An Insight on Pair Trading and How it Works

Pair trading essentially consists of investing in two stocks simultaneously. One being a long position one and the other being a short position one. These two stocks must always be related to one another. That is it must always move in one same direction. These stocks belong to the same industry sector most of the times, for example one stock of a General Motors and the other one being Ford. These stocks tend to move in the same the direction due to their nature of the business. One must be wondering then how pairing of these stocks provide a trading opportunity? It is when the two stocks, which are moving in the same direction diverge, that gives the trader an opportunity to trade and make profits.

Pairing trading requires a considerable amount of ground work to be carried out before venturing to invest in one. The smart strategy is to buy one stock that is under performing and sell a short-position out performing stock. The pair trading remains unaffected by the over-all market trend only as long the pairs are in synchronization with one another. Even if one stock falls and the other one surges up, buy as long as they possess a tendency to come back together in sync, a profit is made. The essential point that the stock market advisory services stresses on having a good discretion while selecting a pair of stocks to trade.

There are various technical tools for stock analysis available in the market that allows taking traders a shrewd decision with the help of various deviation charts and techniques. However, it is not that simple to pair trade as there are numerous factors that are to be considered to mitigated the risks or control them in case one is not able to avert. One os the major risk that is to be considered is that the divergence period between two stocks can last longer than expected, thus hampering the expected normal course of the trade. In such cases, it is best advisable to follow the long term trend following system by the stock market advisory services to predict the divergence period between two stocks. Thus traders must always draw a line when to exit from the stocks in order to avoid dire catastrophic trading conditions.

The best way to master the technique is practicing the trade over the course of time another factor to be kept in mind while trading with the pair of stocks is the volatility of the stocks. It should not happen that one stock is highly volatile in nature while the other is not. If such is the scenario then the divergence in the prices for a longer period of time is bound to happen and traders might not be able to reap as much benefit as desired. Hence, opting for highly correlated stocks with very less volatility is the key to carry out a successful pair trading at all given times.

Author Bio:

Indices Master is one of the best stock market advisory companies in India. They have years of experience in area of quantitative trading and equity research. Indices Master is a SEBI registered company.

Benefits of Investing with SEBI Approved Investment Advisor

Investing with a SEBI approved company has always has its own perks. Making an investment advisor get registered with SEBI has always ensured that trader’s security and interests are protected at all give times. The traders are always in safe hands with SEBI registered advisor firms as the registration of the firm involves a stern process of validating the identity and credibility of the advisor. The SEBI grants or validates the certificate of the firm only after five years from the date of issue.

The SEBI registered stock market advisory services always hold ample efficient knowledge of the finances and the stock market as giants other firms who might not be well versed knowledge to guide their clients. Most of these best stock trading advisory services have their own tool for discreetly analysing the history of a stock portfolio and its potential risks to help traders avert them as efficiently as possible. The charts of complex deviation techniques among many other are employed to assess the long term trend following system and evaluate the clients’ experience with the trading firm. Different audit reports of various portfolios are present with the SEBI registered firms which helps to investors to assess the performance of the stocks. Based on the history of the stocks, the traders are able to decide better which stock is worth investing and which one will reap the expected desired results.

A SEBI registered firm are required to maintain a record the traders’ transactions, its history is maintained and duly signed by the authorities for the future reference and to evaluate the trading performance and discern any mistakes that might have occurred during the course of time which in turn might help traders to assess their future transactions. Since all the registered firms have their own trading tool most of the given times, the advisors have a prudent knowledge of the all the statistics and technical analysis which helps the investors to take better decision on investing in a stock portfolio.

Any firm which is recognised by the SEBI gives traders and an assurance of all their trading transactions and leaves them content and in safe hands. An approval from SEBI is nothing but a Government approval of a safe and secured way of trading in the Indian Stock Markets. Indices Master being one of the SEBI registered firm ensures that its traders carry out a secured transactions under the expert guidance from the team of financial advisors to ensure not only to build a vast expanse of clients but also to build a trust worthy trading companionship.

Hence investing with a SEBI registered firm is by the far the best technique to trade safely and reap good harvests on investment. Since the capital of the trades is secured with the registered broker, it allows for a stress-free transactions wherein every single transaction it notified to the traders via email. Hence a trader is well informed of every penny that is being transacted.

Author Bio:

Indices master is extremely prominent when it comes to the service they provide. They are considered as one of the most successful advisor for trading in stock market with having a great experience. Indices Master is a SEBI approved investment advisor.

A 360 degree view of investing in an Initial Public Offering

Most large scale companies are ‘go-public’ as popularly known to make a part of their shares public to allow them to trade in stock markets. These firms mainly go public to raise funds and that too in unprecedented large amount in the firm’s history. When the shares of a firm are publicly traded, it opens many financial opportunities for it. Being under a high scrutiny of the stock exchange board, the IPOs amass huge wealth when they issue a debt. The traders can reap benefits in case of any mergers or acquisitions.

Stock trading advisory services make it a point to give a fair idea about a private company who is set to offer an IPO. It may so happen that private companies share most of the information but sometimes tend to keep a few vital piece of information to themselves before going public. In such cases, it is advisable to learn every minute details of an IPO Offering firm. Right from its previous and current financial statements to press releases to its competitors and its overall health in the industry before investing in the IPO.

While doing a thorough ground work of the firm before the release of its IPO, the best stock market advisory services recommend reading its prospectus thoroughly before making an investment. The traders get to know potential risks or promising opportunities while reading the prospectus. The traders also get to know the amount raised by the IPO will be used for what purposes. The traders get a deep and a thorough insight about the money being invested by the firm. Being cautious is the key to reap successful harvests from an IPO.

Another myth that needs to be busted here is that not every company who decides to go public must necessarily be doing financially well. Always remember to take calculative risks before to make an investment. The Indian Stock market advisory services always vouch for never to follow the herd mentality. If there is a much talked about IPO, much hyped IPO to be released then it may not necessarily be the best one to invest in. Therefore, it is a foremost requirement to shrewdly asses an IPO, read its prospectus carefully before decide to invest in it.

Hence delve into investing an IPO only you have a sceptical mind and a shrewd mind with a habituated way to charter the Pros and Cons of every IPO that you target to invest. The expert stock market investment advice would be to sift through the good and the bad IPOs and only then come to a conclusive decision to decide the best for you.

Author Bio:

Indices Master is one of the best stock market advisory companies in India. They have years of experience in area of quantitative trading and equity research. Indices Master is a SEBI registered company.

How Investors Benefit from Algorithmic Trading

Before knowing the inside-out of the Algorithmic trading, investors might wonder as to why is the algorithmic trading gaining much popularity lately and why is it so many of the stock investment advisers vouch for implementing the algorithmic trading. After having read the reasons one might conclude that it has been in the lime for so long for all the reasons worth applauding.

The investors gain a major benefit by investing in the automated trading with its unique features like the lightning speed with which the system executes the transactions, the cent per cent accuracy in the trading, minimal extraneous trading costs. Since the system is automated and feed with the data previous and the current data of the portfolio, the transactions are being carried out swiftly even before the investors realize by following an efficient algorithm. The transactions are being carried out even before any human mind can perceive. This gives a significant upper hand over the manual trading techniques initially employed by investors.

While trading with multiple stocks simultaneously, the automated algorithmic trading system, like iTrend, scan the previous history and the current records of the all stocks into consideration all at the same, hence giving the investors a fair idea of all the stock at one time to make a better decision whether to book the profits or not. The added benefit is that the system also depicts the long term trend following system of all the stocks for the investors to take a shrewd decision.

The cent percent accuracy of trading is one of the major forte of the algorithmic based trading systems. There are no pitfalls for the investors to beware of and they can trade hassle free without any worries. The glitches of the manual trading have all been taken care of in Algo trading. The labor of manually entering the stocks is totally eliminated leaving ample spare time to the investors to plan a bigger venture in the stock.

Initially investors had to pay an extra sum of amount to keep a track of the stocks in the markets. With the advent of the algorithmic trading, the extraneous costs spent on monitoring the markets are completely eradicated since all the markets are automatically monitored by the best trend following system. The transactions can be carried out without the constant supervision.

Back-testing may be considered as another boon for the algorithmic based trading as all the previous history any stock that has been listed in the past in the share markets can be easily studied for and analyzed to carry out an effective trade in the future. The stock option advisory services help to educate the investors about the back-testing so that they can take an informed decision about the future trading.

Hence, a system that is developed to efficiently handle large scale automated trading can be beneficial in ways more than one. And enables the investors to mitigate the risks altogether and trade to get the best out of their investment.

Author Bio:

Indices master is extremely prominent when it comes to the service they provide. They are considered as one of the most successful advisor for trading in stock market with having a great experience. Indices Master is a SEBI approved investment advisor.

Curb risk factors using Algorithmic Stock Trading Technique

There are numerous risks involved in the transactions of the stock markets especially when the trading is being carried out in the traditional way and there is no electronic means to foresee the risks and take informed decisions. This is when the modern day algorithmic trading techniques are of a great aid to the investors.

A huge amount of data is of a particular stock of a firm is analyzed using the Data Analytics. Every record of a stock right from its initiation to the current date performance is recorded and analyzed to determine whether a particular stock is worth investing in or not. Algorithmic trading also popularly known as the Algo Trading, also makes an analysis of the potential scope of the growth of a stock in future. This helps to minimize the risks involved in the trading processing by studying the detailed trend performance of a stock. Apart from the discrete knowledge of the financial realms of the business, the stock market advisory services largely depend on the results deciphered from these trend analysis to give the best possible services to their investors.

Another factor that helps to minimize the risk efficiency of the algorithmic trading is the ability to draft accurate graphs, charts in the form of bar graph, pie chart, histograms or line charts for the investors to view the performance of stock at the very first glance and have a precise idea about the stocks to invest in. These stock technical analysis tools gives a quick and a precise idea about the sticks without having to manually go through the data tear wise. The visible changes in the figures help to accurately decipher the trend pattern without consuming much time.

Every possible level of customization can be made in algorithmic trading on the programming front to eradicate any error that might occur by human calculation. All the decisions are taken by the system at the fraction of a nano second thus enabling the investors to take quick effective decisions without any errors. Indices Master is one such Indian stock market advisory services which serve its clients with an efficient stock trading tool.

One of the other key features that help to curb the risks is the best trend following system which enables the investors to evaluate one’s trading strategy based on the previous historical data. This particular technique helps the investors to have an idea about the effectiveness of particular strategy had it been applied in the past for trading the stocks and what effects it would have bore on the performance of the stock. This strategy is popularly known as back-testing which helps to mitigate the risks to a great extent in the algorithmic trading.

Hence by employing a various techniques like back testing, forward testing(to predict the future growth), customized parameters of trading and generating and optimizing the portfolio, one can achieve maximum profits with minimum risks under one umbrella in equities, NIFTY, Forex or any other future markets.

Author Bio:

Indices Master is one of the best stock market advisory companies in India. They have years of experience in area of quantitative trading and equity research. Indices Master is a SEBI registered company.