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Are You a Bear or a Bull? Or a BeaBu?

The almost zero difference between long and short Dollars or euros are the same, regardless if you make or lose them with the market going up or down. But in minds of most people – even when we consciously try to avoid it – trading on long and short side still feels different. Permanent bulls … Read more


Moving Averages: Basic Logic and Calculation

Topics: Trading Strategies > Technical Analysis      

Moving average: probably the most widely used technical indicator Moving averages are among the most widely used technical indicators. I would even say moving average is the most widely used technical indicator, though no one can really know and count this. Moving averages enjoy this privilege thanks to their simplicity, both in calculation (or setup … Read more


In the Money vs. At the Money Options: An Example

In the money vs. at the money options In the money options are options which have positive intrinsic value. This means that at the moment of expiration (when no time value is left), the option still represents some value if you exercise it. At the money options are options with strike price equal or very … Read more


Absorbed (Stock Market)

Topics: Glossary > A      

Absorbed market The expression absorbed describes a situation in the stock market, when there are corresponding orders on both sides of the market in a particular stock – it means that at the current price there are both people willing to buy and people willing to sell. As a result, in an absorbed market further … Read more


Breadth Ratio

Topics: Glossary > B      

Breadth ratio definition Breadth Ratio is a measure of breadth of a stock market. Similarly to the Advance/Decline line or index, it compares the number of rising stocks to the number of falling stocks in a particular period. But unlike the A/D line, the breadth ratio divides the number of rising stocks by the number … Read more


Intrinsic Value of Options and Stocks

The concept of intrinsic value in finance Intrinsic value is a term frequently used for options and stocks, but it can be applied to any asset. As a financial term, intrinsic value of a security or asset describes the value that is contained in the asset itself. Intrinsic value is often referred to as fundamental … Read more


Accelerated Depreciation

Topics: Glossary > A      

Depreciation Accelerated depreciation is a method used in accounting for costs and assets. Through depreciation a company’s accounting reflects the fact that the assets the company holds (for example some machines used in producing the output) decrease in value over time (as they get old and their condition may deteriorate through using them). Technically depreciation … Read more


Breadth of the Market

Topics: Glossary > B      

Breadth of the market definition Breadth of the market represents the number of stocks participating in a particular market’s move as a percentage of the total number of stocks. For example, let’s take the S&P500 index, which contains 500 stocks. If the S&P500 index is rising on a particular day and of the 500 stocks … Read more


Accounts Receivable Turnover Ratio

Topics: Glossary > A      

Accounts Receivable Turnover Ratio calculation Accounts Receivable Turnover Ratio is the ratio of net credit sales to average accounts receivable. Net credit sales represent the value of company’s products sold to customers without collecting the cash (on credit) in a particular time period (there are two kinds of sales: cash sales, which you now don’t … Read more


Measuring Directional Exposure with Delta: Single Option and Option Spreads

Delta as a measure of directional exposure The relationship between the underlying stock’s price changes and the option’s price changes is measured by the well known Greek letter delta. In general, delta measures by how much the value (market price) of an option or an option spread position changes when the market price of the … Read more


4 Benefits of Alternative Investments as Part of Your Portfolio

Topics: Alternative Investments      

Benefits of alternative investments Alternative investments represent an aggregate of hedge funds, private equity, real estate, commodities, managed futures, and a growing number of other types of (often exotic and mysterious) investments. Alternative investments have become increasingly popular and talked-about in the recent past – not only due to stories about billionaire fund managers and … Read more



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