Highlights books related to the week's top financial news stories, by Karris Golden, president & COO of Wasendorf & Associates (Traders Press Inc., W&A Publishing and SFO Magazine)
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According to Reuters, the SEC and CFTC are moving toward finalization of a definition for “swap dealer.”
In a swap trade, Party A exchanges the cash flows of its financial instrument for that of Party B. According to the Financial Regulatory Reform Center, a “swap dealer” is any person that:
·Holds itself out as a dealer in swaps
·Makes a market in swaps
·Regularly enters into swaps with counterparties in the ordinary course of business for its own account
·Engages in any activity causing the person to be commonly known as a dealer or market maker in swaps in connection with the CFTC-regulated swaps
The SEC/CFTC “swap dealer” tag is expected to come with more oversight and increase the cost of such trades. The designation also will give firms latitude to exempt swaps for hedging.
Reuters notes that the Dodd-Frank financial oversight law, which was first proposed in December 2010 in reaction to the financial crisis, has changed dramatically. While it originally allowed firms to be designated swap dealers if they traded more than $100 million in swaps over a 12-month period. As Reuters reports, energy companies and commodity traders lobbied to alter the provision to bump the threshold to $8 billion for most asset classes as an initial phase-in. In time, the threshold could drop to $3 billion.
Both regulatory agencies face legal challenges over the rules. There also are concerns that the SEC and CFTC have not fully analyzed the economic impact and rule formulation processes.
To learn more about swaps, futures, options and other financial instruments affected by Dodd-Frank, go to TradersPress.com. There, you’ll find everything priced to meet or beat those you’d find on Amazon and you’ll receive free S&H when you spend $25 or more.
THIS WEEK’S PENNY SALE is for Ticker Technique and Roadmap to the Markets. Between now and April 29, you can pick up either—-or both—-of these titles for only 1 cent* each!
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Some girls dream of being ballerinas or princesses.
Not me. As I sat at my grandpa’s knee and learned about baseball, I nurtured dreams of being a Major League Baseball umpire.
I’m not kidding —- not even a little. I love almost everything about the game. I’d tell you about the “almost,” but it’s such a minor, nit-picky thing that would make me sound nutty.
So will this: I’m a long-suffering Chicago Cubs fans. Today marks the opening of the 2012 Cubs season and puts me in mind of a unique book filled with useful trading insights.
Like baseball, trading requires sound coaching, honest self-knowledge and shrewd understanding of “the game.”
“They both started as relatively informal endeavors in New York and grew into massive institutions,” he writes. “Organized trading started under a tree along a wall that protected a city. The wall gave name to a street, and the street later became home to one of the most venerable institutions on earth. Organized baseball started in fields around the same city. Its popularity grew, and it spread to fields around the country.”
Shop Traders Press® for the lowest prices on this and other titles. We’ve done all the leg work; if you find it Amazon has it priced lower, send us a link, and we’ll beat it! In addition, all orders of $25 or more delivered to addresses within the continental United States will ship for free!*
March is Women’s History Month, a worldwide observance of the contributions we’ve made in the past and present.
More women than ever trading and taking control of their investments. And philanthropy expert Margaret May notes that women spend $5 trillion per year and control more than 75% of the total wealth in the United States. We also influence and/or make 84% of household financial decisions.
So while I’m all for celebrating our history and remembering where we came from, my priority is to ensure we all have access to information to grow personal wealth.
·SFO magazine—a digital publication for stocks, futures, foreign currency and option traders that’s always free. It’s a great way learn and start building confidence, plus it’s edited by women!
OrderOptions Trading in Your Spare Time and the other titles mentioned in today’s blog. No need to use a promo code; just take advantage of the better-than-Amazon pricing at TradersPress.com and enjoy free S&H* when you spend $25 or more.
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Technology in ePublishing has improved reading devices, making the experience more like reading printed books. But “cuddle with my Kindle” doesn’t quite roll off the tongue—yet.
I was definitely a hold out on eBooks, largely because I’ve been wrestling with the darn things since their infancy. Early on, they weren’t great.
Then I held a Kindle a few years ago. I was nothing short of covetous.
Ultimately, I got an iPad. My reaction? Pure joy. I have actually hugged the thing—more than once.
My iPad hasn’t changed the way I read. I still bookmark, highlight, make notes and look up words. I also can continue reading several books at a time, but without lugging them all around.
What did I give up for the iPad? Well, paper, and I’m better off. And until the voluminous, complete set of the human experience finally makes it to iBooks, I’ll keep hoofing it to the library. I also purged thousands of books from my home—another thing for the win column.
The white paper was commissioned by PFGBEST at the request of Russell R. Wasendorf Jr., president for the Commodity Customer Coalition. It offers solutions to be considered by the Commodity Customer Coalition, which strives to ensure that any government policy responses are appropriate and cost effective to protect customers and maintain the integrity of futures markets.
I believe the white paper speaks for itself and encourage you study it closely.
The S&P 500 has experienced 16 violent declines in the past 18 years. Ouch.
Professional and institutional investors weather those upsets by using hedging techniques, according to authors Jay Pesterichelli and Wayne Ferbert. In Buy and Hold Hedge: The 5 Iron Rules for Investing over the Long Term, the investment experts outline ways to use hedging as part of a long-term plan for growing and preserving portfolio assets.
“The (2008) market crash was precipitous and calamitous,” they write. “Think about the investment decisions you faced with your portfolio.”
Did you “curl into the fetal position and hope it would all go away”? Blame your investment adviser and demand results? Sell everything? Look for tax advantages among your investing losses?
“(O)f these four actions, the only one that was even modestly productive was the last one,” Pestrichelli and Ferbert explain. “At least the investor who looked for tax efficiency from the losses might have saved himself a bit of money. But it’s hard to save on taxes when you don’t have any gains to offset the losses. You can at least admire the person who tried to find tax efficiency for his ’glass half-full’ attitude.
Pestrichelli and Ferbert co-founded ZEGA Financial LLC, where they are the principals. Pestrichelli has 20 years of experience in business management, with 12 years in the online brokerage field. Ferbert has been in financial services for 18 years and 10 years in the online brokerage field.
The book begins by introducing the concept of hedging as it relates to financial markets, explaining risk-and-return decisions, psychology and other considerations. It goes on to cover investing laws, the rules of buy and hedge, the basics of hedging and advanced tactics.
In all, the book is a good, basic primer for anyone who wants to understand how buy and hedge works, simply ways investors can hedge their portfolios and common mistakes individual investors make.
“Maintaining a long-term outlook for your investments is a key success factor in a Buy and Hedge portfolio,” Pesterichelli and Ferbert write. “However, we could easily rewrite this rule as ‘Avoid having a short-term outlook.’ The reality is that the benefits of a long-term outlook are as powerful as the problems resulting from a short-term outlook. Let’s start by examining the destructive powers of a short-term outlook and then return to the advantages of a long-term outlook.”
Buy and Hold Hedgeisn’t strictly for full-time money managers—or those who want to become one. Instead, the bookcan be useful to anyone willing to educate him or herself using its straightforward easy to understand distilling of sophisticated investing techniques.
Purchase Buy and Hold Hedgetoday and use my blog code, KGBLOG0112 to receive 20% off the cover price, plus free U.S. S&H.*
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When I hear this, I smile politely. I just don’t get it.
This isn’t a case of a writer railing against the imprecise use of language. I profess to “love” many things you might consider implausible. Can I really love bad pop songs from the 1980s and 1990s? Insensible shoes? Peanut butter?!
Doubt all you want. My love is true—especially where peanut butter is concerned. So I respect another’s right to love Cramer. Free country and all that. Plus, he offers some great information. His books, like Getting Back to Even and Mad Money, are good.
And now the “but” you’re waiting for: Cramer’s flaws are glaring and often insurmountable. When someone with a public, worldwide forum regularly flaunts his inconsistencies, irresponsibility and hypocrisy, that’s a fairly big deal.
For example, Cramer’s latest crusade is against crude oil speculators. He wants them indicted for driving up the price of gas. He wants more and better regulation. He made his outraged case on his TV show, Mad Money.
He’s clearly angry. But it doesn’t ring true, because a month ago he advocated the same trading practices that he now derides when advising viewers on how to trade gold.
Sometimes, Cramer just can’t help but rat himself out; he seems to be one of those guys who needs you to know he got away with something naughty. Cramer was at the center of a 2007 controversy because he explained how, as a hedge fund manager, he used admittedly illegal practices to manipulate stock prices. He bragged about it—to USA Today.
Influential financial TV personalities will probably always make wildly irresponsible statements, and some individuals will suffer. Your best, safest bet is to develop a solid understanding and learn how you can best to interpret all the available information.
Save on the titles mentioned in today’s blog and more by using promo code KGBLOG911 to receive 20% off sitewide and free U.S. S&H* at TradersPress.com.
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From time to time, I participate in some harmless joking around on Twitter.
Playing Twitter hashtag games probably marks me as a big nerd, but it’s a nice break from gazing at my Star Trek: Deep Space Ninememorabilia. (Just kidding; I’d never be so careless as to expo my collectables to direct light.)
The idea is to take the well-known title of a beloved book and make it “less interesting.” A few of my gems:
·The Chronicles of Narnia = The Chronicles of Norman
·Lord of the Flies = Lord of the Fries
I’m not particularly great at it, largely because my mind usually strays to the double entendre. Those are hardly less interesting. For example, I became stuck on this, which isn’t dull:
The Lion, The Witch, and The Wardrobe = The Lampost, The Whip, and The Bathrobe
Of course, a book’s title is serious business. It must be so many things—intriguing, meaningful, interesting, memorable and more.
Tongue-in-cheek titles certainly do that. Several grace the Traders Press® catalog. My quick list:
Then there are those that require a ton of explanation, which really flies in the face of Book-Naming 101. As far as I’m concerned, Where are the Customers’ Yachts? tops this list.
If you’re disappointed to learn I waste brain cells conjuring silly book titles, consider there are others far worse than I. When I polled staffers on the topic, I discovered a few people who can make anything sound “questionable” just by stressing the right words.
What titles have I overlooked? Which are your favorites? Send me yours at karris@traderspress.com.
Save on the titles mentioned in today’s blog and more by using promo code KGBLOG911 to receive 20% off sitewide and free U.S. S&H* at TradersPress.com.
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Volatility isn’t as scary as some would have us believe.
For the long-term investor, time and diversification dampen market volatility, notes U.S. News & World Report. For the individual trader, volatility can be an important tool, when used carefully.
Consider this: According to Financial Times, volatility will shake up the currency market more than price declines. For gold, historical volatility and implied volatility are the highest they’ve been since 2009, reports Financial Times. Silver volatility has jumped, too.
How can you use this volatility to your advantage? A simple search of articles from SFO (Stocks, Futures, Options) Magazine offers a wealth of information on the topic. This month’s issue includes “Learn to Use” StockTwits by Paul, which offers insights on how to get real-time information.
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According to the Associated Press, Forbes, and Bloomberg Businessweek, G.E., Bank of America Corp., Citigroup Inc., Caterpillar Inc. and Alcoa Inc. were among those that increased 1% or more on Wednesday, following a rally in European lenders.
Greek, German and French leaders will meet today to discuss ways to contain Greece’s debt crisis. Speculators believe China may be willing to buy the bonds of nations hit by the debt crises, as reported by Businessweek.
Not everyone supports such a plan, according to the English-language Caijing magazine. Some advisers to China’s central bank believe the nation’s willingness to purchase euro bonds is little more than an ill-advised “bleeding heart” response to the global debt crisis.
“What today’s world needs is not a ‘bleeding heart’; instead, it needs investors with a senseo fo reform and cooperation,” Li Daokuu, academic adviser to the central bank, told Caijing. “I believe (China) will perform a role of a real good guy rather than a ‘bleeding heart.’”
In the article, he advises diversification of China’s foreign exchange reserves with solid investments.
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