Despite the near 40% drop in the value of Bitcoin this year and the growing spectre of regulations, arbitrage hedge funds are announcing relatively strong performance numbers compared to the wider market. One such hedge fund is the Nickel Digital Asset Management arbitrage fund which is only down 0.6% this year. This compares to the considerable drop in the value of Bitcoin and a 24% fall in the NASDAQ index. So does arbitrage work?
There is no doubt that Financial Technology (FinTech) will play a more prominent role in financial markets in the future. Investment in this area has reached record levels, and many believe this is only the start of the revolution.
Many people new to the short-term/day-trading arena assume that technical analysis is a relatively recent phenomenon. However, you would be surprised when it comes to systems such as the candlestick charting analysis method!
In relation to investment, technical analysis has been in use for well over a hundred years in various forms. While today there are many different variations of historical technical analysis strategies, one question is still prevalent. Is technical analysis a self-fulfilling prophecy?
Many people believe that short-term trading is a more risky strategy than long-term investing. As a result, short-term traders are often portrayed as individuals who would bet on the throw a dice. In reality, there are many misconceptions about execution-only short-term traders.
To some people, perceived risk and actual risk may seem like two sides of the same coin. However, in reality, they are very different, and they can significantly impact share prices. Day traders can use perceived risk in both bull markets and bear markets. An activity which you could describe as trading on sentiment?
As many day traders are attracted to relatively volatile stocks, their beta value can often provide a fascinating insight into the future. A stock’s beta measures the share price volatility/market risk compared to other indexes or even stocks. While many traders look towards more “modern” complicated technical trading strategies, a simple measure of historical volatility can be very useful.
For the vast majority of investments, the days of holding certificates and filling out stock transfers have long gone. Instead, shares are now acquired through an electronic trading system and registered electronically to assist clearing services in speedy settlement. However, this prompts the question, how secure are your safe custody assets?
Over the last month, the value of a Bitcoin has fallen from £31,364 ($41,149) to £24,267 ($29,748), a fall in excess of 20%. Looking further back, in November 2021, Bitcoin hit just over £48,000 ($64,000) and has since fallen by nearly 50% in sterling terms. So is this the beginning of the end or the start of a new chapter for cryptocurrencies?
The official name is the Cboe Volatility Index, although it is affectionately known as the VIX Index. Used by professional traders as a means of monitoring short-term volatility expectations on the S&P 500 index, it has proven very useful. Over the last 12 months, the VIX Index has been as low as 15, as high as 36.45 and currently stands at 32.56. So how is this useful to global traders?