Notice that while retail was arguing with Buffett and buying every airline stock and their ETF, the best program trading firms were selling them all they wanted and driving the markets lower. And then setting up for Expiration Week, that is also Post Unemployment Week. Program Trading was over 93% of the volume last week and normal after a crash. http://www.programtradingresearch.com/subscribers/dailyoex.htm
I have a few questions for you: 1. Everyone of your posted links showed this one image. Why posted so many times? 2. If my time horizon is not a day or a couple of weeks but rather a couple of months or longer, shouldn't these dumping be a good time to buy when they are dumping stocks in a growth industry with good fundamentals? e.g., FB on March 23rd (@$140 and @211 on Friday, MRK on May 8th in the above page (@$76 and @ $79.8 on Friday with aftermarket @$81.76 today)? I understand not all the stocks they dumped are good bets for retails and prudent analysis is necessary. I am wondering if Program trading is just herd trading? 3. Elsewhere in the website (FAQ page), it says TOS, NT and IB are not good trading platforms? Do you understand why it says that? Thank you for the thread. Very enlightening for this retail.
1) that's an error on my part, thanks for bringing it to my attention. 2) A) In a news driven market fundamentals does not matter unless you're willing to hold long term. B) there is some truth to herd trading. 3) I do not know
We now know who was taking the other side of the Program Traders: https://www.elitetrader.com/et/thre...has-bought-a-big-stake-in-boeing-714m.344892/ I think as of today both sides made money, one short term one longer term. So, who lost?
There are losers from every spectrum of the trading/ investing community eg I think you remember this one: Norwegian wealth Norway's sovereign wealth fund—at $1 trillion, the world's largest—is going to have to make the unprecedented move of liquidating some of its assets in order to cover withdrawals by the country's government. Such are the demand of the current crisis. Norges Bank Governor Oystein Olsen, who oversees the fund: "It obviously is a positive feature of our society that we have this room to maneuver, unlike a number of other countries." No kidding.
Notice that while retail was bottom fishing and buying stocks for a bounce, the best program trading firms were selling to them and were net short to net neutral for the week. And setting up for May Post Expiration Week. Program Trading was over 95% of the volume last week and normal during May Expiration Week. http://www.programtradingresearch.com/subscribers/dailyoex.htm