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My home-made bar replay for MT4

I made a home-made bar replay for MT4 as an alternative to the tradingview bar replay. You can change timeframes and use objects easily. It just uses vertical lines to block the future candles. Then it adjusts the vertical lines when you change zoom or time frames to keep the "future" bars hidden.
I am not a professional coder so this is not as robust as something like Soft4fx or Forex Tester. But for me it gets the job done and is very convenient. Maybe you will find some benefit from it.

Here are the steps to use it:
1) copy the text from the code block
2) go to MT4 terminal and open Meta Editor (click icon or press F4)
3) go to File -> New -> Expert Advisor
4) put in a title and click Next, Next, Finish
5) Delete all text from new file and paste in text from code block
6) go back to MT4
7) Bring up Navigator (Ctrl+N if it's not already up)
8) go to expert advisors section and find what you titled it
9) open up a chart of the symbol you want to test
10) add the EA to this chart
11) specify colors and start time in inputs then press OK
12) use "S" key on your keyboard to advance 1 bar of current time frame
13) use tool bar buttons to change zoom and time frames, do objects, etc.
14) don't turn on auto scroll. if you do by accident, press "S" to return to simulation time.
15) click "buy" and "sell" buttons (white text, top center) to generate entry, TP and SL lines to track your trade
16) to cancel or close a trade, press "close order" then click the white entry line
17) drag and drop TP/SL lines to modify RR
18) click "End" to delete all objects and remove simulation from chart
19) to change simulation time, click "End", then add the simulator EA to your chart with a new start time
20) When you click "End", your own objects will be deleted too, so make sure you are done with them
21) keep track of your own trade results manually
22) use Tools-> History center to download new data if you need it. the simulator won't work on time frames if you don't have historical data going back that far, but it will work on time frames that you have the data for. If you have data but its not appearing, you might also need to increase max bars in chart in Tools->Options->Charts.
23) don't look at status bar if you are moused over hidden candles, or to avoid this you can hide the status bar.


Here is the code block.
//+------------------------------------------------------------------+ //| Bar Replay V2.mq4 | //| Copyright 2020, MetaQuotes Software Corp. | //| https://www.mql5.com | //+------------------------------------------------------------------+ #property copyright "Copyright 2020, MetaQuotes Software Corp." #property link "https://www.mql5.com" #property version "1.00" #property strict #define VK_A 0x41 #define VK_S 0x53 #define VK_X 0x58 #define VK_Z 0x5A #define VK_V 0x56 #define VK_C 0x43 #define VK_W 0x57 #define VK_E 0x45 double balance; string balance_as_string; int filehandle; int trade_ticket = 1; string objectname; string entry_line_name; string tp_line_name; string sl_line_name; string one_R_line_name; double distance; double entry_price; double tp_price; double sl_price; double one_R; double TP_distance; double gain_in_R; string direction; bool balance_file_exist; double new_balance; double sl_distance; string trade_number; double risk; double reward; string RR_string; int is_tp_or_sl_line=0; int click_to_cancel=0; input color foreground_color = clrWhite; input color background_color = clrBlack; input color bear_candle_color = clrRed; input color bull_candle_color = clrSpringGreen; input color current_price_line_color = clrGray; input string start_time = "2020.10.27 12:00"; input int vertical_margin = 100; //+------------------------------------------------------------------+ //| Expert initialization function | //+------------------------------------------------------------------+ int OnInit() { Comment(""); ChartNavigate(0,CHART_BEGIN,0); BlankChart(); ChartSetInteger(0,CHART_SHIFT,true); ChartSetInteger(0,CHART_FOREGROUND,false); ChartSetInteger(0,CHART_AUTOSCROLL,false); ChartSetInteger(0,CHART_SCALEFIX,false); ChartSetInteger(0,CHART_SHOW_OBJECT_DESCR,true); if (ObjectFind(0,"First OnInit")<0){ CreateStorageHLine("First OnInit",1);} if (ObjectFind(0,"Simulation Time")<0){ CreateTestVLine("Simulation Time",StringToTime(start_time));} string vlinename; for (int i=0; i<=1000000; i++){ vlinename="VLine"+IntegerToString(i); ObjectDelete(vlinename); } HideBars(SimulationBarTime(),0); //HideBar(SimulationBarTime()); UnBlankChart(); LabelCreate("New Buy Button","Buy",0,38,foreground_color); LabelCreate("New Sell Button","Sell",0,41,foreground_color); LabelCreate("Cancel Order","Close Order",0,44,foreground_color); LabelCreate("Risk To Reward","RR",0,52,foreground_color); LabelCreate("End","End",0,35,foreground_color); ObjectMove(0,"First OnInit",0,0,0); //--- create timer EventSetTimer(60); return(INIT_SUCCEEDED); } //+------------------------------------------------------------------+ //| Expert deinitialization function | //+------------------------------------------------------------------+ void OnDeinit(const int reason) { //--- destroy timer EventKillTimer(); } //+------------------------------------------------------------------+ //| Expert tick function | //+------------------------------------------------------------------+ void OnTick() { //--- } //+------------------------------------------------------------------+ //| ChartEvent function | //+------------------------------------------------------------------+ void OnChartEvent(const int id, const long &lparam, const double &dparam, const string &sparam) { if (id==CHARTEVENT_CHART_CHANGE){ int chartscale = ChartGetInteger(0,CHART_SCALE,0); int lastchartscale = ObjectGetDouble(0,"Last Chart Scale",OBJPROP_PRICE,0); if (chartscale!=lastchartscale){ int chartscale = ChartGetInteger(0,CHART_SCALE,0); ObjectMove(0,"Last Chart Scale",0,0,chartscale); OnInit(); }} if (id==CHARTEVENT_KEYDOWN){ if (lparam==VK_S){ IncreaseSimulationTime(); UnHideBar(SimulationPosition()); NavigateToSimulationPosition(); CreateHLine(0,"Current Price",Close[SimulationPosition()+1],current_price_line_color,1,0,true,false,false,"price"); SetChartMinMax(); }} if(id==CHARTEVENT_OBJECT_CLICK) { if(sparam=="New Sell Button") { distance = iATR(_Symbol,_Period,20,SimulationPosition()+1)/2; objectname = "Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1],foreground_color,2,5,false,true,true,"Sell"); objectname = "TP for Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1]-distance*2,clrAqua,2,5,false,true,true,"TP"); objectname = "SL for Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1]+distance,clrRed,2,5,false,true,true,"SL"); trade_ticket+=1; } } if(id==CHARTEVENT_OBJECT_CLICK) { if(sparam=="New Buy Button") { distance = iATR(_Symbol,_Period,20,SimulationPosition()+1)/2; objectname = "Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1],foreground_color,2,5,false,true,true,"Buy"); objectname = "TP for Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1]+distance*2,clrAqua,2,5,false,true,true,"TP"); objectname = "SL for Trade # "+IntegerToString(trade_ticket); CreateHLine(0,objectname,Close[SimulationPosition()+1]-distance,clrRed,2,5,false,true,true,"SL"); trade_ticket+=1; } } if(id==CHARTEVENT_OBJECT_DRAG) { if(StringFind(sparam,"TP",0)==0) { is_tp_or_sl_line=1; } if(StringFind(sparam,"SL",0)==0) { is_tp_or_sl_line=1; } Comment(is_tp_or_sl_line); if(is_tp_or_sl_line==1) { trade_number = StringSubstr(sparam,7,9); entry_line_name = trade_number; tp_line_name = "TP for "+entry_line_name; sl_line_name = "SL for "+entry_line_name; entry_price = ObjectGetDouble(0,entry_line_name,OBJPROP_PRICE,0); tp_price = ObjectGetDouble(0,tp_line_name,OBJPROP_PRICE,0); sl_price = ObjectGetDouble(0,sl_line_name,OBJPROP_PRICE,0); sl_distance = MathAbs(entry_price-sl_price); TP_distance = MathAbs(entry_price-tp_price); reward = TP_distance/sl_distance; RR_string = "RR = 1 : "+DoubleToString(reward,2); ObjectSetString(0,"Risk To Reward",OBJPROP_TEXT,RR_string); is_tp_or_sl_line=0; } } if(id==CHARTEVENT_OBJECT_CLICK) { if(sparam=="Cancel Order") { click_to_cancel=1; Comment("please click the entry line of the order you wish to cancel."); } } if(id==CHARTEVENT_OBJECT_CLICK) { if(sparam!="Cancel Order") { if(click_to_cancel==1) { if(ObjectGetInteger(0,sparam,OBJPROP_TYPE,0)==OBJ_HLINE) { entry_line_name = sparam; tp_line_name = "TP for "+sparam; sl_line_name = "SL for "+sparam; ObjectDelete(0,entry_line_name); ObjectDelete(0,tp_line_name); ObjectDelete(0,sl_line_name); click_to_cancel=0; ObjectSetString(0,"Risk To Reward",OBJPROP_TEXT,"RR"); } } } } if (id==CHARTEVENT_OBJECT_CLICK){ if (sparam=="End"){ ObjectsDeleteAll(0,-1,-1); ExpertRemove(); }} } //+------------------------------------------------------------------+ void CreateStorageHLine(string name, double value){ ObjectDelete(name); ObjectCreate(0,name,OBJ_HLINE,0,0,value); ObjectSetInteger(0,name,OBJPROP_SELECTED,false); ObjectSetInteger(0,name,OBJPROP_SELECTABLE,false); ObjectSetInteger(0,name,OBJPROP_COLOR,clrNONE); ObjectSetInteger(0,name,OBJPROP_BACK,true); ObjectSetInteger(0,name,OBJPROP_ZORDER,0); } void CreateTestHLine(string name, double value){ ObjectDelete(name); ObjectCreate(0,name,OBJ_HLINE,0,0,value); ObjectSetInteger(0,name,OBJPROP_SELECTED,false); ObjectSetInteger(0,name,OBJPROP_SELECTABLE,false); ObjectSetInteger(0,name,OBJPROP_COLOR,clrWhite); ObjectSetInteger(0,name,OBJPROP_BACK,true); ObjectSetInteger(0,name,OBJPROP_ZORDER,0); } bool IsFirstOnInit(){ bool bbb=false; if (ObjectGetDouble(0,"First OnInit",OBJPROP_PRICE,0)==1){return true;} return bbb; } void CreateTestVLine(string name, datetime timevalue){ ObjectDelete(name); ObjectCreate(0,name,OBJ_VLINE,0,timevalue,0); ObjectSetInteger(0,name,OBJPROP_SELECTED,false); ObjectSetInteger(0,name,OBJPROP_SELECTABLE,false); ObjectSetInteger(0,name,OBJPROP_COLOR,clrNONE); ObjectSetInteger(0,name,OBJPROP_BACK,false); ObjectSetInteger(0,name,OBJPROP_ZORDER,3); } datetime SimulationTime(){ return ObjectGetInteger(0,"Simulation Time",OBJPROP_TIME,0); } int SimulationPosition(){ return iBarShift(_Symbol,_Period,SimulationTime(),false); } datetime SimulationBarTime(){ return Time[SimulationPosition()]; } void IncreaseSimulationTime(){ ObjectMove(0,"Simulation Time",0,Time[SimulationPosition()-1],0); } void NavigateToSimulationPosition(){ ChartNavigate(0,CHART_END,-1*SimulationPosition()+15); } void NotifyNotEnoughHistoricalData(){ BlankChart(); Comment("Sorry, but there is not enough historical data to load this time frame."+"\n"+ "Please load more historical data or use a higher time frame. Thank you :)");} void UnHideBar(int barindex){ ObjectDelete(0,"VLine"+IntegerToString(barindex+1)); } void BlankChart(){ ChartSetInteger(0,CHART_COLOR_FOREGROUND,clrNONE); ChartSetInteger(0,CHART_COLOR_CANDLE_BEAR,clrNONE); ChartSetInteger(0,CHART_COLOR_CANDLE_BULL,clrNONE); ChartSetInteger(0,CHART_COLOR_CHART_DOWN,clrNONE); ChartSetInteger(0,CHART_COLOR_CHART_UP,clrNONE); ChartSetInteger(0,CHART_COLOR_CHART_LINE,clrNONE); ChartSetInteger(0,CHART_COLOR_GRID,clrNONE); ChartSetInteger(0,CHART_COLOR_ASK,clrNONE); ChartSetInteger(0,CHART_COLOR_BID,clrNONE);} void UnBlankChart(){ ChartSetInteger(0,CHART_COLOR_FOREGROUND,foreground_color); ChartSetInteger(0,CHART_COLOR_CANDLE_BEAR,bear_candle_color); ChartSetInteger(0,CHART_COLOR_CANDLE_BULL,bull_candle_color); ChartSetInteger(0,CHART_COLOR_BACKGROUND,background_color); ChartSetInteger(0,CHART_COLOR_CHART_DOWN,foreground_color); ChartSetInteger(0,CHART_COLOR_CHART_UP,foreground_color); ChartSetInteger(0,CHART_COLOR_CHART_LINE,foreground_color); ChartSetInteger(0,CHART_COLOR_GRID,clrNONE); ChartSetInteger(0,CHART_COLOR_ASK,clrNONE); ChartSetInteger(0,CHART_COLOR_BID,clrNONE);} void HideBars(datetime starttime, int shift){ int startbarindex = iBarShift(_Symbol,_Period,starttime,false); ChartNavigate(0,CHART_BEGIN,0); if (Time[WindowFirstVisibleBar()]>SimulationTime()){NotifyNotEnoughHistoricalData();} if (Time[WindowFirstVisibleBar()]=0; i--){ vlinename="VLine"+IntegerToString(i); ObjectCreate(0,vlinename,OBJ_VLINE,0,Time[i],0); ObjectSetInteger(0,vlinename,OBJPROP_COLOR,background_color); ObjectSetInteger(0,vlinename,OBJPROP_BACK,false); ObjectSetInteger(0,vlinename,OBJPROP_WIDTH,vlinewidth); ObjectSetInteger(0,vlinename,OBJPROP_ZORDER,10); ObjectSetInteger(0,vlinename,OBJPROP_FILL,true); ObjectSetInteger(0,vlinename,OBJPROP_STYLE,STYLE_SOLID); ObjectSetInteger(0,vlinename,OBJPROP_SELECTED,false); ObjectSetInteger(0,vlinename,OBJPROP_SELECTABLE,false); } NavigateToSimulationPosition(); SetChartMinMax();} }//end of HideBars function void SetChartMinMax(){ int firstbar = WindowFirstVisibleBar(); int lastbar = SimulationPosition(); int lastbarwhenscrolled = WindowFirstVisibleBar()-WindowBarsPerChart(); if (lastbarwhenscrolled>lastbar){lastbar=lastbarwhenscrolled;} double highest = High[iHighest(_Symbol,_Period,MODE_HIGH,firstbar-lastbar,lastbar)]; double lowest = Low[iLowest(_Symbol,_Period,MODE_LOW,firstbar-lastbar,lastbar)]; ChartSetInteger(0,CHART_SCALEFIX,true); ChartSetDouble(0,CHART_FIXED_MAX,highest+vertical_margin*_Point); ChartSetDouble(0,CHART_FIXED_MIN,lowest-vertical_margin*_Point); } void LabelCreate(string labelname, string labeltext, int row, int column, color labelcolor){ int ylocation = row*18; int xlocation = column*10; ObjectCreate(0,labelname,OBJ_LABEL,0,0,0); ObjectSetString(0,labelname,OBJPROP_TEXT,labeltext); ObjectSetInteger(0,labelname,OBJPROP_COLOR,labelcolor); ObjectSetInteger(0,labelname,OBJPROP_FONTSIZE,10); ObjectSetInteger(0,labelname,OBJPROP_ZORDER,10); ObjectSetInteger(0,labelname,OBJPROP_BACK,false); ObjectSetInteger(0,labelname,OBJPROP_CORNER,CORNER_LEFT_UPPER); ObjectSetInteger(0,labelname,OBJPROP_ANCHOR,ANCHOR_LEFT_UPPER); ObjectSetInteger(0,labelname,OBJPROP_XDISTANCE,xlocation); ObjectSetInteger(0,labelname,OBJPROP_YDISTANCE,ylocation);} double GetHLinePrice(string name){ return ObjectGetDouble(0,name,OBJPROP_PRICE,0); } void CreateHLine(int chartid, string objectnamey, double objectprice, color linecolor, int width, int zorder, bool back, bool selected, bool selectable, string descriptionn) { ObjectDelete(chartid,objectnamey); ObjectCreate(chartid,objectnamey,OBJ_HLINE,0,0,objectprice); ObjectSetString(chartid,objectnamey,OBJPROP_TEXT,objectprice); ObjectSetInteger(chartid,objectnamey,OBJPROP_COLOR,linecolor); ObjectSetInteger(chartid,objectnamey,OBJPROP_WIDTH,width); ObjectSetInteger(chartid,objectnamey,OBJPROP_ZORDER,zorder); ObjectSetInteger(chartid,objectnamey,OBJPROP_BACK,back); ObjectSetInteger(chartid,objectnamey,OBJPROP_SELECTED,selected); ObjectSetInteger(chartid,objectnamey,OBJPROP_SELECTABLE,selectable); ObjectSetString(0,objectnamey,OBJPROP_TEXT,descriptionn); } //end of code 
submitted by Learning_2 to Forex [link] [comments]

Former investment bank FX trader: Risk management part 3/3

Former investment bank FX trader: Risk management part 3/3
Welcome to the third and final part of this chapter.
Thank you all for the 100s of comments and upvotes - maybe this post will take us above 1,000 for this topic!
Keep any feedback or questions coming in the replies below.
Before you read this note, please start with Part I and then Part II so it hangs together and makes sense.
Part III
  • Squeezes and other risks
  • Market positioning
  • Bet correlation
  • Crap trades, timeouts and monthly limits

Squeezes and other risks

We are going to cover three common risks that traders face: events; squeezes, asymmetric bets.

Events

Economic releases can cause large short-term volatility. The most famous is Non Farm Payrolls, which is the most widely watched measure of US employment levels and affects the price of many instruments.On an NFP announcement currencies like EURUSD might jump (or drop) 100 pips no problem.
This is fine and there are trading strategies that one may employ around this but the key thing is to be aware of these releases.You can find economic calendars all over the internet - including on this site - and you need only check if there are any major releases each day or week.
For example, if you are trading off some intraday chart and scalping a few pips here and there it would be highly sensible to go into a known data release flat as it is pure coin-toss and not the reason for your trading. It only takes five minutes each day to plan for the day ahead so do not get caught out by this. Many retail traders get stopped out on such events when price volatility is at its peak.

Squeezes

Short squeezes bring a lot of danger and perhaps some opportunity.
The story of VW and Porsche is the best short squeeze ever. Throughout these articles we've used FX examples wherever possible but in this one instance the concept (which is also highly relevant in FX) is best illustrated with an historical lesson from a different asset class.
A short squeeze is when a participant ends up in a short position they are forced to cover. Especially when the rest of the market knows that this participant can be bullied into stopping out at terrible levels, provided the market can briefly drive the price into their pain zone.

There's a reason for the car, don't worry
Hedge funds had been shorting VW stock. However the amount of VW stock available to buy in the open market was actually quite limited. The local government owned a chunk and Porsche itself had bought and locked away around 30%. Neither of these would sell to the hedge-funds so a good amount of the stock was un-buyable at any price.
If you sell or short a stock you must be prepared to buy it back to go flat at some point.
To cut a long story short, Porsche bought a lot of call options on VW stock. These options gave them the right to purchase VW stock from banks at slightly above market price.
Eventually the banks who had sold these options realised there was no VW stock to go out and buy since the German government wouldn’t sell its allocation and Porsche wouldn’t either. If Porsche called in the options the banks were in trouble.
Porsche called in the options which forced the shorts to buy stock - at whatever price they could get it.
The price squeezed higher as those that were short got massively squeezed and stopped out. For one brief moment in 2008, VW was the world’s most valuable company. Shorts were burned hard.

Incredible event
Porsche apparently made $11.5 billion on the trade. The BBC described Porsche as “a hedge fund with a carmaker attached.”
If this all seems exotic then know that the same thing happens in FX all the time. If everyone in the market is talking about a key level in EURUSD being 1.2050 then you can bet the market will try to push through 1.2050 just to take out any short stops at that level. Whether it then rallies higher or fails and trades back lower is a different matter entirely.
This brings us on to the matter of crowded trades. We will look at positioning in more detail in the next section. Crowded trades are dangerous for PNL. If everyone believes EURUSD is going down and has already sold EURUSD then you run the risk of a short squeeze.
For additional selling to take place you need a very good reason for people to add to their position whereas a move in the other direction could force mass buying to cover their shorts.
A trading mentor when I worked at the investment bank once advised me:
Always think about which move would cause the maximum people the maximum pain. That move is precisely what you should be watching out for at all times.

Asymmetric losses

Also known as picking up pennies in front of a steamroller. This risk has caught out many a retail trader. Sometimes it is referred to as a "negative skew" strategy.
Ideally what you are looking for is asymmetric risk trade set-ups: that is where the downside is clearly defined and smaller than the upside. What you want to avoid is the opposite.
A famous example of this going wrong was the Swiss National Bank de-peg in 2012.
The Swiss National Bank had said they would defend the price of EURCHF so that it did not go below 1.2. Many people believed it could never go below 1.2 due to this. Many retail traders therefore opted for a strategy that some describe as ‘picking up pennies in front of a steam-roller’.
They would would buy EURCHF above the peg level and hope for a tiny rally of several pips before selling them back and keep doing this repeatedly. Often they were highly leveraged at 100:1 so that they could amplify the profit of the tiny 5-10 pip rally.
Then this happened.

Something that changed FX markets forever
The SNB suddenly did the unthinkable. They stopped defending the price. CHF jumped and so EURCHF (the number of CHF per 1 EUR) dropped to new lows very fast. Clearly, this trade had horrific risk : reward asymmetry: you risked 30% to make 0.05%.
Other strategies like naively selling options have the same result. You win a small amount of money each day and then spectacularly blow up at some point down the line.

Market positioning

We have talked about short squeezes. But how do you know what the market position is? And should you care?
Let’s start with the first. You should definitely care.
Let’s imagine the entire market is exceptionally long EURUSD and positioning reaches extreme levels. This makes EURUSD very vulnerable.
To keep the price going higher EURUSD needs to attract fresh buy orders. If everyone is already long and has no room to add, what can incentivise people to keep buying? The news flow might be good. They may believe EURUSD goes higher. But they have already bought and have their maximum position on.
On the flip side, if there’s an unexpected event and EURUSD gaps lower you will have the entire market trying to exit the position at the same time. Like a herd of cows running through a single doorway. Messy.
We are going to look at this in more detail in a later chapter, where we discuss ‘carry’ trades. For now this TRYJPY chart might provide some idea of what a rush to the exits of a crowded position looks like.

A carry trade position clear-out in action
Knowing if the market is currently at extreme levels of long or short can therefore be helpful.
The CFTC makes available a weekly report, which details the overall positions of speculative traders “Non Commercial Traders” in some of the major futures products. This includes futures tied to deliverable FX pairs such as EURUSD as well as products such as gold. The report is called “CFTC Commitments of Traders” ("COT").
This is a great benchmark. It is far more representative of the overall market than the proprietary ones offered by retail brokers as it covers a far larger cross-section of the institutional market.
Generally market participants will not pay a lot of attention to commercial hedgers, which are also detailed in the report. This data is worth tracking but these folks are simply hedging real-world transactions rather than speculating so their activity is far less revealing and far more noisy.
You can find the data online for free and download it directly here.

Raw format is kinda hard to work with

However, many websites will chart this for you free of charge and you may find it more convenient to look at it that way. Just google “CFTC positioning charts”.

But you can easily get visualisations
You can visually spot extreme positioning. It is extremely powerful.
Bear in mind the reports come out Friday afternoon US time and the report is a snapshot up to the prior Tuesday. That means it is a lagged report - by the time it is released it is a few days out of date. For longer term trades where you hold positions for weeks this is of course still pretty helpful information.
As well as the absolute level (is the speculative market net long or short) you can also use this to pick up on changes in positioning.
For example if bad news comes out how much does the net short increase? If good news comes out, the market may remain net short but how much did they buy back?
A lot of traders ask themselves “Does the market have this trade on?” The positioning data is a good method for answering this. It provides a good finger on the pulse of the wider market sentiment and activity.
For example you might say: “There was lots of noise about the good employment numbers in the US. However, there wasn’t actually a lot of position change on the back of it. Maybe everyone who wants to buy already has. What would happen now if bad news came out?”
In general traders will be wary of entering a crowded position because it will be hard to attract additional buyers or sellers and there could be an aggressive exit.
If you want to enter a trade that is showing extreme levels of positioning you must think carefully about this dynamic.

Bet correlation

Retail traders often drastically underestimate how correlated their bets are.
Through bitter experience, I have learned that a mistake in position correlation is the root of some of the most serious problems in trading. If you have eight highly correlated positions, then you are really trading one position that is eight times as large.
Bruce Kovner of hedge fund, Caxton Associates
For example, if you are trading a bunch of pairs against the USD you will end up with a simply huge USD exposure. A single USD-trigger can ruin all your bets. Your ideal scenario — and it isn’t always possible — would be to have a highly diversified portfolio of bets that do not move in tandem.
Look at this chart. Inverted USD index (DXY) is green. AUDUSD is orange. EURUSD is blue.

Chart from TradingView
So the whole thing is just one big USD trade! If you are long AUDUSD, long EURUSD, and short DXY you have three anti USD bets that are all likely to work or fail together.
The more diversified your portfolio of bets are, the more risk you can take on each.
There’s a really good video, explaining the benefits of diversification from Ray Dalio.
A systematic fund with access to an investable universe of 10,000 instruments has more opportunity to make a better risk-adjusted return than a trader who only focuses on three symbols. Diversification really is the closest thing to a free lunch in finance.
But let’s be pragmatic and realistic. Human retail traders don’t have capacity to run even one hundred bets at a time. More realistic would be an average of 2-3 trades on simultaneously. So what can be done?
For example:
  • You might diversify across time horizons by having a mix of short-term and long-term trades.
  • You might diversify across asset classes - trading some FX but also crypto and equities.
  • You might diversify your trade generation approach so you are not relying on the same indicators or drivers on each trade.
  • You might diversify your exposure to the market regime by having some trades that assume a trend will continue (momentum) and some that assume we will be range-bound (carry).
And so on. Basically you want to scan your portfolio of trades and make sure you are not putting all your eggs in one basket. If some trades underperform others will perform - assuming the bets are not correlated - and that way you can ensure your overall portfolio takes less risk per unit of return.
The key thing is to start thinking about a portfolio of bets and what each new trade offers to your existing portfolio of risk. Will it diversify or amplify a current exposure?

Crap trades, timeouts and monthly limits

One common mistake is to get bored and restless and put on crap trades. This just means trades in which you have low conviction.
It is perfectly fine not to trade. If you feel like you do not understand the market at a particular point, simply choose not to trade.
Flat is a position.
Do not waste your bullets on rubbish trades. Only enter a trade when you have carefully considered it from all angles and feel good about the risk. This will make it far easier to hold onto the trade if it moves against you at any point. You actually believe in it.
Equally, you need to set monthly limits. A standard limit might be a 10% account balance stop per month. At that point you close all your positions immediately and stop trading till next month.

Be strict with yourself and walk away
Let’s assume you started the year with $100k and made 5% in January so enter Feb with $105k balance. Your stop is therefore 10% of $105k or $10.5k . If your account balance dips to $94.5k ($105k-$10.5k) then you stop yourself out and don’t resume trading till March the first.
Having monthly calendar breaks is nice for another reason. Say you made a load of money in January. You don’t want to start February feeling you are up 5% or it is too tempting to avoid trading all month and protect the existing win. Each month and each year should feel like a clean slate and an independent period.
Everyone has trading slumps. It is perfectly normal. It will definitely happen to you at some stage. The trick is to take a break and refocus. Conserve your capital by not trading a lot whilst you are on a losing streak. This period will be much harder for you emotionally and you’ll end up making suboptimal decisions. An enforced break will help you see the bigger picture.
Put in place a process before you start trading and then it’ll be easy to follow and will feel much less emotional. Remember: the market doesn’t care if you win or lose, it is nothing personal.
When your head has cooled and you feel calm you return the next month and begin the task of building back your account balance.

That's a wrap on risk management

Thanks for taking time to read this three-part chapter on risk management. I hope you enjoyed it. Do comment in the replies if you have any questions or feedback.
Remember: the most important part of trading is not making money. It is not losing money. Always start with that principle. I hope these three notes have provided some food for thought on how you might approach risk management and are of practical use to you when trading. Avoiding mistakes is not a sexy tagline but it is an effective and reliable way to improve results.
Next up I will be writing about an exciting topic I think many traders should look at rather differently: news trading. Please follow on here to receive notifications and the broad outline is below.
News Trading Part I
  • Introduction
  • Why use the economic calendar
  • Reading the economic calendar
  • Knowing what's priced in
  • Surveys
  • Interest rates
  • First order thinking vs second order thinking
News Trading Part II
  • Preparing for quantitative and qualitative releases
  • Data surprise index
  • Using recent events to predict future reactions
  • Buy the rumour, sell the fact
  • The mysterious 'position trim' effect
  • Reversals
  • Some key FX releases
***

Disclaimer:This content is not investment advice and you should not place any reliance on it. The views expressed are the author's own and should not be attributed to any other person, including their employer.
submitted by getmrmarket to Forex [link] [comments]

Former investment bank FX trader: news trading and second order thinking

Former investment bank FX trader: news trading and second order thinking
Thanks to everyone who responded to the previous pieces on risk management. We ended up with nearly 2,000 upvotes and I'm delighted so many of you found it useful.
This time we're going to focus on a new area: reacting to and trading around news and fundamental developments.
A lot of people get this totally wrong and the main reason is that they trade the news at face value, without considering what the market had already priced in. If you've ever seen what you consider to be "good" or "better than forecast" news come out and yet been confused as the pair did nothing or moved in the opposite direction to expected, read on...
We are going to do this in two parts.
Part I
  • Introduction
  • Why use an economic calendar
  • How to read the calendar
  • Knowing what's priced in
  • Surveys
  • Rates decisions
  • First order thinking vs second order thinking

Introduction

Knowing how to use and benefit from the economic calendar is key for all traders - not just news traders.
In this chapter we are going to take a practical look at how to use the economic calendar. We are also going to look at how to interpret news using second order thinking.
The key concept is learning what has already been ‘priced in’ by the market so we can estimate how the market price might react to the new information.

Why use an economic calendar

The economic calendar contains all the scheduled economic releases for that day and week. Even if you purely trade based on technical analysis, you still must know what is in store.

https://preview.redd.it/20xdiq6gq4k51.png?width=1200&format=png&auto=webp&s=6cd47186db1039be7df4d7ad6782de36da48f1db
Why? Three main reasons.
Firstly, releases can help provide direction. They create trends. For example if GBPUSD has been fluctuating aimlessly within a range and suddenly the Bank of England starts raising rates you better believe the British Pound will start to move. Big news events often start long-term trends which you can trade around.
Secondly, a lot of the volatility occurs around these events. This is because these events give the market new information. Prior to a big scheduled release like the US Non Farm Payrolls you might find no one wants to take a big position. After it is released the market may move violently and potentially not just in a single direction - often prices may overshoot and come back down. Even without a trend this volatility provides lots of trading opportunities for the day trader.

https://preview.redd.it/u17iwbhiq4k51.png?width=1200&format=png&auto=webp&s=98ea8ed154c9468cb62037668c38e7387f2435af
Finally, these releases can change trends. Going into a huge release because of a technical indicator makes little sense. Everything could reverse and stop you out in a moment. You need to be aware of which events are likely to influence the positions you have on so you can decide whether to keep the positions or flatten exposure before the binary event for which you have no edge.
Most traders will therefore ‘scan’ the calendar for the week ahead, noting what the big events are and when they will occur. Then you can focus on each day at a time.

Reading the economic calendar


Most calendars show events cut by trading day. Helpfully they adjust the time of each release to your own timezone. For example we can see that the Bank of Japan Interest Rate decision is happening at 4am local time for this particular London-based trader.

https://preview.redd.it/lmx0q9qoq4k51.jpg?width=1200&format=pjpg&auto=webp&s=c6e9e1533b1ba236e51296de8db3be55dfa78ba1

Note that some events do not happen at a specific time. Think of a Central Banker’s speech for example - this can go on for an hour. It is not like an economic statistic that gets released at a precise time. Clicking the finger emoji will open up additional information on each event.

Event importance

How do you define importance? Well, some events are always unimportant. With the greatest of respect to Italian farmers, nobody cares about mundane releases like Italian farm productivity figures.
Other events always seem to be important. That means, markets consistently react to them and prices move. Interest rate decisions are an example of consistently high importance events.
So the Medium and High can be thought of as guides to how much each event typically affects markets. They are not perfect guides, however, as different events are more or less important depending on the circumstances.
For example, imagine the UK economy was undergoing a consumer-led recovery. The Central Bank has said it would raise interest rates (making GBPUSD move higher) if they feel the consumer is confident.
Consumer confidence data would suddenly become an extremely important event. At other times, when the Central Bank has not said it is focused on the consumer, this release might be near irrelevant.

Knowing what's priced in

Next to each piece of economic data you can normally see three figures. Actual, Forecast, and Previous.
  • Actual refers to the number as it is released.
  • Forecast refers to the consensus estimate from analysts.
  • Previous is what it was last time.
We are going to look at this in a bit more detail later but what you care about is when numbers are better or worse than expected. Whether a number is ‘good’ or ‘bad’ really does not matter much. Yes, really.

Once you understand that markets move based on the news vs expectations, you will be less confused by price action around events

This is a common misunderstanding. Say everyone is expecting ‘great’ economic data and it comes out as ‘good’. Does the price go up?
You might think it should. After all, the economic data was good. However, everyone expected it to be great and it was just … good. The great release was ‘priced in’ by the market already. Most likely the price will be disappointed and go down.
By priced in we simply mean that the market expected it and already bought or sold. The information was already in the price before the announcement.
Incidentally the official forecasts can be pretty stale and might not accurately capture what active traders in the market expect. See the following example.

An example of pricing in

For example, let’s say the market is focused on the number of Tesla deliveries. Analysts think it’ll be 100,000 this quarter. But Elon Musk tweets something that hints he’s really, really, really looking forward to the analyst call. Tesla’s price ticks higher after the tweet as traders put on positions, reflecting the sentiment that Tesla is likely to massively beat the 100,000. (This example is not a real one - it just serves to illustrate the concept.)

Tesla deliveries are up hugely vs last quarter ... but they are disappointing vs market expectations ... what do you think will happen to the stock?

On the day it turns out Tesla hit 101,000. A better than the officially forecasted result - sure - but only marginally. Way below what readers of Musk's twitter account might have thought. Disappointed traders may sell their longs and close out the positions. The stock might go down on ‘good’ results because the market had priced in something even better. (This example is not a real one - it just serves to illustrate the concept.)

Surveys

It can be a little hard to know what the market really expects. Often the published forecasts are stale and do not reflect what actual traders and investors are looking for.
One of the most effective ways is a simple survey of investors. Something like a Twitter poll like this one from CNBC is freely available and not a bad barometer.
CNBC, Bloomberg and other business TV stations often have polls on their Twitter accounts that let you know what others are expecting

Interest rates decisions

We know that interest rates heavily affect currency prices.
For major interest rate decisions there’s a great tool on the CME’s website that you can use.

See the link for a demo

This gives you a % probability of each interest rate level, implied by traded prices in the bond futures market. For example, in the case above the market thinks there’s a 20% chance the Fed will cut rates to 75-100bp.
Obviously this is far more accurate than analyst estimates because it uses actual bond prices where market participants are directly taking risk and placing bets. It basically looks at what interest rate traders are willing to lend at just before/after the date of the central bank meeting to imply the odds that the market ascribes to a change on that date.
Always try to estimate what the market has priced in. That way you have some context for whether the release really was better or worse than expected.

Second order thinking

You have to know what the market expects to try and guess how it’ll react. This is referred to by Howard Marks of Oaktree as second-level thinking. His explanation is so clear I am going to quote extensively.
It really is hard to improve on this clarity of thought:
First-level thinking is simplistic and superficial, and just about everyone can do it (a bad sign for anything involving an attempt at superiority). All the first-level thinker needs is an opinion about the future, as in “The outlook for the company is favorable, meaning the stock will go up.” Second-level thinking is deep, complex and convoluted.
Howard Marks
He explains first-level thinking:
The first-level thinker simply looks for the highest quality company, the best product, the fastest earnings growth or the lowest p/e ratio. He’s ignorant of the very existence of a second level at which to think, and of the need to pursue it.
Howard Marks
The above describes the guy who sees a 101,000 result and buys Tesla stock because - hey, this beat expectations. Marks goes on to describe second-level thinking:
The second-level thinker goes through a much more complex process when thinking about buying an asset. Is it good? Do others think it’s as good as I think it is? Is it really as good as I think it is? Is it as good as others think it is? Is it as good as others think others think it is? How will it change? How do others think it will change? How is it priced given: its current condition; how do I think its conditions will change; how others think it will change; and how others think others think it will change? And that’s just the beginning. No, this isn’t easy.
Howard Marks
In this version of events you are always thinking about the market’s response to Tesla results.
What do you think they’ll announce? What has the market priced in? Is Musk reliable? Are the people who bought because of his tweet likely to hold on if he disappoints or exit immediately? If it goes up at which price will they take profit? How big a number is now considered ‘wow’ by the market?
As Marks says: not easy. However, you need to start getting into the habit of thinking like this if you want to beat the market. You can make gameplans in advance for various scenarios.
Here are some examples from Marks to illustrate the difference between first order and second order thinking.

Some further examples
Trying to react fast to headlines is impossible in today’s market of ultra fast computers. You will never win on speed. Therefore you have to out-think the average participant.

Coming up in part II

Now that we have a basic understanding of concepts such as expectations and what the market has priced in, we can look at some interesting trading techniques and tools.
Part II
  • Preparing for quantitative and qualitative releases
  • Data surprise index
  • Using recent events to predict future reactions
  • Buy the rumour, sell the fact
  • The trimming position effect
  • Reversals
  • Some key FX releases
Hope you enjoyed this note. As always, please reply with any questions/feedback - it is fun to hear from you.
***
Disclaimer:This content is not investment advice and you should not place any reliance on it. The views expressed are the author's own and should not be attributed to any other person, including their employer.
submitted by getmrmarket to Forex [link] [comments]

Your Pre Market Brief for 07/16/2020

Pre Market Brief for Thursday July 16th 2020

You can subscribe to the daily 4:00 AM Pre Market Brief on The Twitter Link Here . Alerts in the tweets will direct you to the daily 4:00 AM Pre Market Brief in this sub.
Updated as of 4:45 AM EST
-----------------------------------------------
Stock Futures:
Wednesday 07/15/2020 News and Markets Recap:
Thursday July 16th 2020 Economic Calendar (All times are in EST)
(JOBLESS CLAIMS TODAY)
News Heading into Thursday July 16th 2020:
NOTE: I USUALLY (TRY TO) POST MANY OF THE MOST PROMISING, DRAMATIC, OR BAD NEWS OVERNIGHT STORIES THAT ARE LIKELY IMPORTANT TO THE MEMBERS OF THIS SUB AT THE TOP OF THIS LIST. PLEASE DO NOT YOLO THE VARIOUS TICKERS WITHOUT DOING RESEARCH! THE TIME STAMPS ON THESE MAY BE LATER THAN OTHERS ON THE WEB.
Upcoming Earnings:
Commodities:
COVID-19 Stats and News:
Macro Considerations:
Most Recent SEC Filings
Other
-----------------------------------------------
Morning Research and Trading Prep Tool Kit
Other Useful Resources:
The Ultimate Quick Resource For the Amateur Trader.
Subscribe to This Brief and the daily 4:00 AM Pre Market Brief on The Twitter Link Here . Alerts in the tweets will direct you to the daily brief in this sub
submitted by Cicero1982 to pennystocks [link] [comments]

Forex Trading Strategies Reddit: What you need to know to start Forex trading.

Forex Trading Strategies Reddit: What you need to know to start Forex trading.

FOREX Strategies

What are FOREX Strategies?
https://preview.redd.it/ihmphstzguv51.jpg?width=960&format=pjpg&auto=webp&s=81f6b73c367d8695605514f8d32aaf3e2aeabc6e
You may have noticed that most of people confuse the terminology and refer to FOREX Strategies in the wrong way. There are methodologies, systems, strategies, and techniques. The most effective methodology is Price Language (Trend Tracking). Combined with a correct reading of mass psychology presented by the charts.
We know that in the Stock Markets there are thousands of strategies. FOREX, like the rest of the markets, presents you with the opportunity to apply similar strategies to win consistently. Taking advantage of repetitive psychological patterns.
First, the Price Language methodology has created great fortunes in FOREX, and the next fortune may be yours. But this methodology must be implemented within a framework of advanced concepts of Markets. Without forgetting the basics. And working hard day by day.
Second, a strategy is a set of parameters and techniques that together give you the advantage to act in any situation. Thus for example in war, generals have attack strategies and counterattack strategies.
FOREX strategies alike are entry strategies and exit strategies. All beginners should know these FOREX strategies for beginners. That way you will get a general idea of ​​the game and understand that trading is a war against the Market and its Specialists. Only applying FOREX strategies revealed by the same Specialists and using their own techniques,
... you can survive in this war.
Do not fall into the trap of the many "systems" and "methods" that are offered on the internet about operating in the FOREX Market. They just don't work in the long run. They are strategies based on indicators for the most part. Using rigid parameters. That if they can work and give profitability during a certain period of time, they will always reach a breaking point when the market changes its dynamics.
Instead, take advantage of your precious time and learn the Language of Price or Price Action.
The Language methodology will allow you to adapt to each new phase of the Market. If you combine this knowledge with the appropriate psychological concepts, you can live comfortably from speculation in FOREX.

Forex Trading Strategies Reddit - Basic FOREX Strategies

You have two basic FOREX strategies, one entry, and one exit. Both follow a general strategy that helps you capitalize on the collective behaviors of the Market. That is, of the total of participating speculators.
This behavior causes the formation of cycles that repeat over and over again. Driven by the basic emotions (uncertainty, greed, and panic) of the speculators involved that can be taken advantage of with the aforementioned FOREX strategies. Specialists identify these emotions in the order flow and capitalize on these events every hour, every day, and every month.
Basic FOREX Strategies - The Price Cycle
These repetitive cycles consist of 4 phases:
  1. Accumulation
  2. Upward trend
  3. Distribution
  4. Downward trend
https://preview.redd.it/6dvk2w0pduv51.png?width=300&format=png&auto=webp&s=a3ab65ca4eab6d20174b3327b862d8b59dcc13b7
The two trends can be easily identified by their notorious breakdown. And the two areas of uncertainty (accumulation and distribution), due to their notorious range trajectories.
This general behavior determines the core of our FOREX strategies.
You buy when the price of a pair has broken and has come out of one of its congestion formations (accumulation or distribution). You implement one of the Forex strategies, in this case, the entry one.
The multi-time technique will help you find the point of least risk when entering your initial buy or sell order. In the same way and using the same strategy but this time to close your position, the multiple timing technique will also show you how to close your operation obtaining the highest possible profit.
The most consistent way to extract profits in the market is by trading the start of trends within a cycle . Once confirmed by their respective breaks from the areas of uncertainty. This is the mother of all FOREX strategies . And in a market that operates 24 hours, we have more frequent cycles and therefore more opportunities.

Forex Trading Strategies Reddit - Advanced Forex Strategies

There are many advanced FOREX strategies that are generally used by professional speculators working for large financial firms.
Among these firms are banks, Investment Fund managers and Hedge Fund managers. The latter is an investment modality similar to Investment Funds, with the difference that Hedge Funds use more complex investment strategies. Its operations are more oriented to aggressive speculations in the short and medium-term.
Among the most common strategies is hedging (hedging), carry trade, automated systems based on quantum mathematics. And a large number of combinations between the different option strategies.

The Carry Trade

The central idea of ​​Carry Trade is to buy a pair in which the base currency has a considerably higher interest rate than the quoted currency. To earn the difference in rates regardless of whether the price of the pair rises or falls.
Suppose we buy a $ 100,000 lot of AUDJPY, which according to the rates on the chart would turn out to be the ideal instrument in this example to use the Forex carry trade strategy.
As our capital is in US dollars we have to assume for our example, the following quotes necessary to perform the place calculations:
AUD / JPY = 80.00 USD / JPY = 85.00
What happens internally in your broker is this.
  1. By placing as collateral $ 1,000 of your $ 50,000 of capital (assumed for this example), deposited in your account, you have access to $ 100,000 virtual (this is what is known as leverage); that is, you put in $ 1,000 and your broker lends you 99,000.
  2. With those $ 100,000 virtual dollars, your broker borrows on your behalf ¥ 8,500,000 Japanese yen (85 × 100,000) at 0.1% annual interest from a Japanese bank.
  3. With those ¥ 8,500,000 Japanese yen, your broker buys A $ 106,250 Australian dollars (8,500,000 / 80) and deposits it in an Australian bank where it receives 4.5% annual interest on your behalf.
  4. One year later (and regardless of the profit or loss generated by the pair's movement), your profit will be the difference between the AUD rate and the JPY rate, that is:
Profit = (AUD rate) - (JPY rate) - (costs of the 2 currency exchanges) Profit = (4.5%) - (0.1%) - (0.1% to 1%)
The great advantage of carry trade FOREX strategies is that this percentage profit is applied to the $ 100,000 of the standard lot; the broker transfers all of the profit to you, even if you only contributed $ 1,000. On the other hand, if you carry out the inverse of this operation, this benefit of the Forex carry trade becomes a cost (swap), and you assume it completely.
Remember that FOREX carry trade strategies are recommended for pairs with considerable interest rate differences, such as the one we have just seen in our example.
These FOREX strategies should also not be used in isolation. The idea is that through technical analysis you identify when would be the ideal time to enter the market using your carry trade Forex strategy and multiply your profits considerably.

What FOREX Strategies Do Hedge Funds Use?

The FOREX strategies used by large fund managers do not constitute an advantage in terms of percentage results for them, nor do they constitute a competitive disadvantage for you.
The vast majority of them fail because of their big egos. In fact, there was a firm made up of great financial geniuses, including 2 winners of the Nobel Prize in Economics, who developed a strategy based on quantum mathematical calculations.
With an initial base capital of about 3 billion dollars, and after 3 successful years obtaining annual returns of over 40%, the firm Long-Term Capital Management, begins its fourth year with losses. To counteract these losses the geniuses decide to multiply the initial capital several times, while the losses continued.
The year closed with the bankruptcy of the fund, and with a total accumulated loss of 1 trillion dollars, due to the great leverage used. And all for not admitting that the FOREX Strategies of Long Term Capital Management were not in line with the dynamics of the Market.
There are an overwhelming number of opportunities in the stock markets to make money interpreting the Language of Price.
You don't need to use complex "advanced" strategies that have been created to handle hundreds or billions of dollars.
The reasons for using these FOREX strategies are very different from what a "retail trader" pursues with his small speculation business.
As you can see, you should not worry about wanting to integrate any of these advanced strategies into your arsenal. They are only beneficial for managing hundreds or billions of dollars, where the return parameters are very different when you handle small amounts of capital.
Do not worry about collecting hundreds of free FOREX strategies that circulate on the internet, that great accumulation of mediocre information will only serve to confuse you and waste your valuable time.
Spend that time learning Price Action,
… And you will always be one step behind the Specialists, identifying each new Market condition, and anticipating the vast majority of reversals of all prices.
Ironically, the most successful fund managers indicate that their most profitable trades are those based on the basic trend-following strategies of the Price Language. The same ones that you will learn in this Free Course.
Dedicate yourself to perfecting them and believe me you won't need anything else. As long as you have good risk management, taking into consideration the following points ...

Styles of Investments in FOREX

The Investment FOREX long term is not recommended for small investors like you and me. If we take into account the term investing literally as large investors do who buy a financial product today to sell it years later.
We both have a better niche in the short and medium-term.
You may have noticed that the big multi-year trends in the Forex Market do exist. But minor swings within a big trend are usually very wide.
These minor movements allow us to easily double and triple the annual return of the big general trend, motivating most traders to speculate in the short and medium-term.
These minor oscillations or trends that occur within the large multi-year trends owe their occurrence mainly to two reasons.
First, the FOREX Market presents 3 sessions a day each in different cities of the world with different time zones (Asia, Europe, and America). This causes more frequent trend changes than in the rest of the stock markets.
Second, the purpose for which it was created also plays a role. The modern Foreign Exchange Market, since its inception in 1972, was conceived by the global financial system as a tool for speculation. To obtain benefits in the short and medium-term (from several days to 1 year).
These two points are basically the reasons why we observe the immense speed with which the FOREX market changes trends.
For example, for those who live in America, in the early morning (Europe) the EURUSD pair may be on the rise, in the morning or afternoon (America) it may be down, and then finally at night (Asia) it may return to the rise.

Define your Own Style for your FOREX Investments

One of the first decisions you will have to make is to choose your style as a trader or investor.
There are 4 types of well-defined styles.
Most professional traders tend to have multiple styles, although they always identify with one primary style for their FOREX investments. Study the characteristics of the 4 main styles to make your investments in FOREX :
1. Long Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per month to their investments in Forex. The period of an open position ranges from 1 year to 5 years.
2. Medium Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per week to their investments in Forex. The period of an open position ranges from 1 month to 1 year.
3. Short Term: recommended for anyone who is going to enter the market for the first time, or who already has a certain time operating in the long and medium-term, showing constant profits, and who can dedicate a minimum of one hour per day to your investments in FOREX. The period of an open position ranges from 1 day to 1 month.
4. Intraday : recommended only for people with a fairly solid earnings record in the short term, and with a capital greater than $ 50,000. As we have noted, this option constitutes a full-time job.
People who start investing in FOREX , should start executing short-term (weeks) and medium-term (months) transactions only, and not pay attention to intraday oscillations (day trading).
If you are interested in being an intraday speculator, I recommend that you first exhaust at least a year doing operations in the short and medium-term to assimilate the correct strategies and to develop the necessary mentality to carry out this work.
The second option would be to participate in some kind of intensive training.
I remind you that self-educating is almost impossible in speculation. You are likely to accumulate a lot of knowledge by reading books and attending courses. But you will probably never learn to make money with all the incomplete "systems" circulating on the internet.

Mistakes to Avoid When Looking for Your Style

Many people who are new to FOREX investments make the mistake of combining these styles, which is a key to failure.
I recommend that if you are not getting the results you expected by adopting one of these styles, do not try to change it. The problem sure is not in the style, but in your strategies or in your psychology.
A successful investor is able to make a profit in any longer trading time than he is used to. I explain. If you are already a profitable operator in the short term, it is very likely that you will also be profitable in the medium and long term,
… As long as you can interpret the Language of Price or Price Action.
In the opposite case, the same would not happen. If you were a medium-term trader, you would need time to adjust to the intraday. The reality is that long, medium and short term traders have very similar personalities. The intraday trader is completely different.

The Myth of the Intraday in Investments in FOREX

If you are already successful in the short, medium and long term, you will notice that the sacrifice and the hours necessary in front of the computer to operate intraday is much greater. The intraday style will be useful to increase your account if it is less than USD $ 100,000 in a very short time in exchange for 8 to 12 hours a day of hard work but ...
You must first develop the necessary skills to operate the intraday.
The ideal is to combine all the styles to get more out of the Market and carry out more effective transactions and have a diversification in your investments in FOREX.
There are intraday traders that are very successful, but the reality is that there are very few in the world that make a profit year after year. If you want to become an intraday, you just have to prepare yourself properly through intensive training.
Otherwise, I recommend that you don't even think about educating yourself to adopt the intraday style. It is not necessary to go against a probability of failure greater than 99%. Unless
... your ego is greater than your common sense.
The main reason why this style of investments in FOREX is not recommended for the vast majority of us "retail investors" (the official term "retail traders"), is the high operational cost.
The real commissions in this market range between $ 2.0 and $ 2.50 for each lot of 100,000 virtual units. This means that a complete operation (opening and closing) is approximately $ 5.00, for each standard lot traded ($ 100,000 virtual).
Another fundamental reason is the advent of robotic traders (HFT = High-Frequency Trading), which tend to manipulate the market in the shorter intraday swings. Please do not confuse HFTs with automated systems that we find daily on the internet, and that can be purchased for a few hundred dollars and often for free on FOREX forums / groups.
These HFTs to which I refer, they are effective. They cost millions of dollars and have been developed by the large Wall Street financial firms to manage their investments in FOREX.
The reality of the intraday trader is that you execute orders for large lots at the same time, to profit from the smallest movements in the market. It is an activity based on reflexes. The slightest oversight or distraction can turn into a catastrophe for your FOREX investments.
I recommend that you start investing in FOREX using slow time periods such as H4 or Daily. For some reason, all Goldman Sachs intraday FOREX investments are made with algorithms.

Finally…

To choose your style as a trader and manage your investments in FOREX, first determine what your degree of experience is, analyze the points mentioned below and the rest you will discover when you execute your first operations.
The points that will affect your decision are:
  • Capital
  • Time available each day
  • Level of Experience
  • Personality
Discovering your style is a search process. For some it will be a long way to find the right time frame that matches their personality. Don't be put off by the falls. After all, those who continue the path despite the falls are the ones who reach the destination.
And I hope you are one of those who get up over and over again. The next lesson will boost your confidence when you discover the main reason that moves currencies ...

Fundamental Analysis in Forex Trading Reddit

The fundamental analysis in Forex is used mostly by long-term investors. Players as we saw in the styles of operators, start a negotiation today, to close it years later.
I always emphasize the importance that the mass media give to this type of analysis to distract the great mass of participants.
It is all part of a great mass psychological manipulation. For centuries the ignorance of the masses has been organized before the great movements begin.
The important news are the macroeconomic reports published by the Central Banks and other government agencies destined for this work. All reports are made up. 99% of them are corrected months later.
These events are tools to justify fundamental analysis and price cleaning movements. Any silly headline does the job. With this, it is possible to absorb most of the existing liquidity, before the new trend phase is projected.

Reaction!

Except in rare situations, the result of an economic report of the fundamental analysis is generally already assimilated in the graph. In most cases, there are financial institutions that already have access to this information and are organizing and carrying out their operations in advance.
The phrase buy the rumor and sell the news is a very old adage on Wall Street. And its meaning contains what we have just explained. For the investor who can interpret the Language of Price, fundamental analysis is of little importance. Well, in general, their disclosure does not indicate that you have to take any action in your open trades , as long as your entry strategy provides you with a good support cushion.
This reality of fundamental analysis causes a lot of confusion for investors who lack in-depth knowledge of the forex market.

Macroeconomic Data

The data published in these events is irrelevant. Both for speculators and for the people in general. They are false. They lack reliability.
The price can go up or down with the same result of the data. The main ones are:
- Interest Rates - GDP (gross domestic product) - CPI (inflation) - ISM (manufacturing index) - NFP (payroll) - Double Deficits (deficit = fiscal + balance of payments)
If you are initiated, I recommend you avoid operating near these events. It is only a matter of having the time pending. Use the economic calendar for Fundamental Analysis of Forex Factory.
There is a probabilistic advantage in operating these fundamental analysis events. But it takes preparation, experience, and practice. They represent a way of diversifying in the general operation of a speculator.

The Uncertainty of Fundamental Analysis

On many occasions after the disclosure of an economic report, the price movement of the currency pair that is going to be affected tends to move in the opposite direction to the logic of the report.
I show you an example of a fundamental analysis report. Imagine that the EUR / USD pair is trading at 1.2500, and the FED (US Federal Reserve) issues a statement announcing that it has just raised inter-bank interest rates from 0.25 points to 0.75 points. Very positive news for the US dollar that logically implies an appreciation of the currency and consequently an instantaneous collapse of the EUR / USD pair (up the dollar and down the euro)
However, minutes after the release of said fundamental analysis report, the pair after effectively collapsing to 1.2400, returns and returns to its levels prior to the report (1.2500). This situation is very common , but it is not so easy to identify it when it is occurring, but after the damage is done.
Traps like these devour the accounts of beginners who approach the market with little experience, with weak strategies, and especially with very little experience.
That is why I reiterate that you forget the fundamental analysis for now. Just keep in mind when operating, that there is no publication scheduled nearby. Just check the economic calendar for the day and forget about the numbers. Let the economists mess around with the data.

FOREX Market Correlation

The Forex market correlation exists between pairs with similar "base" currencies and not always under the same circumstances. The correlation in the Forex market that is most followed and that has the greatest impact on fundamental analysis is that of the US dollar (USD).
The USD is the most traded monetary unit with a volume greater than 80% with respect to the rest of the currencies. This fact determines why their correlation is the most important, the most followed, and perhaps the only one worth following in the fundamental macro analysis.
The 7 major pairs are usually in sync . These 7 pairs all include the USD and present a fundamental analysis correlation almost 75% of the time. Influencing the rest of the currency pairs.

Advantages of the FOREX Market Correlation

In the fundamental analysis the most basic FOREX correlation is the following. When the USD appreciates, the USD / CAD, USD / CHF, and USD / JPY pairs tend to go up in price. This indicates that the Canadian dollar (CAD), the Swiss franc (CHF), and the Japanese yen (JPY) are losing value against the USD.
We must bear in mind that this correlation does not occur 100% of the time. In fact, the JPY generally tends to move in the opposite direction , since in recent decades this currency has been used as a source of financing to invest in other financial instruments.
On the other side is the FOREX market correlation that generates a movement almost in unison in the other 4 major pairs EUR / USD, GBP / USD, AUD / USD, and NZD / USD. These tend to fall in price, homologous the appreciation of the USD. But not always.
In this case the fundamental analysis correlation works most of the time, between 65 and 85% of the time. Small differences are noted in the extent that each of these pairs experiences.
There is also a correlation in the secondary FOREX market, where the pairs of all currencies that do not include the USD participate, but I recommend you not to waste time on them for now. There are more important things about the Language of Price to know first.

FOREX Commodity Correlation

In this part I will explain to you in a basic way the Correlation Commodities - FOREX of the fundamental analysis.
There are three currencies that have a direct correlation with commodities. They are usually called: "COMDOLLS" which is short for "Commodities Dollars" (Commodities Dollars), since all three obey the dollar denomination. These are:
- The New Zealand Dollar (NZD) - The Australian Dollar (AUD) - The Canadian Dollar (CAD)
These three currencies make up the group of the 8 largest together with the euro, the pound, the yen, the franc and the US dollar. Together, they merge to produce the major pairs traded in the FOREX Foreign Exchange Market.
The FOREX Commodity Correlation has an affinity in most cases greater than 75%. And each of them has its different raw material of correlation. You will notice that the NZD and the AUD are two currencies that act practically in unison. Both present minimal discrepancies in their fluctuations in the short, medium and long term.
This is mainly because their economies are very similar and their economic and fiscal policies are too. Their main production items also show great similarities, despite the fact that the Australian economy is much larger than the New Zealand economy.
The raw materials that follow the movement of the AUD are mainly gold and copper. If you put the history of these three quotes during the last decade of the year 2,000 together on the same chart, you will notice a very similar upward movement between the three quotes. Pure correlation of fundamental analysis.
This strong correlation with commodities in the metals area for the AUD has provided Australia with an economic advantage enviable over the other major powers that have seen their currencies devalue sharply against the AUD. At the same time, they experience a constant decrease in the purchasing power of their citizens.
The NZD maintains a correlation with raw materials related to agriculture and livestock, mainly including milk and its derivatives. It is one of the countries that dominates the world export of these economic items, and also has important exports of metals , although in smaller quantities than Australia.
Finally, you have a correlation with raw materials in the energy area. For historical reasons the CAD, which is not the largest oil producer in the world, but an important supplier to the largest consumer that is the US, has seen its currency oscillate in line with oil prices.
To make long-term investments in the Foreign Exchange Market, it is necessary to take into consideration at least one Commodity Correlation - FOREX in your fundamental analysis.

Forex Technical Analysis Reddit

The technical analysis is the methodology that interprets the movements of the price. Specialists look for liquidity to fund their business. The repetition of the strategies used by the specialists in their work generate repetitive patterns.
If you were an analyst, you would develop the visual ability to identify such patterns on a graph. If you were a programmer you would quantify them mathematically using complex formulas.
And if you could learn to interpret the Language of Price, you would have the ability to anticipate 90% of all movements that occur on a chart. And in this business, anticipating is what will make you money.
Market prices are reflected and framed on a horizontal time axis and a vertical price axis. Prices go up or down according to the aggressiveness of the participating operators. In an efficient or balanced market these oscillations should be imperceptible.
But in reality this is not the case, since the Market works thanks to the digital printing of hundreds of billions of units of paper money systematically distributed by the Central Banks through the banking system. These resources serve as a tool to manipulate 100% of the movements that occur in the FOREX Market.
Are you looking for Technical Indicators? All technical indicators were created from the 70's. How do you think that for more than 200 years the speculators of the past accumulated great wealth?
With the Language of Price. The best timing is given by the price itself. Indicator-generated entry signals usually occur at the wrong time.
The basis of technical analysis is human psychology. Unfortunately, human beings are not perfect and are loaded with emotions that dominate their behavior in similar situations, creating repetitive and highly predictable behavior when it occurs in masses.
The study of technical analysis through indicators and subjective training, originates and shapes the collective thinking on which all the traps that specialists execute every day to maintain their business are designed. If the majority won, the Market would cease to exist.
Although you already know that the patterns are not generated by the masses , but the repetitive behavior of the Specialists in the face of the action response of the masses. It is very easy for speculaists, because they can see everyone's orders in their books.
And they also exert a great influence on the decisions of the masses through the mass media. It is what I call the war between the Egg and the Stone , if you hit me you win and if I hit you also you win.

The Deception of Modern Technical Analysis

Through the centuries thousands of people have been able to extract great benefits from the financial markets by applying the basic strategies of technical analysis and the psychology of the Price Language.
More than 200 years ago when the markets began to operate officially, fundamental analysis predominated, which was only used by large financial institutions. As this analysis tool began to become popular, these institutions began to apply the strategies of technical analysis.
In recent decades and with the massification of internet technology, technical analysis has begun to be handled by anyone who has a computer with internet access. The same financial institutions, which have been present for more than a century and as a result of this overcrowding , establish a strategy to confuse and misinform about the true strategies of technical analysis.
This has been accomplished in the following manner. Currently there are hundreds, if not thousands of technical indicators that have been developed by so-called "gurus" of technical analysis and that sell their magic indicators packed in a "system" or "method" that usually cost thousands of dollars, or simply with the publication of a book with which they generate large profits. Double benefit.
The aim is to confuse the initiates in speculation and create the collective mentality that will originate the same behaviors over and over again. About 95% of these new entrants completely lose all the capital they invest in their early stages as investors.
Leaving them with a negative experience and creating the idea and the image that financial markets are an exclusive area for geniuses with high academic levels and that only they can produce returns in the markets year after year.
The initiate, having lost all his original capital, turns to these “gurus” for help and teachings. You spend more capital on the products they offer you and the cycle repeats itself . Obviously, the vast majority do not relapse and completely forget to re-engage in the stock markets.
I hope you have not been a victim of this drama.
Now I will show you the simplicity of a FOREX technical analysis , without the need to resort to any indicator as a tool to determine an effective entry or exit strategy when planning your operations.

The Price Cycle

Previously you studied in the FOREX strategies lesson, that the typical price cycle when it is reflected in a graph, presents four very specific phases and very easy to identify if you perform a technical analysis with common sense . These are:
  • Accumulation
  • Bullish trend
  • Distribution
  • Bearish trend
Remember also that the most effective way to constantly extract profits in the markets is by taking advantage of phases 2 and 4 (the trends). Combined with a correct reading of the collective behavior of the masses of speculators interpreting the Language of Price.
You will be surprised by the simplicity with which thousands of people around the world and over the centuries have accumulated large sums of money by drawing a few simple lines and applying responsible risk management with their capital.

How to Identify Trends?

Being able to determine the trend phases within the price cycle is the essence of technical analysis since it is these two phases that provide you with the probabilistic advantage you need to operate in the markets and obtain constant returns.
In the most plain and simple language, in the world of technical analysis, there are only two types of formations: trends and ranges.
The trends, in turn, can be bullish if they go up, or bearish if they go down. The ranges, on the other hand, can be accumulation if they are at the beginning of the cycle, or distribution if they are in the high part of the cycle. As I had indicated in the topic of FOREX strategies when describing the price cycle.
This sounds more like a play on words, but I will show you the practical definition to simplify your life and then you will apply these definitions on the graph so that everything makes more sense to you.
  • Bullish trend: a succession of major highs and major lows
  • Bearish trend: a succession of minor highs and minor lows
  • Floor Range: equal highs and varied lows
  • Ceiling Range: equal minimums and varied maximums
https://preview.redd.it/vvmsshf0guv51.png?width=600&format=png&auto=webp&s=c321679a7dcc03f7184778be86379ef442fddf91
Some key points from the graph:
  • The start of this big uptrend was detected when the last high (thick green line) of the previous downtrend was broken to the upside, ending the succession of lower highs, while exiting the lateral floor formation.
  • The succession of major lows in the uptrend (thin blue lines)
  • The succession of major highs in the uptrend (thin green lines)
  • The end of the uptrend was detected when the last low (thick blue line) of the uptrend was broken to the downside, ending the succession of higher lows, while exiting the lateral ceiling formation.
A tool that will help you sharpen your technical eye and identify trends on the chart is the Currency Scanner. This application is very effective and will provide you with a much-needed boost in your operations to identify reliable trends. At first, we are not sure how reliable a trend is. You will receive great help to find opportunities with the Currency Scanner .

The Common Sense, The Less Common of Senses

The central idea of ​​technical analysis consists in determining the price situation of a market, that is, in which phase of the pattern of its cycle it is currently conjugated with the collective thinking of the masses and the possible traps that the market would have prepared to remove. the capital at stake by the public.
To carry out a precise technical analysis, you will use the support and resistance lines, which can be static (horizontal) or dynamic (projecting an angle with respect to the horizontal axis).
Your common sense prevails here.
If you show a 10-year-old a chart, they will be able to tell you if the price is going up or down. You will most likely have no idea how to draw the lines, but you will be able to establish the general trend. Simply using your common sense.
By introducing indicators and other gadgets , the simplicity and effectiveness of the technical analysis created by your common sense evaporates.
The following graph conceptually shows you all the possible situations in which you could draw these lines to carry out your technical analysis of the place. You can clearly observe a downtrend delimited by its dynamic trend line and an uptrend on the right side with its respective dynamic delimitation.
https://preview.redd.it/5iehg0r6guv51.png?width=500&format=png&auto=webp&s=84c265a5d35da7ea970792c4bf40fe20b33bd8bd

Forex Charts Analysis

I want to remind you that the formations or patterns that develop on the charts (triangles, wedges, pennants, boxes, etc.) only work to execute trades that have initially been confirmed by the static support and resistance lines and to read the collective thinking of the masses.
Chart formations work, but you must know the Language of Price to determine when the Specialists will exploit a chartist figure, or when they will allow it to run. In fact, you will learn with the Language that you can operate a chart figure in any direction.
Much of the "mentalization" that the masses receive is to believe that the figures are made to be respected. Which is an inefficient way of working. Simply because you could wait days or months for a perfect chart figure to occur in order to perform a reliable trade. When in fact there are dozens every day.

Japanese Candles

Of all the tools you have to carry out technical analysis, perhaps the best known and most popular is the Japanese technique of candles (candlesticks).
Candles are mainly used to identify reversal points on the chart without resorting to confirmation of horizontal trend lines and only using a previous bar or candle breaks.
Its correct use is subject to a multi-time analysis (multiple temporalities) and a general evaluation of the context proposed by the market in general at the time of each scenario.
Later I will show you all the important details to take into account so that you use Japanese candles in a simple and very effective way.
Do not forget ... Trading in your beginnings based on formations (chartism) and candlestick patterns conjugated with hundreds of tools and technical indicators, constitutes the perfect path to your failure. Before using any strategy or technique I recommend you focus on learning the Price Language, which includes 3 basic things:
  • The Price: structure and dynamics
  • Market sentiment: relative strength, external shocks, etc.
  • Psychology: flexible mindset and risk acceptance
After you acquire this solid foundation, I guarantee that you will be able to trade any trading system that exists, any strategy, technique or chart figure in a profitable and consistent manner.
Specialists make money every day at the expense of the collective behavior caused by the use of these strategies and techniques. With which you will only manage to lose your capital and your time by putting the cart in front of the horse.
People who do the opposite, at best become,
... Philosophers of Speculation, or indocile Robot Assistants or Expert Advisors.
To make money in any market condition, range or trend, you must use the technical analysis based on the Price Language and combine it with a correct psychological reading of the price. This knowledge can only be acquired through proper education and lots of supervised practice. Like any other career in life.
I hope you've found this guide helpful!
submitted by kayakero to makemoneyforexreddit [link] [comments]

THROW YOUR FD's in FDS

Factset: How You can Invest in Hedge Funds’ Biggest Investment
Tl;dr FactSet is the most undervalued widespread SaaS/IT solution stock that exists
If any of you have relevant experience or are friends with people in Investment Banking/other high finance, you know that Factset is the lifeblood of their financial analysis toolkit if and when it’s not Bloomberg, which isn’t even publicly traded. Factset has been around since 1978 and it’s considered a staple like Bloomberg in many wealth management firms, and it offers some of the easiest to access and understandable financial data so many newer firms focused less on trading are switching to Factset because it has a lot of the same data Bloomberg offers for half the cost. When it comes to modern financial data, Factset outcompetes Reuters and arguably Bloomberg as well due to their API services which makes Factset much more preferable for quantitative divisions of banks/hedge funds as API integration with Python/R is the most important factor for vast data lakes of financial data, this suggests Factset will be much more prepared for programming making its way into traditional finance fields. According to Factset, their mission for data delivery is to: “Integrate the data you need with your applications, web portals, and statistical packages. Whether you need market, company, or alternative data, FactSet flexible data delivery services give you normalized data through APIs and a direct delivery of local copies of standard data feeds. Our unique symbology links and aggregates a variety of content sources to ensure consistency, transparency, and data integrity across your business. Build financial models and power customized applications with FactSet APIs in our developer portal”. Their technical focus for their data delivery system alone should make it stand out compared to Bloomberg, whose UI is far more outdated and complex on top of not being as technically developed as Factset’s. Factset is the key provider of buy-side portfolio analysis for IBs, Hedge funds, and Private Equity firms, and it’s making its way into non-quantitative hedge funds as well because quantitative portfolio management makes automation of risk management and the application of portfolio theory so much easier, and to top it off, Factset’s scenario analysis and simulation is unique in its class. Factset also is able to automate trades based on individual manager risk tolerance and ML optimization for Forex trading as well. Not only does Factset provide solutions for financial companies, they are branching out to all corporations now and providing quantitative analytics for them in the areas of “corporate development, M&A, strategy, treasury, financial planning and analysis, and investor relations workflows”. Factset will eventually in my opinion reach out to Insurance Risk Management a lot more in the future as that’s a huge industry which has yet to see much automation of risk management yet, and with the field wide open, Factset will be the first to take advantage without a shadow of a doubt. So let’s dig into the company’s financials now:
Their latest 8k filing reported the following:
Revenue increased 2.6%, or $9.6 million, to $374.1 million compared with $364.5 million for the same period in fiscal 2019. The increase is primarily due to higher sales of analytics, content and technology solutions (CTS) and wealth management solutions.
Annual Subscription Value (ASV) plus professional services was $1.52 billion at May 31, 2020, compared with $1.45 billion at May 31, 2019. The organic growth rate, which excludes the effects of acquisitions, dispositions, and foreign currency movements, was 5.0%. The primary contributors to this growth rate were higher sales in FactSet's wealth and research workflow solutions and a price increase in the Company's international region
Adjusted operating margin improved to 35.5% compared with 34.0% in the prior year period primarily as a result of reduced employee-related operating expenses due to the coronavirus pandemic.
Diluted earnings per share (EPS) increased 11.0% to $2.63 compared with $2.37 for the same period in fiscal 2019.
Adjusted diluted EPS rose 9.2% to $2.86 compared with $2.62 in the prior year period primarily driven by an improvement in operating results.
The Company’s effective tax rate for the third quarter decreased to 15.0% compared with 18.6% a year ago, primarily due to an income tax expense in the prior year related to finalizing the Company's tax returns with no similar event for the three months ended May 31, 2020.
FactSet increased its quarterly dividend by $0.05 per share or 7% to $0.77 marking the fifteenth consecutive year the Company has increased dividends, highlighting its continued commitment to returning value to shareholders.
As you can see, there’s not much of a negative sign in sight here.
It makes sense considering how FactSet’s FCF has never slowed down:
https://preview.redd.it/frmtdk8e9hk51.png?width=276&format=png&auto=webp&s=1c0ff12539e0b2f9dbfda13d0565c5ce2b6f8f1a

https://preview.redd.it/6axdb6lh9hk51.png?width=593&format=png&auto=webp&s=9af1673272a5a2d8df28f60f4707e948a00e5ff1
FactSet’s annual subscriptions and professional services have made its way to foreign and developing markets, and many of them are opting for FactSet’s cheaper services to reduce costs and still get copious amounts of data and models to work with.
Here’s what FactSet had to say regarding its competitive position within the market of providing financial data in its last 10k: “Despite competing products and services, we enjoy high barriers to entry and believe it would be difficult for another vendor to quickly replicate the extensive databases we currently offer. Through our in-depth analytics and client service, we believe we can offer clients a more comprehensive solution with one of the broadest sets of functionalities, through a desktop or mobile user interface or through a standardized or bespoke data feed.” And FactSet is confident that their ML services cannot be replaced by anybody else in the industry either: “In addition, our applications, including our client support and service offerings, are entrenched in the workflow of many financial professionals given the downloading functions and portfolio analysis/screening capabilities offered. We are entrusted with significant amounts of our clients' own proprietary data, including portfolio holdings. As a result, our products have become central to our clients’ investment analysis and decision-making.” (https://last10k.com/sec-filings/fds#link_fullReport), if you read the full report and compare it to the most recent 8K, you’ll find that the real expenses this quarter were far lower than expected by the last 10k as there was a lower than expected tax rate and a 3% increase in expected operating margin from the expected figure as well. The company also reports a 90% customer retention rate over 15 years, so you know that they’re not lying when they say the clients need them for all sorts of financial data whether it’s for M&A or wealth management and Equity analysis:
https://www.investopedia.com/terms/f/factset.asp
https://preview.redd.it/yo71y6qj9hk51.png?width=355&format=png&auto=webp&s=a9414bdaa03c06114ca052304a26fae2773c3e45

FactSet also has remarkably good cash conversion considering it’s a subscription based company, a company structure which usually takes on too much leverage. Speaking of leverage, FDS had taken on a lot of leverage in 2015:

https://preview.redd.it/oxaa1wel9hk51.png?width=443&format=png&auto=webp&s=13d60d2518980360c403364f7150392ab83d07d7
So what’s that about? Why were FactSet’s long term debts at 0 and all of a sudden why’d the spike up? Well usually for a company that’s non-cyclical and has a well-established product (like FactSet) leverage can actually be good at amplifying returns, so FDS used this to their advantage and this was able to help the share’s price during 2015. Also, as you can see debt/ebitda is beginning a rapid decline anyway. This only adds to my theory that FactSet is trying to expand into new playing fields. FactSet obviously didn’t need the leverage to cover their normal costs, because they have always had consistently growing margins and revenue so the debt financing was only for the sake of financing growth. And this debt can be considered covered and paid off, considering the net income growth of 32% between 2018 and 2019 alone and the EPS growth of 33%
https://preview.redd.it/e4trju3p9hk51.png?width=387&format=png&auto=webp&s=6f6bee15f836c47e73121054ec60459f147d353e

EBITDA has virtually been exponential for FactSet for a while because of the bang-for-buck for their well-known product, but now as FactSet ventures into algorithmic trading and corporate development the scope for growth is broadly expanded.
https://preview.redd.it/yl7f58tr9hk51.png?width=489&format=png&auto=webp&s=68906b9ecbcf6d886393c4ff40f81bdecab9e9fd

P/E has declined in the past 2 years, making it a great time to buy.

https://preview.redd.it/4mqw3t4t9hk51.png?width=445&format=png&auto=webp&s=e8d719f4913883b044c4150f11b8732e14797b6d
Increasing ROE despite lowering of leverage post 2016
https://preview.redd.it/lt34avzu9hk51.png?width=441&format=png&auto=webp&s=f3742ed87cd1c2ccb7a3d3ee71ae8c7007313b2b

Mountains of cash have been piling up in the coffers increasing chances of increased dividends for shareholders (imo dividend is too low right now, but increasing it will tempt more investors into it), and on top of that in the last 10k a large buyback expansion program was implemented for $210m worth of shares, which shows how confident they are in the company itself.
https://preview.redd.it/fliirmpx9hk51.png?width=370&format=png&auto=webp&s=1216eddeadb4f84c8f4f48692a2f962ba2f1e848

SGA expense/Gross profit has been declining despite expansion of offices
I’m a bit concerned about the skin in the game leadership has in this company, since very few executives/board members have significant holdings in the company, but the CEO himself is a FactSet veteran, and knows his way around the company. On top of that, Bloomberg remains king for trading and the fixed income security market, and Reuters beats out FactSet here as well. If FactSet really wants to increase cash flow sources, the expansion into insurance and corp dev has to be successful.
Summary: FactSet has a lot of growth still left in its industry which is already fast-growing in and of itself, and it only has more potential at its current valuation. Earnings September 24th should be a massive beat due to investment banking demand and growth plus Hedge fund requirements for data and portfolio management hasn’t gone anywhere and has likely increased due to more market opportunities to buy-in.
Calls have shitty greeks, but if you're ballsy October 450s LOL, I'm holding shares
I’d say it’s a great long term investment, and it should at least be on your watchlist.
submitted by WannabeStonks69 to wallstreetbets [link] [comments]

Elliott Waves Series Part 2 - The Broad Concept

Elliott Waves Series Part 2 - The Broad ConceptYou can find Part 1 here: https://www.reddit.com/Forex/comments/hieuyw/introduction_to_elliott_wave_theory_overview_of/
The primary value that the Wave Principle (from here on out, abbreviated to WP) confers on market analysts is the ability to provide context for market behaviour. Having context is incredibly important. To put it simply, the WP can be thought of as a compass. Whenever you feel lost looking at a chart (ANY chart, ANY market!), the WP will help get you back on track.
Clearing Up Some Misconceptions About Elliott Wave Theory:

  1. R.N. Elliott first discovered the WP in the 1930s using charts of the stock market. Many misinformed people believe that the WP works “best” on stocks and has been adapted for use in other markets. This is simply false. To be clear - Elliott discovered the WP. He did not invent the WP. The WP is based on human social nature and therefore it cannot be invented. It has always existed. What Elliott did was to start codifying rules and guidelines around how human social nature can be charted. Ultimately, Elliott’s objective was to be able to predict future human behaviour using the historical record. The expression of human social nature generates forms and patterns. As these forms and patterns repetitive, they have enormous predictive value.

  1. Another major misconception around the WP is that it requires a lot of discretionary analysis, and more often than not, analysts shoehorn price action to fit the Elliott Wave model. In fact, the WP has very clear rules (these rules are inviolate under any circumstance) and guidelines (these guidelines should be adhered to almost 100% of the time). While there is a discretionary element involved in counting waves, properly trained wave analysts will ultimately arrive at a consensus because following the rules and guidelines narrows the possible wave counts very quickly. Very often Wave analysts will have 2 counts at hand in terms of where they think the market is presently situated. These counts are known as the preferred count and the alternative count. These counts are validated and invalidated using price levels derived from Elliott’s rules and guidelines. The most dissent I expect from two educated Wave analysts is that one analyst’s preferred count could be the other’s alternative count. This dissent quickly resolves itself as the price action develops and validates or invalidates one count or the other. This dissent usually occurs based on wave patterns of one higher degree. It is very rare that I have seen dissent on immediate market movements.

  1. I didn’t know this was a major misconception, but someone brought this up in my first post, “I stated that Elliott Theory has better success when working in consolidations or extreme ranging markets.” This is completely false. The WP doesn’t work better or worse regardless of the market or the market conditions. That would be like saying that breathing air only works occasionally. The WP is NOT a strategy, it is the definitive model for charting human herding behaviour. Human behaviour does not show up only in periods of consolidation or range-bound markets. The markets are themselves driven by human behaviour, therefore the WP is always equally applicable. From a trading perspective, the WP is perfectly suited to capturing trends.

  1. Well, what about news events? What about supply and demand theory? What about fundamentals?! Doesn’t any of this stuff matter?? In short, the answer is no. I have previously stated that I am a macro-based investor. This is certainly true. Much of the research I consume has to do with market fundamentals and global-macro analysis. This research helps me form a view that I can overlay with the WP. From a trading perspective, when it comes to actually pulling triggers and taking positions, my decisions are always guided first and foremost by the WP. Here is a fantastic quotation from Bob Prechter on this topic, “Sometimes the market appears to reflect outside conditions and events, but at other times it is entirely detached from what most people assume are causal conditions. The reason is that the market has a law of its own. It is not propelled by the external causality to which one becomes accustomed in the everyday experiences of life. The path of prices is not a product of news. Nor is the market the cyclically rhythmic machine that some declare it to be. Its movement reflects a repetition of forms that is independent both of presumed causal events and of periodicity.”
The Bottom Line:
Elliott Wave Theory is the best forecasting tool in existence. It has determined that the market’s progression unfolds in waves. Waves can be thought of as patterns that carry the market in a direction. There are a fixed number of the different kinds of patterns these waves can take. If you really boil this down to its essence, successfully applying the WP is as simple as identifying what kind of wave the market is currently in.
I will end this now. The next part will deal with the overriding wave structure that the market is in, the different kinds of waves we will see, and why this wave structure exists in the first place.
submitted by ParallaxFX to Forex [link] [comments]

My Story

Hello everyone Im a longtime lurker and decide to post my story on my second account. Im 21 (m) and just like most of the people on this sub I’m a also virgin but I don’t see myself as a loser because of that. I have been offered by people to lose my card but I choose to reject their offer because of age or because I ain’t feeling it from the person offering it. Idk I’m the type of person that wants to have an emotional connection with someone rather than a sexual one.
Alright, So I come from an Hispanic Immigrant Family and I am part of the first generation to be born in the United States and first to go to college from my family (including cousins). And before I was born my destiny was set in stone as I would have the responsibility to carry my family out of poverty and into the lime light. With this my happiness was pushed aside and I was pushed to become a great student so our future would look bright but unfortunately along the way my knees buckled along the way as I was moving towards that goal.
So I guess I should explain my situation which all starts with my family situation. My parents are people who were too immature and not ready to have kids and unfortunately I was the first and that meant I was the test subject for them. Now I don’t hate myself or anything in general really but I hate my Dad in fact I hate my own name because it reminds me of him (I’m jr he’s sr) and I hate that because he was the cause for so much physical abuse and I’m not talking about the stereotypical sandal moment, I’m talking about getting a toy firetruck smashed on your head. Meanwhile on the other side I was subject to emotional abuse from my mom which was due to the shitty relationship they had and I was the stress outlet for both of them.
People do grow though and change along the way but I’m just too detached to them that I don’t want reconcile or continue to move forward with them. As said before I was the test subjest because by the second they improved and by the third they cracked the puzzle and finally succeeded at parenting. The thing is I am kinda jealous of my brother and sister on how they were treated and how they were able to relax and nothing was really expected of them. Which in turn has made detached from them because I have nothing in common with them but being born from the same person. Nor do I expected them to help with what was thrusted upon me one thinks shes hard and the other is lazy and cant read at all despite being in 8th grade. But besides that fact in all honesty I don’t see them as family but more as people I just live with. With my family situation in the gutter it basically set the foundation for the state of my mental health.
My mental health started becoming apparent in high school around sophomore year when I started to suffer from a lack of motivation when it came to moving forward with my life. It eventually escalated as time went on and it got was worse especially after high school. Because after high school I started getting some of my old memories pop up randomly and they were all about how I was treated as kid. None of them were pleasant memories such as the firetruck incident and all the physical and emotional abuse from my past. Which in turn brought me to an existential crisis as I questioned what I was working towards and this is where my knees started buckling and succumbed to the weight of the stress and responsibility thrusted upon me without my consent and I was left wondering why am I fighting for people I never really cared about or had my best interest. So while I was dealing with all this I was trying to deal with my depression which was by focusing on something no matter how small it was.
Which brings me to the light at the end of the tunnel which was Wrestling and I fell in love the moment I saw it for the first time because of the story telling aspect of it. I never understood someone’s passion for being an accountant, a manager or etc until I compared to my love for wrestling. Not only that but I don’t see it as just a sport but as a way out because it was the only thing that was able to keep me going. No matter how far I go back wrestling was always a part of my fun childhood moments unfortunately. Wether it be playing with my friends, or watching it on tv.
As time went on I even eventually got tired of watching it and wanted to be apart of it and wanted to make a career but their is no money to be made when starting out. So I gave up and decided to go to school and I am currently one year and a half from graduating but I just couldn’t take it anymore, because I wasn’t able to get internships and it wasn’t something I could see myself doing for the rest of my life. So on News Years some shit went down and I decided that 2020 would be the year that I would be happy by taking the steps necessary to focus on wrestling but unfortunately Covid hit so I couldn’t pursue that and eventually I stopped working out and just let everything go and pass me by as I shut myself in my room and only go out to work. Which leads to where I am now.
But before that I kept on mentioning an event that happened on News Years and that was where we went to visit my cousins in arizona and from their we went to Flagstaff where it snows and I was at awe because I just love the snow since I’m from California I don’t get too see much of it. Along the way back my mom was complaining the whole time as she wanted to go back home instead of Flagstaff and kept at it for the whole trip including insults and stuff about our cousins. It got bad to a point where I just wanted to jump out the car but since I was driving I didn’t want to take anyone’s else’s life with me nor did I want to cause a car crash as I was on the freeway. We went to eat later that day and she just kept at it and while I was their I went to the bathroom and broke down as I was praying for someone to save me and looking for a way to end my life. Instead of that I gave myself an ultimatum and that was if I don’t change my position in life by the end of 2020 I would unfortunately bite the bullet because I just need a Way Out of this place/situation I’m in.
I’m doing this ultimatum because I’m hoping it will motivate me to continue moving forward. Its currently august and I have payed of my debts, dropped out of school (hated my major), quit my job and got another one (thinking about quitting my new job), and I picked up forex in hopes of making money that way. With 4 months left on my ultimatum it seems like I haven’t done much but it’s whatever.
The thing is people have the impression that if you talk about your problems you will magically be saved but I could talk to someone about my problems for days but the thing is I don’t need to talk about my problems what I need is a way out of my current position in life and I have thought about spending a month in Japan just exploring and spending my last month alive their but Covid unfortunately came along and ruined what hope I did have if I were able to describe my situation in a song it would be the song Maze by Juice WRLD and the song Come back to Earth by Mac Miller.
The things is if I die I’m gonna miss trivial things like not being able to see the ending of Attack on Titan, Solo Leveling, My Hero Academia, Wings, McDonalds, In-n-out, Pizza, Food/Anime/Wrestling in general, the new music I’m gonna miss or even seeing what path my little cousin is going to take as he grows up. And Depending on what I choose to do moving forward I will try to update you guys with my progress and if I don’t then I guess I bite the bullet. Anyways thanks for reading my story feels more like a Memoir but I just wanted to get this of my chest.
SideNote: Also sorry for it being so long but this is just the surface theirs actually a lot more I could go into detail but I went on long on enough.
submitted by PT_K to depression [link] [comments]

7 Steps For A Healthy Trading Experience

7 Steps For A Healthy Trading Experience
https://eu.excentral.com/blog-article/?articleId=33121
There are many ways to trade, but there are just a few ways to open a transaction correctly. And this is one way you wouldn’t want to miss. Buckle up for a blog full of trading insight and eye-opening tips, straight from the trading world. All traders, from the less all the way to the highly experienced ones should read this blog to advance their game.
Needless to say, if you’re relatively new to the world of trading, this is a blog post you should definitely read. It includes the steps you need to take to open a transaction, weighing in the facts and data you gather from trustworthy sources.
However, if you’re trading like most people are breathing, then this is a blog post you might also benefit from reading, from the fact that it will give you a chance to reassess the most basic steps of trading, from a knowledgeable point of view.
Read this if you want to upgrade your strategies, checking the news and what are some verified news-sources, following the economic releases calendars, all the way to ‘reading’ the charts.

Here’s what you’ll better do

  1. Make sure you find a piece of news on an asset you understand – you can choose pretty much everything, from your country’s currency, main commodities products, indices, famous shares or even cryptocurrencies – we've got over 120 such assets. Just make sure you understand its current trend and what might impact it in the coming future. Make sure you find verified news outlets like: Reuters, Bloomberg, Investing, Business Insider, Financial Times, Market Watch, Forex Factory etc.
  2. Check the chart (try adding some indicators) – the chart will tell you more about the trend of the asset up to the moment you’re checking it. If you’re a more analytical trader, you might get the whole picture and base your trades on the chart solely. If you’re good with indicators, try combining several, to double-check your assets.
  3. Check the Economic Calendar for any upcoming events that impact the asset’s trend – If the chart doesn’t quite paint the picture, try combining it with the economic calendar. As an exercise, try to see which events trigger what kind of movement. Although past events can’t be an indication of future trends, they help you practice and better understand an asset’s movements.
Keep in mind that these first three steps are interchangeable. You can even start backwards, or first from the Chart, as they serve as verification methods of one another. Experienced traders can even make sense of asset’s trends using just one of these steps. But you know what they say: practice makes perfect.

A simple analysis might not be enough

  1. Make sure you have enough margin to pursue the trades you’re planning – based on the leverage you’re using, you might hear that a handful of investors recommend using 20% of your available margin, leaving the rest as a safety net in case your scenario goes haywire. However, the truth is somewhere in the middle. You need to consider the volatility of the assets you’re trading with, the total margin available in your account as well as all the events taking place in the markets at that specific time when you’ll open the transaction.
  2. Prepare a solid Risk Management Technique – there’s no one-size-fits all strategy we can use when trading, and actively following our transactions seems to be the best solution we have. Probably only a good Risk Handling Technique can prevail, so make sure to research yours in depth.
  3. Analyse the right entry and exit strategies for a variety of scenarios. It’s not all about setting up stop loss and take profit. Consider the period you’re willing to hold the transaction open for, the events that might start influencing the trend, or whether you’re planning on changing the stop limits at all. For more information make sure to check out Michalis Webinars.

Don’t forget to invest in your knowledge and…

  1. Trade – based on what you expect to happen next in the markets, buy – if you anticipate the asset’s value to rise, or sell – if you think the asset’s value will drop.
If any of the above points give you a headache, make sure you follow our webinars, held by eXcentral’s Market Analyst, Michalis Efthymiou. And for more information make sure to ask your Account Manager to arrange a 1-on-1 with Michalis, it might surprise you how much he knows about investing.
submitted by eXcentralEU to u/eXcentralEU [link] [comments]

Important World Events To Consider When Trading

One of the most important things to be cognizant of is a major change in country leaders. This is especially true if a government is violently overthrown or if the selection process has otherwise been atypical. Volatile and unstable governments are commonly associated with economic instability.
It is additionally vital to pay attention to what major world corporations are doing. When a business moves the majority of its operations to another country or continent, monetary values will invariably travel with it. Outsourcing jobs to another location brings money into that location while taking it out of the other. The best currency pairs in these instances are the country to which the work is being outsourced to and the country that is losing the related employment opportunities.
When nations experience extreme weather conditions or national disasters, these events will have both immediate and extended effects on local economies. Events like these can damage crops and overthrow export industries. Thus, before you start planning and implementing new trades on the Forex, it is vital to consider the range of recent national disasters that have occurred and to read up on any major changes in government.
If you have a trading theory that is based upon national disasters or political upheavals, it is a good idea to test your theory in a simulated environment before leveraging actual cash. This is especially true if you are brand new to this market and have little trading experience. Although you might have a keen understanding of how certain changes will impact local currencies values, it will take both time and experience to understand the magnitude of their effects.
Traders should become adept in researching and discerning the meaning of different forms of world change on their own. While a lot of successful traders rely on their own sources to conduct this research for them, it is much safer and infinitely more effective to become informed on your ow. This is because many reputable sources in this sector are often guilty of doing what is known as going along with the herd.
When information sources go along with the herd, they are basically seconding the opinions of every other news source out there, even if they have information that conflicts with the common sentiment. It can be devastating for an analyst or a reporter to branch out on his or her own only to be proven wrong by future market actions and conditions. It is a far safer career choice to simply agree with the majority even if this means being wrong and potentially leading investors astray.
Before you can devise or implement any successful Forex trading strategy, you have to learn how to use charts, indicators and other technical tools to better understand the most likely direction of currency values. Much like foreign markets, however, the foreign exchange market requires you to additionally be informed of current world events. Becoming a regular reader of reputable newspapers and other forms of print journalism will help you make highly informed and highly profitable trading decisions.
submitted by jeffout to ForexBrokersRated [link] [comments]

Factset DD

Factset: How You can Invest in Hedge Funds’ Biggest Investment
Tl;dr FactSet is the most undervalued widespread SaaS/IT solution stock that exists
If any of you have relevant experience or are friends with people in Investment Banking/other high finance, you know that Factset is the lifeblood of their financial analysis toolkit if and when it’s not Bloomberg, which isn’t even publicly traded. Factset has been around since 1978 and it’s considered a staple like Bloomberg in many wealth management firms, and it offers some of the easiest to access and understandable financial data so many newer firms focused less on trading are switching to Factset because it has a lot of the same data Bloomberg offers for half the cost. When it comes to modern financial data, Factset outcompetes Reuters and arguably Bloomberg as well due to their API services which makes Factset much more preferable for quantitative divisions of banks/hedge funds as API integration with Python/R is the most important factor for vast data lakes of financial data, this suggests Factset will be much more prepared for programming making its way into traditional finance fields. According to Factset, their mission for data delivery is to: “Integrate the data you need with your applications, web portals, and statistical packages. Whether you need market, company, or alternative data, FactSet flexible data delivery services give you normalized data through APIs and a direct delivery of local copies of standard data feeds. Our unique symbology links and aggregates a variety of content sources to ensure consistency, transparency, and data integrity across your business. Build financial models and power customized applications with FactSet APIs in our developer portal”. Their technical focus for their data delivery system alone should make it stand out compared to Bloomberg, whose UI is far more outdated and complex on top of not being as technically developed as Factset’s. Factset is the key provider of buy-side portfolio analysis for IBs, Hedge funds, and Private Equity firms, and it’s making its way into non-quantitative hedge funds as well because quantitative portfolio management makes automation of risk management and the application of portfolio theory so much easier, and to top it off, Factset’s scenario analysis and simulation is unique in its class. Factset also is able to automate trades based on individual manager risk tolerance and ML optimization for Forex trading as well. Not only does Factset provide solutions for financial companies, they are branching out to all corporations now and providing quantitative analytics for them in the areas of “corporate development, M&A, strategy, treasury, financial planning and analysis, and investor relations workflows”. Factset will eventually in my opinion reach out to Insurance Risk Management a lot more in the future as that’s a huge industry which has yet to see much automation of risk management yet, and with the field wide open, Factset will be the first to take advantage without a shadow of a doubt. So let’s dig into the company’s financials now:
Their latest 8k filing reported the following:
Revenue increased 2.6%, or $9.6 million, to $374.1 million compared with $364.5 million for the same period in fiscal 2019. The increase is primarily due to higher sales of analytics, content and technology solutions (CTS) and wealth management solutions.
Annual Subscription Value (ASV) plus professional services was $1.52 billion at May 31, 2020, compared with $1.45 billion at May 31, 2019. The organic growth rate, which excludes the effects of acquisitions, dispositions, and foreign currency movements, was 5.0%. The primary contributors to this growth rate were higher sales in FactSet's wealth and research workflow solutions and a price increase in the Company's international region
Adjusted operating margin improved to 35.5% compared with 34.0% in the prior year period primarily as a result of reduced employee-related operating expenses due to the coronavirus pandemic.
Diluted earnings per share (EPS) increased 11.0% to $2.63 compared with $2.37 for the same period in fiscal 2019.
Adjusted diluted EPS rose 9.2% to $2.86 compared with $2.62 in the prior year period primarily driven by an improvement in operating results.
The Company’s effective tax rate for the third quarter decreased to 15.0% compared with 18.6% a year ago, primarily due to an income tax expense in the prior year related to finalizing the Company's tax returns with no similar event for the three months ended May 31, 2020.
FactSet increased its quarterly dividend by $0.05 per share or 7% to $0.77 marking the fifteenth consecutive year the Company has increased dividends, highlighting its continued commitment to returning value to shareholders.
As you can see, there’s not much of a negative sign in sight here.
It makes sense considering how FactSet’s FCF has never slowed down
FactSet’s annual subscriptions and professional services have made its way to foreign and developing markets, and many of them are opting for FactSet’s cheaper services to reduce costs and still get copious amounts of data and models to work with.
Here’s what FactSet had to say regarding its competitive position within the market of providing financial data in its last 10k: “Despite competing products and services, we enjoy high barriers to entry and believe it would be difficult for another vendor to quickly replicate the extensive databases we currently offer. Through our in-depth analytics and client service, we believe we can offer clients a more comprehensive solution with one of the broadest sets of functionalities, through a desktop or mobile user interface or through a standardized or bespoke data feed.” And FactSet is confident that their ML services cannot be replaced by anybody else in the industry either: “In addition, our applications, including our client support and service offerings, are entrenched in the workflow of many financial professionals given the downloading functions and portfolio analysis/screening capabilities offered. We are entrusted with significant amounts of our clients' own proprietary data, including portfolio holdings. As a result, our products have become central to our clients’ investment analysis and decision-making.” (https://last10k.com/sec-filings/fds#link_fullReport), if you read the full report and compare it to the most recent 8K, you’ll find that the real expenses this quarter were far lower than expected by the last 10k as there was a lower than expected tax rate and a 3% increase in expected operating margin from the expected figure as well. The company also reports a 90% customer retention rate over 15 years, so you know that they’re not lying when they say the clients need them for all sorts of financial data whether it’s for M&A or wealth management and Equity analysis:
https://www.investopedia.com/terms/f/factset.asp

FactSet also has remarkably good cash conversion considering it’s a subscription based company, a company structure which usually takes on too much leverage. Speaking of leverage, FDS had taken on a lot of leverage in 2015:

So what’s that about? Why were FactSet’s long term debts at 0 and all of a sudden why’d the spike up? Well usually for a company that’s non-cyclical and has a well-established product (like FactSet) leverage can actually be good at amplifying returns, so FDS used this to their advantage and this was able to help the share’s price during 2015. Also, as you can see debt/ebitda is beginning a rapid decline anyway. This only adds to my theory that FactSet is trying to expand into new playing fields. FactSet obviously didn’t need the leverage to cover their normal costs, because they have always had consistently growing margins and revenue so the debt financing was only for the sake of financing growth. And this debt can be considered covered and paid off, considering the net income growth of 32% between 2018 and 2019 alone and the EPS growth of 33%

EBITDA has virtually been exponential for FactSet for a while because of the bang-for-buck for their well-known product, but now as FactSet ventures into algorithmic trading and corporate development the scope for growth is broadly expanded.

P/E has declined in the past 2 years, making it a great time to buy.

Increasing ROE despite lowering of leverage post 2016

Mountains of cash have been piling up in the coffers increasing chances of increased dividends for shareholders (imo dividend is too low right now, but increasing it will tempt more investors into it), and on top of that in the last 10k a large buyback expansion program was implemented for $210m worth of shares, which shows how confident they are in the company itself.

SGA expense/Gross profit has been declining despite expansion of offices
I’m a bit concerned about the skin in the game leadership has in this company, since very few executives/board members have significant holdings in the company, but the CEO himself is a FactSet veteran, and knows his way around the company. On top of that, Bloomberg remains king for trading and the fixed income security market, and Reuters beats out FactSet here as well. If FactSet really wants to increase cash flow sources, the expansion into insurance and corp dev has to be successful.
Summary: FactSet has a lot of growth still left in its industry which is already fast-growing in and of itself, and it only has more potential at its current valuation. Earnings September 24th should be a massive beat due to investment banking demand and growth plus Hedge fund requirements for data and portfolio management hasn’t gone anywhere and has likely increased due to more market opportunities to buy-in.
submitted by WannabeStonks69 to investing [link] [comments]

How To Trade Forex On News Releases: Impact of News Events ... Scalping The News with Forex Trading Part 2 (7% ROI in 2 ... WHEN YOU KNOW FOREX NEWS DIRECTION BEFOREHAND - YouTube Top 5 Economic News Events for FOREX Trading - YouTube How To Trade Forex With An Economic News Event [FOREX NEWS EVENTS] news events that create a high ... Predicting & Winning News Events in Best Forex Currency Meter CASE STUDY CAD Employment

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day.Reuters provides trusted ... Real-time forex news and the latest trading updates. What you need to know now about the GBP, Dollar, Yen, Euro and minors. The ForexLive economic calendar can help you get a better perspective on forex news events that could impact your trading. Economic data indicators and mood sentiment change often so stay informed ... Forex news is an integral part of the trading process, and our goal is to provide you with the Forex trading news you need to be successful. Our daily Forex news is written by industry veterans with years of trading and reporting experience, so that you can get the information you need without the fluff. Daily Forex news blogs section, talks about insights on currency pair trends and analysis, business analysis, world currency & current events. (+60)1-800-81-7242 [email protected] Facebook Forex News - the fastest breaking news, useful Forex analysis, and Forex industry news, submitted from quality Forex news sources around the world. View our fast-updating and interactive economic calendar for important events and releases that affect the forex, stocks and commodities markets. News & Analysis at your fingertips. Install . We ... Top 5 Market News Events 1.Central Bank Rate Decision Each month the various Central Banks of the world’s economies meet to decide over the interest rates they are responsible for. Advanced forex news calendar automatically updated in real-time as soon as current economic events get released. Customize it by selecting the time zone and filtering economic events by market impact, currencies, and their type. See economic news sources, descriptions, frequency, and historical list of events with the data. Follow all the latest forex news, trading strategies, commodities reports & events at DailyFX

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How To Trade Forex On News Releases: Impact of News Events ...

Using very advanced realtime Currency Analytics to predict a News Event outcome. Want to trade like the professionals? Join our Free webinar to get our FREE Order Flow trading strategy. See within the candles as institutional traders do! ... Learn how to turn news into profits with our market commentary - learn more here - https://bit.ly/2lzfvDU In this video you'll learn the top two ways for making money from economic news events. One of the best ways to profit from Forex Trading is to trade on market moving news. When major news is released, forex prices tend to move rapidly and knowi... How to trade forex (or any market) on news releases? http://www.financial-spread-betting.com/strategies/trading-the-news.html PLEASE LIKE AND SHARE THIS VIDE... 💰😂WHEN YOU KNOW FOREX NEWS DIRECTION BEFOREHAND. WATCH How to predict forex news direction beforehand using Investing.com. Here is one way of predicting fore... This video was created for people who do not know what kind of news events they should trade. I provide the news events that i found more volatile while i wa...

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