Risk premium just went up

K

kxvid

Who wants to own stocks when on what looks to be a OK day they sell of like that in the last 10 minutes? Risk premium just went up: by a alot.
 
Tell us with all honesty: when and where did you go long the market? If you went long and can explain it, I think I can help you to sold any eventual trading problems.

It is related to the question I posed in post below.

Quote from riskfreetrading:

another great day at RFT's blog. We nailed the bottom of NDX in the 1180 area. The rest are just details!

Here is a more difficult question now: what will happen on Monday? Will they gap it up and then let it fall, or gap it down, close to the low of today and see whether there are still some trapped bears in the whole of 1177 and down.

Notice that there are also some trapped bulls who bought the top of yesterday and the top of today in area of 1240!

Who are these dumb folks who buy at the top and sell at the bottom? I just do not understand why in the world a sane person would buy at top of range and sell at bottom of range.

Could anyone help me understand this please?

:p
More...
 
Quote from kxvid:

Who wants to own stocks when on what looks to be a OK day they sell of like that in the last 10 minutes? Risk premium just went up: by a alot.
More...

Correct, although it happened not today, but at the start of September. As measured by VIX, stocks have suddenly became 3 times riskier than what they have been historically. The implication is quite dramatic: stocks have to become 3 times less expensive to justify the tripled risk. We are already at the point where prices are close to half of what they were only a short time ago, so it's not that far from the full adjustment.
 
RFT,

I like to subscribe to any and all trading related blogs via my google reader. Would you be able to post here or PM me your blog?

Thanks,

John
 
Quote from johnpinochet:

RFT,

I like to subscribe to any and all trading related blogs via my google reader. Would you be able to post here or PM me your blog?

Thanks,

John
More...

John,

Link is below. I did not include it as I did not want to take the risk to be accused of "spam".

Please PM me your list of blogs, so I can follow what I like-- I love to read about trading and investing.

http://financialtraders.blogspot.com/
 
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