Australian (ASX) Stock Market Forum

US Markets - Question for WayneL

Jump to new
ctp6360

ctp6360

Joined
22 June 2005
Posts
277
Reactions
2
Hi WayneL,

I noticed in another thread you said that trading the ASX was garbage and that you thought trading in the US market was a lot better. If you don't mind I had 2 questions for you:

1) What are the top 3 advantages to trading the US market over the Australian market, other than the fact you can short?

2) Do you use an online broker to trade in the US markets, and if so, which one would you recommend based on your personal experience?

Please don't answer these questions if you don't want to, I am just curious, and I'm also aware that you are not formally qualified to give advice :)
 
Hi,

Did I say the ASX was crap? :eek: Well, it's clearly not crap, simply not suitable for how I like to trade.

1/

1.Greater choice of stocks to trade
2.Greater liquidity, even in smaller cap stocks
3.Greater volatility
4.WAY greater number of stocks with liquid, tradable options
5.Can construct ANY options strategy AND trade it online
6.Access to futures markets
7.Much cheaper commisions
8.Much cheaper data

2/

I use www.interactivebrokers.com but there are numerous others

Cheers
 
Hi WayneL,

Sorry I really didn't mean to put words in your mouth over the ASX thing, I was just trying to make sure you knew what I was referring to and hence the basis of my question. Now you have given me your reasons I have a good idea why someone would favour the US market over the ASX for the type of trading you are doing.

I will investigate your broker now and have a good look at the advantages you described, it certainly sounds great and I can only imagine how many opportunities there are in such a market.

Thanks for answering my question so quickly, I really appreciate it!
 
One more question if you don't mind, what do you use to chart the US markets, do you just subscribe to a seperate data feed and use your normal charting program?
 
Hello Wayne L, I also have a couple of enquiries if you don't mind. Because of some of your above reasons and a couple more of my own I'm interested in trading the U.S market also and are wondering how you find working those hours and what is a usual routine in your trading day or night, my style of trading usually entails watching the screen and I'm a bit concerned about the loss of quality of life many night shift studies and my own short experience with night shift have shown but the shorter market hours to the longer shifts of other jobs and at times not needing to watch the market may be alright. How have you found this? Appreciate your comments, regards Willow.
 
ctp6360 said:
One more question if you don't mind, what do you use to chart the US markets, do you just subscribe to a seperate data feed and use your normal charting program?
Click to expand...

There are a number of options

I use www.mytrack.com data with www.sierrachart.com for charting.

You can feed InteractiveBrokers data into Sierra Charts as well for free but the IB data doesn't backfill.

The majority use www.esignal.com and either use their charts or feed the data into a 3rd party charting software such as www.fibonaccitrader.com www.amibroker.com or ensign software (or numerous others)

If you are happy to update charts periodically during the trading session, with 20 minute delayed data, you can use free Yahoo data with Amibroker (You will always have your live prices through your brokers platform.

Oh and look up Tradestation Securities. They will supply a Tradestation charting for free if you trade often enough with them.

Thats just a few of the he more polular options, but the choice is tremendous.

Cheers
 
willow said:
Hello Wayne L, I also have a couple of enquiries if you don't mind. Because of some of your above reasons and a couple more of my own I'm interested in trading the U.S market also and are wondering how you find working those hours and what is a usual routine in your trading day or night, my style of trading usually entails watching the screen and I'm a bit concerned about the loss of quality of life many night shift studies and my own short experience with night shift have shown but the shorter market hours to the longer shifts of other jobs and at times not needing to watch the market may be alright. How have you found this? Appreciate your comments, regards Willow.
Click to expand...

Well this is all I do, so the night shift is something I have gotten used to. If I'm feeling a git tired, I'll set up some audible signals and grab a few ZZZ's. If a price point is reached the alarm will wake me up.

Another thing you can do is set entry/exit stops, that will stop you in or out while you're in the Land of Nod.

There are many ways to skin this cat, and you don't have to be awake all night.

Cheers
 
Wayne, What are some leverage options for US equities?

My IB account allows 50% gearing only.

I'm currently investigating US stocks and like what I see.
 
WaySolid said:
Wayne, What are some leverage options for US equities?

My IB account allows 50% gearing only.

I'm currently investigating US stocks and like what I see.
Click to expand...

One way to increase leverage is to use deep ITM options where the delta is .8 - .9. This will virtually nullify vega risk and theta is virtually a non-issue.

This is another attraction of the US market in that you can go a long way from the money and still have a market and even a normal spread in the larger cap stocks.

Example:

INTC is trading @ 20.70 at the minute

the march 17.50 calls are @ 3.20 bid / 3.40 ask

You could split the spread if you trade small (or small parcels at a time ;) ) and be filled most likely, as the MM will not want to show.

So at 3.30 you are trading with only 16% of your capital.

Significantly, this option is .94 delta and extrinsic value is only 10c, so this will mimic the underlying very closely

You also have a built in stop loss at 17.50 and all the gamma is on the downside of your trade price. What this means is that...supposing INTC does trade down to 17.50 before expiry, your option will still have some extrinsic value, lessening the loss that would have otherwise have been with shares.
 
wayneL said:
One way to increase leverage is to use deep ITM options where the delta is .8 - .9. This will virtually nullify vega risk and theta is virtually a non-issue.

This is another attraction of the US market in that you can go a long way from the money and still have a market and even a normal spread in the larger cap stocks...........
..............
you also have a built in stop loss at 17.50 and all the gamma is on the downside of your trade price. What this means is that...supposing INTC does trade down to 17.50 before expiry, your option will still have some extrinsic value, lessening the loss that would have otherwise have been with shares.
Click to expand...

Just read the post Wayne, great stuff, is this what they call a 'synthetic long'? (or do you have to buy a put as well to earn that tag?).

Have you tried this during your recent forays on the ASX? I recall you said there wasn't much liquidity in the ITM series?
btw, thought you might like to see the pretty screenshots here http://www.voptions.com, those 3D diagrams probably make more sense to you.
 
RichKid said:
......
Rich, not a synthetic long. A synthetic long is a bought call and a sold put at same strike and expiry. (Usually ATM or fairly close to the money)

However the deep ITM call could be termed a "stock replacement" strategy, as delta is so close to 1.

Here in Aus you could prolly find some reasonably liquid delta .85 ITM options not to far from the money, because of the relatively low IV's.

Cheers

PS Nice charts but couldn't really nut them out. Pretty colours and patterns though :D
Click to expand...

Thanks wayne, nice term, will do some searching for liquid ITM's. Guess those 3D charts are just to bedazzle newbies.
 
While there are some great reasons to trade the US,its not having a boom.

Why eat steak abroad while you can have Lobster at home?

Yeh I know you dont like lobster.

Go where the money is and go there often!
 
tech/a said:
While there are some great reasons to trade the US,its not having a boom.
Click to expand...

rofl are you serious?

s&p 500 at all time high
nyse composite at all time high

these are a few of the BROAD indicies showing the U.S is in a BULL market. Just because the Dow (only 30 stocks) is a few points below its all time high doesnt mean theres not a bull market.
 
Just looking at XAO compared to DJIA

Since lows in October both indexes.

DJIA up 15.84%
XAO up 23.25%

Thats 46% better here at home.

Steak and Lobster.

Im not saying Bread and Water V Lobster.
 
"past performance is not an indication of future performance"

I would have thought with a name like tech/a you might be able to spot an opportunity presenting itself in the charts......especially after all those posts of yours on the subject of opportunity........

The XJO is done. Cooked. No value left.

The SPX however has good valuations, good technicals and a weak dollar (foreign investors see even cheaper stocks in their $$$)

As I said a while ago, the Dow is headed for 20,000. Is the XJO headed for 10,000? Me thinks not.
 
As I said a while ago, the Dow is headed for 20,000. Is the XJO headed for 10,000? Me thinks not.
Click to expand...

Short or longterm?

We can argue veiw points infinitum and economists are split,just as we are.

I feel that the XJO will outperform the DJIA and continue to do so.
Rising A$ rising exports decreasing debt,Falling US$ increasing debt.

Exciting times where opportunity abounds.
 


Write your reply...

Similar threads

S
Share some knowledge about day trading the ASX as a mentor
Replies
6
Views
3K
Assasin
Assasin
Fiona96
Trading US Stocks
Replies
3
Views
2K
karenjones
K
SirRumpole
Fun with ChatGPT
Replies
18
Views
931
JohnDe
JohnDe
greggles
Grok's High Probability Trend-Momentum Breakout System
Replies
9
Views
960
divs4ever
divs4ever
Fiona96
ATO Tax!
2
Replies
20
Views
3K
dyna
D
Top