The Israeli SpeculatorThe Israeli SpeculatorThe blog for the rational and skeptic investor. Philosophies about investing and trading NOT about lame techinques that work for no one. This is not your typical investing blog Articles
How To Make Money Trading Options With Synthetic Positions - Part II
2007-04-07 00:00:00 This is the second part of the option trading with synthetic positions. If you haven’t read it, please read it now. In this post, i’ll discuss the common risks in taking such synthetic positions so you would know what to avoid. Consider the following example: A stock trading at 103, a 100 call option with 1 ... More About: How To , Money , Make Money , Trading , With
How To Make Money Trading Options With Synthetic Positions - Part I
2007-04-07 00:00:00 Introduction With synthetic positions, we aim to make money not by trying to predict future movements, but by mis priced option prices. What does it mean to have a synthetic position? Consider the following example: A trader who purchases a call that expires in one month with a strike price of 100 and writes a put with ... More About: How To , Money , Make Money , Trading
Black and Scholes - The Greeks Part I
2007-04-05 00:00:00 This is a continuation of the Black and Scholes post. After we have computed the fair price with the B&S formula, we can compute more parameters that are related to the formula. Consider the buyer of stocks. What is he worried about? Obviously, a market decline. Anyone who only buys the underlying has one real concern, ... More About: Greek , Greeks , Part
Black & Scholes For Dummies - How To Do It Manually And With Excel
2007-04-04 00:00:00 This post is about simply making the formula work. First manually, then with excel. At the end of this post there is an excel file I had put. Why you need to know how to make the formula work yourself? Because this way, you’d understand the mechanism better, and it’s weakness. So without further ado, the ... More About: How To , Dummies , With , Black , Scholes
How to Estimate Future Volatility of a Stock Like The Pros
2007-04-04 00:00:00 Here is the method for estimating future volatility of a stock. Remember though that the method is not perfect, but by the law of averages, in the long run, it is a good estimate. The estimation of future volatility is essential for the Black and Scholes model Computing Historical Volatility: Suppose we want to compute the ... More About: How To , Future , Estima , Stock , Mate
A Monkey Plays The Stock Market - Do Hedge Fund Managers Do The Same?
2007-04-02 00:00:00 In the past, mathematicians coined the phrase “Monk ey Typing Shakespeare”, which meant that in the long run, everything will happen. Even if you put a monkey and let it type whatever he wants, eventually, all the greatest novels would be written by that monkey. Not only the greatest novels, even all the greatest but not ... More About: Fun , Stock Market , Market , Monkey
Does Adding Ads Mean Whoring Your Blog?
2007-04-01 00:00:00 Recently, I have added Google ads (not too hard to notice). I have to admit, I was not too happy about it. Since I am a part time student (writing my thesis currently), there is a certain integrity of free knowledge. That’s why I won’t charge for anything I write in here and I ... More About: Blog , Your , Ring
Blogs I Found Useful On The Net
2007-04-01 00:00:00 Here is my weekly list of blogs I have found useful on the net. Naturally, they all got something to do with the theme of this blog. The first one is a site with a lot of examples that is very educational about trading options. A lot of information. Check it out at http://www.1option.com/ The second one is ... More About: The Net , Blogs , Blog , The N , Useful
Has The Iranian President Played His Cards Right? The Israeli View
2007-04-01 00:00:00 My favorite off-topic subject, Iran , refuses to get out of the headlines. I said in earlier posts, that the Iranian President is no madman, but I do think he played his cards wrong. He got a few things going on for him, among many, the classic European impotence when it comes to calling on ... More About: Israel , Card , Play
Make Money Online
2007-04-01 00:00:00 I am sure some of you readers out there, who have blogs and put a real effort to put free quality material, as I try to do, want a little incentive for your hard work. A good site, which I regularly visit is John Chow’s site. John Chow dot Com is a blog that helps you make ... More About: Money , Make Money , Make Money Online , Online , Make
Latex is Not Working Right Now
2007-04-01 00:00:00 For some reason, my latex plugin is not working right now. For those who are trying to read my free Option Pricing For Dummies, I am sorry and just to let you know, I’m working on it. More About: Work , King , Right , Late , Working
Efficient Market Hypothesis Continued - Weak Efficiency
2007-04-01 00:00:00 In the last post, I talked about the three main categories of the Efficient Mark et hypothesis. In this post I’ll talk more about the weak form efficiency. To recap, the weak form efficiency basically says that current prices, reflect all past prices’ information. This means that techniques such Technical Analysis and Chart Reading can’t work. Consider ... More About: Efficiency , Conti
Financial Biases - What You Need to Watch Out For
2007-03-29 00:00:00 Whether you are presented with some research claim or about to do some research yourself with financial data, there are certain biases you need to watch out for if you want to get accurate results. Not only that, when presented with financial research, you need to look into the little details, to see if the ... More About: Watch , Financial , What , Hat , Bias
Buying Winners and Selling Losers? Does it Work?
2007-03-26 00:00:00 A popular view held by behavioural economists and psychologist alike is that people overreact to information. De Bondt and Thaler, two researches, suggested because of this a strategy of buying past losers and selling past winners that will achieve abnormal returns. They showed that over 3 to 5 years holding periods, stocks that performed ... More About: Buying , Selling , Work , Winners , Winner
Israeli Stock Market Weekend Review 03/23 - TA25 Recovers With a 1.69% Retu
2007-03-24 23:00:00 It has never been quiet in the political side. In the shadows of political investigation, among them fraud, of several top political figures such as the Minister of Treasury, Mr. Hirshenson, it seems that the stock market has become a different entity. I can see two possibilities for this. The first, is the total ... More About: Israel , Stock Market , Market , Review , With
Israeli Stock Market Weekend Review
2007-03-20 00:00:00 What a week it was! TA25 is currently at a level of 952 points. For those who have short memories let me recap the recent events briefly. It all started when the chairman of the Bank of Israel , Stanley Fisher, threatened to resign over salary negotiation failure for his staff at the bank. Not only ... More About: Stock Market , Market , Review , Stock
Sports and The Stock Market, Is There a Connection?
2007-03-20 00:00:00 In tribute of the upcoming qualifying games for the European Championship in football (soccer if you are American), which will be held in 1 week, here is the answer: Yes there is a connection. In what way? Remarkably, if the match is important, the returns of losing team’s stock market, on average, is lower! I ... More About: Sports , Sport , Stock Market , Market , Connection
What?s The Deal With Implied Volatility
2007-03-12 00:00:00 You have probably heard the term “Implied Volatility” tossed around a lot when it comes to option trading. If you did not know what it means, this post is for you. The landmark Black and Scholes equation, developed in the 70’s, gives a “fair” price of an option. You just plug in the interest rate, time ... More About: With , What , Hat , Deal , Lied
Why Doesn?t The Fortune Teller Buy A Lottery Ticket?
2007-03-11 00:00:00 As a fanatic of free knowledge and information, it troubles me to see so many people are taking workshops about trading from un-known sources, that can cost more than 1000$, instead of just picking up a book which covers the same material, and with even better clarity. note that I am talking about commercial courses ... More About: Fortune , Lottery , Elle , Tune , Otter
Iran Tries To Blame Israel (again)
2007-03-11 00:00:00 It appears that Iran has tried to put the blame on Isra el again on the disappearance of a top Irani General. Who would want to defect from Iran? After all, they are a peaceful country where no harm would be done to you if you go against the government. The latest speculation though is that the ... More About: Again , Blame
China Blocked My Blog!
2007-03-11 00:00:00 Apparently, my blog is blocked from my Chinese viewers. Makes me wonder why? Am I not worthy to the Chinese? True, I talk a lot about capitalism but I have nothing against communism. I hereby open a campaign to let me back into the Chinese market! All jokes aside, check to see if your site ... More About: China , Locked , Blog , Bloc , Block
Option Pricing For Dummies Part 1
2007-03-10 09:33:02 I have created this for those who are interested in the mechanism of the Black and Scholes formula, who don’t want to get into the math involved in the original Black and Scholes derivation. This is based on the CRR model (Cox, Ross, Rubinstein). The biggest revolution in modern finance is the pricing of options. The ... More About: Dummies , Part , Opti
The Trader
2007-03-10 09:33:02 The symbol of all relationships among such men, the moral symbol of respect for human beings, is the trader. We, who live by values, not by loot are traders, both in manner and spirit. A trader is a man who earns what he gets and does not give or take the undeserved. A trader does ... More About: Trade
Baloney Detection Kit
2007-03-10 09:33:02 For those of you who don’t know, the title refers to the excellent book by the late Carl Sagan, “The Demon Haunted World”. Those who read my blog, know that I’m a skeptic when it comes to my life’s philosophy, and these days with all the knowledge available to us on the internet, I think ... More About: Detection , Lone , Alone
China and Israel
2007-03-06 21:30:04 China’s market crashed down by 9% and all the markets have responded by a decline, though not as sharp as China’s decline. I have read the local news and the amount of nonsense that is written is amazing. The usual “Oh it was expected!” and the “It is healthy for the market to decline”. Nothing more upsets ... More About: Israel , China , Isra
10 Myths Regarding Israel
2007-03-06 21:30:04 1) We don’t have the most beautiful girls in the world. We have the most girls who say they are the most beautiful in the world. 2) Not all of us are orthodox jews. Most are actually secular and don’t practice actively the jewish religion. 3) We don’t go around riding camels. 4) The Isra el i Intelligence, Mossad, ... More About: Myths , Myth
Where Are The Customers? Yachts?
2007-03-06 21:30:04 For those of you who know, the title refers to a book which exposes the folly and hypocrisy of Wall Street. The title refers to a story about a visitor to New York who admired the yachts of the bankers and brokers. Naively, he asked where all the customers’ yachts were? Of course, none of ... More About: Customers , Customer , Here , Where , Custom
Why I am Not Afraid Iran Will Bomb Us
2007-03-06 21:30:04 Note: This blog is usually about financial speculation, but I want to discuss the idea of Iran developing a nuclear bomb and actually USING IT. Living in Israel has it’s own peculiarities. One thing though remains always constant, and I am not talking about the high taxes! I am talking about the fact that at ... More About: Will , Bomb , Raid
Efficient Market Hypothesis
2007-02-26 09:27:01 The Efficient Mark et Hypothesis, or EMH, is a concept developed by Eugene Fama, which asserts that the prices of financial instruments, reflect all known information about the future values and beliefs of the investors about those particular financial instruments. This means that you, the investor, can't outperform the market in ...
Index Funds Failure In Israel
More articles from this author:2007-02-26 09:27:01 Although popular in the US, index funds in Israel are still new and not popular or known to the public. It is very sad to see that because of the lack of financial education in Israel, customers continue to pay inflated commisions to funds with sub-par returns. For those of you ... More About: Fun , Failure , Fund , Index 1, 2, 3, 4 |
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