Instructions to an agent or broker to buy or sell a security at the price obtainable at the time the trading opens, otherwise to cancel the order.It is an at the opening order is a way for an investor to secure a position at the opening of a trading session.A trader can place a market at the opening order or a limit at the opening order. A market at the opening order is an … [Read more...]
What is Backtesting?
Backtesting The process of testing a trading strategy on prior time periods. Backtesting (or back-testing) is the process of evaluating a strategy, theory, or model by applying it to historical data. It can be used in situations like studying how a trading method would have performed in past stock markets, or how a model of climate and weather patterns would have matched … [Read more...]
Stock-Picking Strategies
Stock-Picking Strategies: Dogs of the Dow The investing strategy which focuses on Dogs of the Dow was popularized by Michael Higgins in his book, "Beating the Dow". The strategy's simplicity is one of its most attractive attributes. The Dogs of the Dow are the 10 of the 30 companies in the Dow Jones Industrial Average (DJIA) with the highest dividend yield. In the Dogs of … [Read more...]
How does Backtesting works ?
Backtesting: Interpreting the Past Backtesting is a key component of effective trading-system development. It is accomplished by reconstructing, with historical data, trades that would have occurred in the past using rules defined by a given strategy. The result offers statistics that can be used to gauge the effectiveness of the strategy. Using this data, traders can … [Read more...]
What is a Mini-Sized Dow Options?
Mini-Sized Dow Options is a highly leveraged index option on a futures contract in which the underlying index is the Dow Jones Industrial Average. The option has a multiplier of five, meaning that the option allows one to buy (for a call) or sell (for a put) up to five times the value of the DJIA. This allows one to profit from the option for a lower price than one would … [Read more...]