.
Risk Management is Crucial: Even as a billionaire investor, he believed in managing risks and diversifying investments.
What This Means for Traders & Investors:
By following Jhunjhunwala’s principles, traders and investors can develop patience, identify strong companies, and ride long-term market trends with confidence.
Outcome:
Applying these lessons can help traders and investors build a disciplined, well-researched, and profitable investment approach.
What’s your biggest learning from Rakesh Jhunjhunwala’s investing journey? Share your thoughts in the comments!
Use of Macd in trading (basic-to-advance)Moving average convergence/divergence (MACD) is a technical indicator to help investors identify entry points for buying or selling. The MACD line is calculated by subtracting the 26-period exponential moving average (EMA) from the 12-period EMA. The signal line is a nine-period EMA of the MACD line.
The standard and most widely used settings for the MACD Indicator are 12, 26, and 9. These represent the 12-day EMA (fast line), the 26-day EMA (slow line), and the 9-day EMA (signal line). However, some traders adjust these to shorter periods (like 8, 17, and 9) for day trading to capture faster market movements
Divergence Based TradingDivergence is when the asset price moves in the direction opposite to what a technical indicator indicates. When a stock is diverging, it signals weaker price trends and the beginning of a reversal. The two types of divergence are: Positive: A positive divergence is a sign of higher price movement in the asset.
Divergence signals tend to be more accurate on the longer time frames. You get fewer false signals. This means fewer trades but if you structure your trade well, then your profit potential can be huge. Divergences on shorter time frames will occur more frequently but are less reliable.
Divergences are a powerful trading concept and the trader who understands how to trade divergences in the right market context with the correct signals can create a robust method and effective way of looking at price.
10 tricks for developing discipline or here was WarrenIf you asked me, what is the most valuable trait an investor should have, I would call it the ability to follow your own rules. In other words, it is discipline. A novice investor can learn quickly, know all the features of the chosen strategy from A to Z, but it is unlikely that he will succeed without this trait. So, Warren Buffett called persistence your engine, and discipline the guarantee of a successful future.
Imagine that you have sailed to an unusually beautiful island with the goal of finding a treasure chest. To achieve this, you have a map with a description of all the paths and turns that you need to take to reach your goal. However, after the first 100 meters of the path you understand that this island has a huge number of amazing plants, ripe fruits, and curious animals. All this is very interesting and attractive for you: firstly, you want to take a photo of a beautiful flower, secondly, try a tropical fruit, thirdly, play with a funny monkey. “Why not? This is a great chance!” you think. After a while, having enjoyed the life of the island, you realize that it is already evening, and it is easier to spend the night somewhere under a palm tree and continue the search for treasure tomorrow, during daylight hours. “That’s a smart idea!” you note and begin to prepare a place to sleep.
In the morning, you wake up in a good mood, you are greeted by familiar flowers, fruits and a cheerful parrot. Since you already know all this, you decide to continue following the map to find the treasure today and sail on. The path is easy for you: the entire route is marked in advance, you just follow these instructions. So, here you are. At the roots of the largest palm tree, under many branches, there should be a treasure chest hidden. You clear away the branches, and here your expectation collides with a shocking reality. Instead of a chest, you see a hole, where at the bottom, with a wooden stick, is written: “Warren was here”.
In this example, Warren had the same map as you. Moreover, he arrived on the island much later. The only difference is his model of achieving the goal. He understood that exploring the island was not a priority for him right now. Warren would be happy to return there, but this time with the goal of relaxing, perhaps on his brand-new ship. And while he came to the island to look for treasure, he is looking for it. Everything else, despite all its attractiveness, is for him a risk of not achieving the goal.
I also think of my stock investing strategy as a map that helps me understand where I should turn in any given situation. The only thing that makes me follow the route is discipline. Unfortunately, I can't put the stock market on pause or ignore corporate news - they all require my attention. If I choose this path, I follow it. In other words, if I am not going to follow the recommendations of my map, then why did I choose this path?
However, how difficult it is to look calmly at temptations. A man is not a robot. So we need some tricks that can help us with discipline. I think that in this regard, the most brilliant invention of mankind was and remains the alarm clock. No matter how much we sleep, when the alarm rings, we wake up. The most disciplined people even set several alarms to make sure they wake up! On the one hand, it irritates us like crazy, on the other hand, have you ever thought about how well it helps us relax? After all, there is no longer a need to wake up and determine the time by the brightness of the sun from the window - now we have an alarm clock! It turns out that discipline can be associated with pleasant things.
By the way, on TradingView, such a brilliant invention is “Alerts”. I wrote about this function in the article: “A pill for missed opportunities” . I will only add that the alert system can be applied not only to the stock price, but also to the indicators that you use on the chart, as well as to a whole watch list. So, make a list of companies you want to keep an eye on. Then set alerts when a certain condition related to price or indicator value is reached. And finally, wait calmly. Yes, this is what will take up all your time - waiting. And believe me, it takes a lot of discipline to just wait.
To develop this trait, I recommend creating habits that are organically linked to your strategy. For example, to decide about a deal, I constantly refer to news about the selected companies. It is significant for me to understand whether critical events have arisen that could influence my decision to open or close a position. However, regularly reading corporate news can hardly be called a fascinating activity for everyone. This is not looking at memes at all. Therefore, below I will give a few tricks that will help make this (and not only this) activity systemic:
1. Set your alarm for 1 hour before the stock market opens. Let this signal remind you that it is time to study the news on companies that have already been bought or are very close to being bought.
2. Make access to news as convenient as possible. Install the TradingView app on your phone, tablet, home computer or laptop. Don't have problems accessing information in any situation: if you are lying on the couch, sitting at the table or walking in the park.
3. Start with small steps. For example, start by reading only the headlines of news stories, rather than the entire story at once. Gradually increase the amount of incoming information. In one full hour, you can easily gather all the information you need to get a complete picture before the market opens.
4. Use modern technologies. For example, reading news from your voice assistant. This is convenient if you are on the move.
5. Combine your habit with another direction you are developing. For example, if you are learning a foreign language, practice reading the news in that language.
6. Organize public attention to your habit. For example, agree with your wife that for every time you skip a habit, you take her to a new restaurant (I think the most effective method for married men). Chat with like-minded people and/or post your thoughts on the news on social networks. The extra attention will motivate you to keep doing it.
7. Add a little joy to your news reading habit. If you like freshly squeezed juice, place a glass of it next to you. After the work you've done, be sure to thank yourself. For example, a delicious dessert or watching one episode of your favorite TV series.
8. Formulate your goal as follows: not to be someone who understands everything, but to be someone who never misses a single event.
9. Separately, I would like to draw attention to keeping a diary of your operations. This is an essential document that will help you track your progress - your Track Record. At the same time, it is one of the systemic habits. I recommend adding to Track Record information about cash transactions, trades, taxes, dividends, conditions that prompted you to open or close a position in shares. You can organize such a diary in any spreadsheet to calculate some of the metrics using formulas.
Below, I will present the metrics that I use in my Track Record. All data in it will be provided as an example only.
10. And finally, I think it is significant to visualize your achievements not only in electronic form, but also to have a physical embodiment of your results. For example, these can be empty glass flasks where you can put coins or balls corresponding to certain actions: opening a position, closing a position with a profit, closing a position with a loss, paying dividends. One flask - one year. Such an installation will look beautiful in your room or office and will remind you of what you have finally achieved. You might even have some interesting stories to tell to curious guests who notice this piece of furniture.
How to draw support and resistance?Drawing **support and resistance** levels is a key aspect of technical analysis. These levels represent areas where the price tends to reverse or stall, providing key insights into market behavior. Here's how to draw them in brief:
### 1. **Support**
- **Definition**: A price level where a downtrend is expected to pause or reverse as demand increases. It's the floor of the price action.
- **How to Draw**:
- Look for areas where the price has bounced higher multiple times in the past. These are points where buyers have stepped in.
- Draw a horizontal line at the lowest price points in these areas.
- Strong support is confirmed when the price touches the same level multiple times without breaking it.
### 2. **Resistance**
- **Definition**: A price level where an uptrend is expected to pause or reverse as selling pressure increases. It's the ceiling of the price action.
- **How to Draw**:
- Identify areas where the price has consistently faced downward pressure or reversed. This is where sellers have entered the market.
- Draw a horizontal line at the highest price points in these areas.
- Strong resistance is confirmed when the price fails to break above it multiple times.
### 3. **Key Points to Remember**
- **Multiple Touches**: The more times the price touches a level without breaking through, the stronger the support or resistance.
- **Broken Levels**: Once a support level is broken, it often becomes resistance (and vice versa).
- **Use Trendlines**: In addition to horizontal levels, you can also draw diagonal trendlines to connect higher lows (support) or lower highs (resistance) in trending markets.
These levels help traders anticipate potential price reversals or continuations, making them essential for developing trading strategies.
What is RSI and How it is usefull in trading??The **Relative Strength Index (RSI)** is a momentum oscillator that measures the speed and change of price movements, ranging from 0 to 100. It helps traders identify overbought or oversold conditions:
- **RSI above 70**: Overbought, potential price reversal or pullback.
- **RSI below 30**: Oversold, potential price rebound or reversal.
### Key Uses in Trading:
1. **Overbought/Oversold Conditions**: Buy when RSI is below 30, and sell when above 70.
2. **Divergence**:
- **Bullish Divergence**: Price makes new lows, but RSI makes higher lows (buy signal).
- **Bearish Divergence**: Price makes new highs, but RSI makes lower highs (sell signal).
3. **Trend Confirmation**: RSI above 50 suggests a bullish trend, below 50 indicates a bearish trend.
4. **Entry/Exit Signals**: RSI crossing above 30 (from oversold) can signal a buying opportunity, while crossing below 70 (from overbought) can signal a selling opportunity.
### Best Used With:
- Other indicators (e.g., moving averages, support/resistance) to confirm signals.
RSI helps traders spot potential reversals, confirm trends, and make informed entry/exit decisions.
How to do Database Trading Part 5 ?Database trading, often referred to as *algorithmic trading* or *quantitative trading*, involves using computer algorithms to make automated trading decisions based on a large amount of data. This type of trading is heavily reliant on databases to store, analyze, and retrieve historical data, trading signals, market conditions, and other relevant information for decision-making. Here's a step-by-step breakdown of how to get started:
### 1. **Understand the Basics of Trading**
Before diving into database trading, you should have a good understanding of:
- **Financial Markets:** Understanding how different markets (stocks, forex, crypto, etc.) work.
- **Trading Strategies:** Familiarize yourself with common strategies like trend following, mean reversion, or arbitrage.
- **Technical Indicators:** Learn how technical analysis indicators (moving averages, RSI, MACD) can be used to generate trading signals.
### 2. **Learn About Algorithmic Trading**
- **Quantitative Analysis:** Database trading relies on quantitative analysis, where you analyze large amounts of historical data to find patterns, trends, and correlations that can guide decision-making.
- **Programming Skills:** Most algorithmic trading is done using programming languages such as Python, C++, or Java. Python is especially popular because of its data science libraries (like Pandas, NumPy, and Scikit-learn) and ease of use.
- **Backtesting:** Backtesting is a crucial part of database trading, where you test your algorithm on historical data to see how it would have performed in the past.
### 3. **Setting Up a Database**
- **Data Collection:** You'll need access to a database of historical market data (price, volume, order book, etc.). Common sources include Yahoo Finance, Alpha Vantage, Quandl, or APIs from brokers like Interactive Brokers or Alpaca.
- **Database Management Systems (DBMS):** You can store your data in relational databases like MySQL, PostgreSQL, or use NoSQL databases like MongoDB. It's essential that your database can handle large volumes of data quickly, especially if you're processing real-time data.
- **Data Types:** Store various data types like:
- **Historical Market Data:** This includes open, high, low, close prices, and volume for the assets you wish to trade.
- **Economic Indicators:** Things like interest rates, GDP growth, unemployment rate, etc.
- **Alternative Data:** News sentiment, social media analysis, etc.
### 4. **Data Processing and Analysis**
- **Preprocessing Data:** Clean and organize your data. This step might involve dealing with missing values, outliers, and adjusting for corporate actions (like stock splits).
- **Feature Engineering:** Extract useful features from the raw data that will be used in your trading model. For example, moving averages, RSI, or volatility can be used as features to generate signals.
- **Modeling:** Use statistical or machine learning models to analyze the data and predict future price movements or trends. Common techniques include:
- **Time Series Analysis:** ARIMA, GARCH, etc.
- **Machine Learning:** Linear regression, decision trees, neural networks, etc.
### 5. **Developing the Trading Algorithm**
- **Algorithm Design:** Based on your data and models, design an algorithm that automatically generates trading signals. This might be a simple rule-based system (e.g., buy if the price crosses above the moving average) or a more complex machine learning model.
- **Execution Logic:** Design how your algorithm will execute trades. Some systems are direct market access (DMA), while others might use broker APIs to place orders on the market.
- **Risk Management:** Incorporate risk management techniques like stop-loss, take-profit, and position sizing to protect your portfolio.
### 6. **Backtesting**
- **Simulate Trades:** Before you go live, run your algorithm against historical data to evaluate its performance. Backtesting should be done on out-of-sample data to get a more realistic picture of how the strategy might perform.
- **Metrics:** Use performance metrics such as Sharpe Ratio, Maximum Drawdown, and Win Rate to evaluate the quality of your strategy.
### 7. **Paper Trading**
- **Paper Trading:** This involves running your algorithm on live data, but without real money. It's a crucial step to ensure the algorithm works correctly in a real-time environment and that it can handle market slippage, transaction costs, etc.
### 8. **Deploying to Live Trading**
- **Execution Platform:** Once you're confident your algorithm works, deploy it to a trading platform that supports algorithmic trading. Popular platforms include Interactive Brokers, MetaTrader, QuantConnect, and Alpaca.
- **Monitoring:** Even though the algorithm trades automatically, you must still monitor its performance and intervene in case of unexpected market conditions or errors in the system.
### 9. **Optimization and Maintenance**
- **Continuous Improvement:** Constantly optimize your trading algorithm by refining your model, adjusting risk management rules, and adapting to market changes.
- **Real-time Data:** Stay on top of real-time data and news. For instance, changes in interest rates or earnings reports can heavily impact financial markets.
- **System Maintenance:** Ensure that your database and trading systems are running smoothly, handling failures, and scaling with large amounts of data.
### Tools and Resources:
- **Trading Platforms:** Interactive Brokers, MetaTrader, Alpaca, Tradestation.
- **Data Providers:** Alpha Vantage, Quandl, Yahoo Finance, FRED.
- **Programming Languages:** Python (Pandas, NumPy, scikit-learn, TensorFlow), C++, Java.
- **Databases:** MySQL, PostgreSQL, MongoDB.
- **Backtesting Tools:** Backtrader, Zipline, QuantConnect.
### Key Considerations:
- **Market Risk:** Even the best algorithms can’t predict every market movement. There’s always inherent risk.
- **Data Quality:** Bad data can lead to poor trading outcomes. Ensure your data is clean and accurate.
- **Latency:** In high-frequency trading, speed matters. Having low-latency systems and database access is crucial.
How to use ADX in trading ???The ADX identifies a strong trend when the ADX is over 25 and a weak trend when the ADX is below 20. Crossovers of the -DI and +DI lines can be used to generate trade signals. For example, if the +DI line crosses above the -DI line and the ADX is above 20, or ideally above 25, then that is a potential signal to buy.
The traditional setting for the ADX indicator is 14 time periods, but analysts have commonly used the ADX with settings as low as 7 or as high as 30. Lower settings will make the average directional index respond more quickly to price movement but tend to generate more false signals.
Many trading strategies like Linda Raschke's Holy Grail and Jeff Cooper's 5 Day Momentum Method use the ADX indicator to identify strong trends. However, day trading with the ADX indicator is not common. The reason is while the ADX indicator is good at identifying strong trends, it is a lagging indicator.
Use of exponentional Moving Averages in TradingExponential Moving Average (EMA full form in stock market) is a kind of moving average that places a greater weight and importance on the most current data points. It is used for evaluating the bullish and bearish trends in securities over a certain span of duration.
ow Does the 5-8-13 EMA Crossover Work? The crossover detects momentum shifts, which can hint at significant price moves in the near term. When the 5-EMA crosses above the 8 and 13 EMAs, it suggests a rising bullish momentum. When the opposite happens, it indicates bearish momentum
Experts suggest that using 15-minute EMA is most effective for intraday trades that are carried out during periods of high market volatility. To interpret the 20 EMA, you need to compare it with the prevailing stock price. If the stock price is below the 20 EMA, it signals a possible downtrend.
Option Chain Analysis Option analysis involves studying various parameters like strike prices, premiums, implied volatility, open interest, and time decay. Combining this data with technical and fundamental analysis helps assess potential trade setups and risks.
LTP (Last Traded Price) OI (Open Interest) OI change in percentage. Greeks - Delta, Theta, Gamma, Vega. IV (Implied Volatility)
OI in Option Chain
Higher open interest generally indicates higher liquidity and market activity for that contract. Change in OI: This shows the variation in open interest during a given period, including contracts that have been closed, exercised, or squared off
Technical analysis part 1Technical analysis is a means of examining and predicting price movements in the financial markets, by using historical price charts and market statistics. It is based on the idea that if a trader can identify previous market patterns, they can form a fairly accurate prediction of future price trajectories.
Some traders follow something called the "10 a.m. rule." The stock market opens for trading at 9:30 a.m., and there's often a lot of trading between 9:30 a.m. and 10 a.m. Traders that follow the 10 a.m. rule think a stock's price trajectory is relatively set for the day by the end of that half-hour.
How to perform technical analysis
Identifying the trend. This is the first step in technical analysis for traders because trading strategies can either follow the trend or go against the trend. ...
Drawing support and resistance levels. ...
Establishing entry and exit points. ...
Position sizing and risk management.
Use of RSI in Advance TradingRSI values are typically used to identify overbought and oversold conditions. A reading above 70 suggests that the asset may be overbought and could be due for a downward correction. On the other hand, a reading below 30 indicates that the asset may be oversold, signalling a potential upward reversal.
The best RSI settings are typically a 14-period timeframe with 70 as the overbought level and 30 as the oversold level. These settings can be adjusted based on specific trading strategies.
The RSI provides technical traders with signals about bullish and bearish price momentum, and is often plotted below the graph of an asset's price. An asset is usually considered overbought when the RSI is above 70 and oversold when it is below 30.
Option and Database TradingOption chain analysis is the process of evaluating the information provided in the option chain to identify potential trading opportunities. Traders use option chain analysis to evaluate the market's expectations of an asset's future price movements and make informed decisions about their investments.
The Option Chain is a table that contains the most critical information needed to purchase and sell options. We have previously discussed calls and puts, underlying prices, strike prices, expiration, and moneyness. The option chain is where all of this comes together (just like that map of the metro network).
Option Chain AnalysisOption chain analysis is the process of evaluating the information provided in the option chain to identify potential trading opportunities. Traders use option chain analysis to evaluate the market's expectations of an asset's future price movements and make informed decisions about their investments.
OI stands for Open Interest, which is the total number of outstanding option contracts that have not yet been settled. OI helps to gauge market trends and shows how many options contracts are still open. Higher open interest generally indicates higher liquidity and market activity for that contract.
Use Graphs and Charts: You can plot the option chain data on graphs and charts. It will help understand the trends associated with different components of the option chain. Technical and Fundamental Analysis: Investors must analyse technical factors (associated with price) to make informed decisions.
Option Chain AnalysisUnderstanding Option Chain Analysis
An option chain is a matrix consisting of all available contracts for investors. Option chains are available for individual stocks and market indices like NIFTY 50 and NIFTY 500. You can select a stock or a market index and find all available options through an option chain.
The 9.20 short straddle strategy involves selling a call and a put option at the same strike price at 9:20 AM in Indian markets, aiming to capitalize on time decay and volatility.
Database trading Part 5Database trading is a method of using data to make better decisions in the market. It involves using data analysis to improve profits and avoid costly mistakes
Algo trading, also known as algorithmic trading, is a method of executing orders by providing a predefined set of rules to a computer program. When the predefined conditions are met, orders are placed at a speed and frequency that is impossible for a human trader.
Line charts are one of the most commonly used charts in intraday trading. The line charts only display the closing price.
Advanced Level Pcr tradingThe Put-Call Ratio (PCR) is a popular technical indicator used by investors to assess market sentiment. It is calculated by dividing the volume or open interest of put options by call options over a specific time period. A higher PCR suggests bearish sentiment, while a lower PCR indicates bullish sentiment.
However, no PCR can be considered ideal, but usually, a PCR below 0.7 is typically viewed as a strong bullish sentiment while a PCR more than 1 is usually considered as a strong bearish sentiment.
If PCR is above 1, it would mean that more puts are being traded and since more puts are being traded by the retail traders (option buyers) this could mean that markets might do the opposite which is go up. Higher than 1 the PCR is, higher the chances of the market going up.
Why RSI is Important in Trading???The relative strength index (RSI) is a momentum indicator that measures recent price changes as it moves between 0 and 100. The RSI provides short-term buy and sell signals and is used to track the overbought and oversold levels of an asset.
To use the RSI indicator, check if the value is above 70 to show an asset is overbought, or below 30 to show it is oversold. Traders can use these signals to find possible trading opportunities.
Successful trades often occur when the RSI crosses above 30 (indicating a buy signal) or below 70 (indicating a sell signal). Adjusting the RSI period to 9 can make it more sensitive to price changes and be suitable for more active trading strategies
Database Trading Part 4Database trading is a method of using data to make better decisions in the market. It involves using data analysis to improve profits and avoid costly mistakes.
Trading data is a sub-category of financial market data. It provides real-time information about stock and market prices as well as historical trends for assets such as equities, fixed-income products, currencies and derivatives.
A database is an electronically stored, systematic collection of data. It can contain any type of data, including words, numbers, images, videos, and files. You can use software called a database management system (DBMS) to store, retrieve, and edit data.
Ed Seykota: The Trend-Following Legend Every Trader Must Know!Ed Seykota: The Mastermind Behind Trend Following
Hello, traders! 🚀 I hope you're all doing great in life and in your trading journey. Today, I bring you an educational post on Ed Seykota , one of the most successful traders of all time and a pioneer of trend-following strategies . His ability to ride trends and manage risk has made him an inspiration for traders worldwide.
Seykota revolutionized trading in the 1970s by developing one of the first computerized trading systems . He transformed a small trading account into millions using a disciplined, rule-based approach. His philosophy focuses on cutting losses early, riding winning trades, and following the market trend without emotional bias.
🔥 Ed Seykota’s Golden Rules of Trading
The Trend is Your Friend: Trade with the prevailing market trend. Fighting the market leads to unnecessary losses.
Cut Losses Quickly: Holding onto losing trades is a mistake. Accept small losses and move on to the next opportunity.
Ride Winners Until the Trend Ends: Let your profits run. Exiting too early limits your potential gains.
Risk Management is Crucial: Never risk too much on a single trade. Capital preservation is key to long-term success.
Follow a Systematic Approach: Avoid emotional decisions. A well-defined strategy ensures consistency.
Markets are Unpredictable: No trade is certain. Focus on probabilities and proven strategies rather than predictions.
🚀 What This Means for Traders:
By applying trend-following strategies , risk management , and disciplined execution , traders can navigate market uncertainty, avoid emotional decisions, and maximize long-term profitability.
🎯 Final Thought:
Ed Seykota once said: “Win or lose, everybody gets what they want from the market.” The key is to develop the right mindset and stick to a solid strategy .
💡 What’s your biggest takeaway from Seykota’s trading philosophy? Share your thoughts in the comments! 👇
Database Trading Part 2Database trading is a method of using data to make better decisions in the market. It involves using data analysis to improve profits and avoid costly mistakes.
How does database trading work?
Data collection: Data is collected from various sources, such as stock exchanges, third-party financial data vendors, investment banks, and hedge funds
Data analysis: The data is analyzed to identify patterns and trends
Decision making: The data analysis is used to make decisions about trading, such as when to buy or sell
Execution: The decisions are executed by machines or humans
Benefits of database trading Helps improve profits, Helps avoid costly mistakes, and Helps navigate the markets.
Examples of trading strategies
Day trading
Involves making many trades in a single day to profit from short-term price changes
Algorithmic trading
Involves using computer programs to execute trades based on predefined rules
Event trading
Involves profiting from short-term price movements triggered by specific events
Position trading
Involves holding positions for an extended period to profit from price movements