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Showing posts from June, 2022

Vertical Analysis

Vertical analysis is a technique for analyzing financial statements in which each line item is listed as a percentage of a base amount. Therefore, 1) line items on an income statement can be expressed as a percentage of gross sales, 2) while line items on a balance sheet can be expressed as a percentage of total assets or liabilities, 3) and vertical analysis of a cash flow statement displays each cash inflow or outflow as a percentage of the total cash inflows.

Portfolio Holdings

Investments that are a part of a portfolio. A variety of financial instruments, such as stocks, bonds, mutual funds, options, futures, and exchange-traded funds (ETFs), may be included in a portfolio's holdings.

Meme stock AMC Entertainment getting some life today. Great day trade

Today we cover AMC Entertainment as a day trade . AMC showed relative strength today as it was mentioned on Reddit group as well as Stocktwits. Today's catalyst was also attributed to the news that Top Gun 2 passed $1 billion in global box office over the weekend. We day traded AMC for a good 10% gain in just a few hours. Congrats!🎉 Watch this video to get the technicals and what to expect moving forward. Good trading! Trading Risk Disclaimer All the information shared is provided for educational purposes only. Any trades placed upon reliance of SharperTrades, LLC are taken at your own risk for your own account. Past performance is no guarantee. While there is great potential for reward trading stocks, cryptos, commodities, options, forex and other trading securities, there is also substantial risk of loss. All trading operations involve high risks of losing your entire investment. You must therefore decide your own suitability to trade. Trading results can never be guar

Green Bond Principles

Guidelines that are offered voluntarily when issuing Green Bonds, to help promote and encourage transparency, disclosure and integrity in the growth of the Green Bond market.

Pink Sheet

The term pink sheets refers to a listing for equities that trade over-the-counter (OTC) as opposed to on a major U.S. stock exchange. Many pink sheet listings are shares of company stock that don't meet the criteria to list on the main U.S. stock exchanges, like the New York Stock Exchange (NYSE), or the National Association of Securities Dealers Automated Quotations Stock Market (NASDAQ) for example.

Triple Bottom

A triple bottom is a bullish technical pattern that consists of three near-identical lows followed by a breakout above the resistance level. Typically a triple bottom is used in technical analysis to predict the reversal in the movement of an asset's price, in this case bullish. However, in addition to price holding above the breakout level, increased volume activity is also needed to validate that a bullish reversal is, in fact, happening.

Asset Allocation

Type of investment strategy that seeks to strike a balance between risk and reward by allocating a portfolio's assets in accordance with a person's objectives, risk tolerance, and investment horizon. Equities, fixed-income, and cash and equivalents are the three basic asset classes . Because each has a varied level of risk and reward, it will perform differently over time. Risk management for investments can be achieved through asset allocation. However, it does not provide insurance against lost investments. Asset Allocation: What Is It? Allocating your portfolio's assets between various asset classes, such as equities, bonds , and cash, is known as asset allocation. The purpose of asset allocation is to match investment outcomes with risk preferences and investment horizons. The three main asset classes are essentially stocks, bonds and cash. Stocks Investing in equities has typically resulted in the highest possible returns. In comparison to other types of investments, s

Order

An order is a set of instructions sent to a broker or brokerage firm to buy or sell a security on behalf of an investor. Typically, orders are placed over the phone or online through a trading platform. However, automated trading systems and algorithms are increasingly being used to place orders. The process of order execution begins when an order is placed.

Yield to Maturity

The rate of return an investor will earn if a long-term, interest-bearing investment, such as a bond, is kept until its maturity date.

Realized Loss

When an asset is sold for less than it was originally purchased for, a realized loss is a loss that is recorded. It occurs when an asset is sold for less than its book value cost.

Corporate Engagement

Shareholders engaging in conversations with management of a company in an effort to better understand how the company manages particular risks and/or to have a say in how the company makes decisions.

Pre-Market Trading

The trading period that takes place prior to the normal market session is known as pre-market trading. Every trading day, the pre-market trading session normally lasts from 8 to 9:30 a.m. EST. Many investors and traders monitor the pre-market trading activity to assess the market's strength and direction ahead of the regular trading session.

Fibonacci Extensions

A tool to set profit targets or predict how far a market may rise when a decline is complete. Extension levels are yet another potential location for a price reversal. These levels are created by connecting several points on a chart using Fibonacci ratios (as percentages). Fibonacci extension levels that are frequently encountered are 61.8%, 100%, 161.8%, 200%, and 261.8%.

Stop-Limit Order

A stop-limit order is a conditional trade that combines the qualities of a stop order with those of a limit order and is used to manage risk. A stop-limit order is connected to other order types such as limit orders (an order to buy or sell a specific number of shares at a specified price or better) and stop-on-quote orders (stop order that will be triggered only when a valid quoted price in the market is met).

Wash Sale Rule

An Internal Revenue Service (IRS) policy that forbids a taxpayer from claiming a tax deduction for a loss on a securities sold in a wash sale. A wash sale is one that takes place when a person sells or trades an asset at a loss and then purchases the same stock or security, or obtains a contract or option to do so, within 30 days before or after the sale. The purpose of the wash-sale rule is to discourage individuals and corporations from making an investment loss in order to claim a tax deduction while effectively keeping their stake in the securities.

Short Selling

Short selling is an investing or trading strategy that bets on the price drop of a stock or other security. Only seasoned traders and investors should use this advanced strategy.

Preferred Stock

A form of fixed-dividend stock that is given preference over common stock in the distribution of dividends and the sale of corporate assets. Preferred stock comes in a variety of forms, including convertible and adjustable-rate options.

Fixed Income Fund

A fund or portfolio where the majority of the investments are bonds. There is no set maturity date and no assurance of repayment.

Volume Price Trend Indicator (VPT)

Indicator that assists in determining the direction and strength of a security's price change. The indicator is a cumulative volume line that, depending on whether the security is moving higher or downward, adds or subtracts a multiple of the percentage change in the trend and current volume of a share price.

Prospectus

A formal written offer to sell securities that includes all the information an investor needs to make an informed decision, such as the business plan for a planned venture or details on an existing one. Mutual funds also publish prospectuses that include information required by the SEC, including financial statements, risk disclosures, manager biographies, objectives, and policies.

Stock Option

Stock options are a type of equity derivative, also referred to as equity options. An option is a financial product that is considered a derivative, which means that the value of the underlying asset or security determines or is derived from the value of the option. In the case of stock options, the company's shares (or an index of stocks) serve as their underlying asset. An investor who purchases a stock option has the right, but not the responsibility, to buy or sell the shares at a predetermined price and time. Options come in two flavors: puts, which bet on the stock falling, and calls, which bet on the price rising.

Vortex Indicator

A technical indicator used to detect trend reversals and validate present trends, made up of two lines: an uptrend line (VI+) and a downtrend line (VI-). Usually, these two lines are red and green, respectively.

Another Bad Day in the Market. Inverse ETFs, Day Trading and Cash Positions are the Best Strategies at the Moment

Market ended last week badly and started this week on an even worse note. The main culprits were a combination of rate-hike concerns and growth concerns. Today we cover the inverse ETFs that we follow (SPXS, SQQQ, TZA, UVXY), and some of today's day trades, as well a few other swing ideas that are currently on the move. Watch this video to get the technicals. Good trading! Trading Risk Disclaimer All the information shared is provided for educational purposes only. Any trades placed upon reliance of SharperTrades, LLC are taken at your own risk for your own account. Past performance is no guarantee. While there is great potential for reward trading stocks, cryptos, commodities, options, forex and other trading securities, there is also substantial risk of loss. All trading operations involve high risks of losing your entire investment. You must therefore decide your own suitability to trade. Trading results can never be guaranteed. SharperTrades, LLC is not registered as a

Zeta Model (Z-Score)

The Zeta Model is a mathematical model that predicts the likelihood of a public company going bankrupt within two years. The model's output is known as the company's Z-score (or zeta score), and it is thought to be a reasonably accurate predictor of future bankruptcy.

Top 10 Long and Short Positions

The top 10 holdings in each position category, ordered by market value (long and short). For reference, a long position is one in which an investor purchases stock and profits as an equity holder if the stock price rises. A short position is one in which an investor sells shares of stock (generally borrowed from their brokers) and profits as an equity holder if the stock price falls.

Service Sector

The U.S. Census Bureau states that the service sector consists of a variety of service industries, including warehousing and transportation services, information services, securities and other investment services, professional services, waste management, health care and social assistance, and arts, entertainment, and recreation. Economies that are primarily based on the service sector are regarded as being more advanced than industrial or agricultural economies.

Standard Deviation (SD)

A metric used in statistics to express how much a given value tends to deviate from the distribution's mean. The square root of the variance is used to calculate the standard deviation, a statistic that expresses how widely distributed a dataset is in relation to its mean. By calculating each data point's divergence from the mean, the standard deviation may be determined as the square root of variance. In simpler terms, a standard deviation is a measurement of how distant the data is from the mean. A low standard deviation suggests that data are concentrated around the mean, whereas a large standard deviation shows that data are more dispersed.

Archipelago

Archipelago is an electronic communications network (ECN) that joined the New York Stock Exchange (NYSE) in 2006 to form the NYSE Arca Exchange. EVNs allow for automated trading, passive order matching, after-hours trading, and immediate order execution. One of the first ECNs, Archipelago, was established in 1996 and served as a model for the Archipelago Exchange (ArcaEx), which was established in 2001 to support electronic stock trading for the main U.S. stock exchanges. The NYSE became a publicly traded business with both new electronic and conventional floor-trading capabilities soon after the merger with Archipelago. Insight into an Archipelago NYSE Arca, one of the world's largest electronic communication networks (ECNs), facilitates trading in stocks and options. NYSE Arca, part of the NYSE Euronext family, is headquartered in Chicago. Why using ECN? Simple. If you want to purchase or sell stocks on the market, but don't have time to do it manually, an electronic communi

Time Decay

Time decay is a measure of the rate at which the value of an option contract declines as time passes. Time decay accelerates as an option's expiration date approaches, since there is less time to profit from the trade.

Kappa

Kappa measures how sensitive the price of an option contract is to the changes in the volatility of the underlying asset. Volatility takes into account current price changes, historical price changes, and potential future price movements. Volatility is a term used to describe the magnitude and rate of price changes for a trading instrument, such as an option.

Impact Investing

A sustainable investment strategy that tries to produce both financial return and quantifiable good social or environmental effect. Activities like affordable housing, education, and healthcare are examples of investment themes.

Alpha

The amount of return expected from an investment from its inherent value. The term alpha describes the ability of an investment strategy to outperform the market, or its "edge". As a result, alpha is also frequently referred to as "excess return" or "abnormal rate of return," which relates to the notion that because markets are efficient, it is impossible to consistently generate returns that are higher than those of the general market. The Greek letter beta , which represents the total volatility or risk of the broad market (sometimes referred to as systematic market risk), is frequently employed in conjunction with alpha. Alpha, delta, as well as gamma, vega, and theta, are terms commonly used by options traders to describe the risk and reward of their respective option positions. These terms are often referred as the " Greeks ," and characterize the degree to which the value of an option fluctuates in response to changes in observable paramete

Naked Option

A naked option is issued when the option writer (the seller) does not currently own any or enough of the underlying security to fulfill their potential obligation. Naked options, also known as uncovered options, are unprotected derivatives, meaning that if the trade doesn't move in the projected direction, the naked option writer can suffer an undefined loss.

Long/Short Fund

A long/short fund is a kind of hedge fund or mutual fund that invests in both long and short positions, often in securities from a single market segment. These funds frequently buy relatively discounted stocks and sell overvalued ones using a variety of unconventional investing strategies, including leverage, derivatives, and short positions. Long/short funds are also known as enhanced funds or 130/30 funds.

Spread

In finance, a spread can mean different things. The spread is typically used to describe the distinction between two prices, rates, or yields. The spread is typically defined as the difference between the ask and bid prices of a security or asset, such as a stock, bond, or commodity. This is referred to as a bid-ask spread.

Paris Agreement

An accord within the United Nations Framework Convention on Climate Change setting a worldwide target to keep the rise in global temperatures over pre-industrial levels to well below 2° Celsius while pursuing measures to restrict the increase to 1.5° Celsius.

Market Share

A company's market share is the percentage of total revenues in an industry that it generates. Market share is derived by dividing the company's total sales over the period by the industry's total sales over the same period. This metric is employed to provide a basic understanding of a company's size in relation to its market and competitors. The business with the biggest market share in a certain sector is the market leader in that sector.

Momentum

Momentum is the rate of acceleration—or, more specifically, the pace of change—of the price of a security. Using momentum to enter a trend as it is developing is the goal of the momentum traders. Simply explained, momentum is the tendency of a price trend to continue growing or dropping for a specific period of time while typically accounting for both price and volume data. Momentum is frequently assessed in technical analysis using oscillators to identify trends.

XD (Excluding Dividend)

The symbol XD is used to indicate that a security is trading ex-dividend. It is an alphabetic qualifier that serves as abbreviation to advise investors about important information regarding a specific asset in a stock quote. At times, when the stock is trading ex-dividend, the symbol X alone might be used to.

Market Maker

A company or individual that actively quote two-sided markets in a given securities by giving asks and bids as well as the market size for each. Market makers contribute liquidity and depth to markets and make money on the spread between bid and ask prices. They could also execute main trades, or trades for their own accounts.

Micro-Cap

A publicly traded corporation in the United States with a market capitalization of between $50 million and $300 million. Market capitalization is higher for micro-cap companies than nano-caps, but lower for small-, mid-, large-, and mega-cap companies. It's important to note here that the stock price of a company does not necessarily increase because it has a larger market capitalization compared to a company with a lesser market capitalization.

Exclusions

A method of investing that uses a set of values, or norms-based criteria to remove certain assets or classes of investments from the investment universe. A sustainable investment approach that eliminates from a fund or portfolio certain industries, businesses, or business practices based on particular principles or norms. For instance, certain sectors can be purposefully left out of investment, such as the financials, tobaccos, or biotech.

Chapter 11

Chapter 11 is referred to as a reorganization bankruptcy since it entails reorganizing a debtor's financial affairs, liabilities, and assets.