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Black Casper

"Anyone can make money from a crash"....

40 posts in this topic

http://www.bbc.co.uk/news/business-15059135

Quite a eye opening BBC News interview with a independent market trader - Alessio Rastani - who told the BBC the rescue plan put into place "won't work" and that people should be trying to make money from a market crash.

Bit more background into the plan

Ministers from the world's richest nations are reportedly on the way to agreeing a deal for troubled eurozone countries.

Following the IMF meeting in Washington, the BBC understands that three elements have been discussed.

They include a so-called "haircut" of Greece's sovereign debt, meaning institutions holding Greek debt would have to write off half of what they were owed.

The plan also envisages an increase in the size of the European Union bailout fund to two trillion euros.

European governments hope to have the plan in place in five to six weeks.

Good discussion point and to get your opinions

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Basically, is it 'buy dirt cheap shares now' season in the hope they'll regain some value over the coming months?

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Basically, is it 'buy dirt cheap shares now' season in the hope they'll regain some value over the coming months?

on some level, but he did mention investing in Bonds now and looking more into hedging strategies

looking into how to make money in a downward market etc

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I just googled bonds to see what they are. I like the sound of them, when i (hopefully) get my bonus I might actually look into it.

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and not too long ago I was looking into buying shares etc

gonna have to be back on the case

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The markets are a clever mans Ladbrokes.

Anyone who tells me otherwise is chatting shit.

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NOT REALLY THERE'S A BIT OF A DIFFERENCE BETWEEN GUESSING A FOOTBALL SCORE AND MARKET TRADING.

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NOT REALLY THERE'S A BIT OF A DIFFERENCE BETWEEN GUESSING A FOOTBALL SCORE AND MARKET TRADING.

Oh Really?

All you're doing is hedging on where you see the stock or the market going.

How is that different to knowing the history and form of a horse?

The derivative is just another name for Red Rum

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BECAUSE A HORSE IS NATURALLY A WILD BEAST THAT HAS BEEN TRAINED BUT AT ANY ONE MOMENT IN TIME IT COULD NOT JUMP PROPERLY AND BREAK IT'S NECK.

THE STOCK MARKET IS A WHOLE DIFFERENT KETTLE OF FISH.

IT'S LIKE COMPARING A HOODY TO A JACKET SORT OF SIMILAR BUT NOT THE WHOLE 9 YARDS B.

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NOT REALLY THERE'S A BIT OF A DIFFERENCE BETWEEN GUESSING A FOOTBALL SCORE AND MARKET TRADING.

Oh Really?

All you're doing is hedging on where you see the stock or the market going.

How is that different to knowing the history and form of a horse?

The derivative is just another name for Red Rum

Lol you don't understand what hedging is mate.

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I don't, maybe shouldn't have used the word hedging.

But you know what I'm trying to get at.

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BECAUSE A HORSE IS NATURALLY A WILD BEAST THAT HAS BEEN TRAINED BUT AT ANY ONE MOMENT IN TIME IT COULD NOT JUMP PROPERLY AND BREAK IT'S NECK.

THE STOCK MARKET IS A WHOLE DIFFERENT KETTLE OF FISH.

IT'S LIKE COMPARING A HOODY TO A JACKET SORT OF SIMILAR BUT NOT THE WHOLE 9 YARDS B.

this whole post made me laugh for some reason :lol:

true though

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maybe the guy is hyping and he just wants people to start trading mad help economy

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thought this was about them fake car crash insurance scams

bingo

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NOT REALLY THERE'S A BIT OF A DIFFERENCE BETWEEN GUESSING A FOOTBALL SCORE AND MARKET TRADING.

Oh Really?

All you're doing is hedging on where you see the stock or the market going.

How is that different to knowing the history and form of a horse?

The derivative is just another name for Red Rum

Lol you don't understand what hedging is mate.

:lol:

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Smh.

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'govts dont rule the world, goldman sachs does' laugh.giffrank but true

lol he was saying he has dreamt on the day a crash would come coz he would make so much money from it, reminded me 1 time my mate said london riots was a dream come true 4 him and opportunists alike
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thought this was about them fake car crash insurance scams

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I'm sure this fella was talking about short sellin when he said hedging, short selling is basically hopin the shares go down in value to make £££. That's what a derivatives account could do for you, in essence we could all make alot of money with limited Market experience and just a good strategy as he said.

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Hedging is a form of insurance.it works best in volatile

Markets, like the one we are in now where people are governed by fear instead of rationality. The most simple way I can describe it is a form of insurance. If you buy a share at £10. And purchase a put at a strike price of £9 for say 50p. Even if the share falls to £1 in value, you can still sell it at £9 because of the put you purchased. However if the price rises to £10. You will only get £9.50 because you have paid for the insurance. Hedging is a way of limiting your losses. But your upside in this case is potentially strong. If the share price doubles, you only lose 50p of the profit in this example.

That's one type of hedging anyway.

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True, I'm sure the options markets will reflect this current state of affairs though calls and puts may be ever so slightly inflated (unless the options markets don't really play out like that).

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We've built our entire world on usury and greed. It's about to come crushing down.

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Whether you agree with his ethics or not you've got to respect the realness, he just went on BBC and said what nobody is prepared to say.

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Hedging is a form of insurance.it works best in volatile

Markets, like the one we are in now where people are governed by fear instead of rationality. The most simple way I can describe it is a form of insurance. If you buy a share at £10. And purchase a put at a strike price of £9 for say 50p. Even if the share falls to £1 in value, you can still sell it at £9 because of the put you purchased. However if the price rises to £10. You will only get £9.50 because you have paid for the insurance. Hedging is a way of limiting your losses. But your upside in this case is potentially strong. If the share price doubles, you only lose 50p of the profit in this example.

That's one type of hedging anyway.

lolwut

hedging example:

you are a gold miner

when you take your gold out of the ground it has a value of $1650 an oz

you therefore are long (you own) gold at $1650 an oz

as you are a miner of gold, you want to sell your gold for as much as possible and limit any potential losses

so you go to the market and you sell gold futures at 1650 an oz

if the price of gold rises above 1650 an oz in the future, great news, you are making money on your long position but losing on your hedge

if the price of gold falls below 1650 an oz in the future, no problem, what you are losing on your long position you are making on your hedge

the trick is to enter your hedge at a better price than your original position, that way you have locked in the price difference between your hedge and original position. so no matter how volatile the market, the price difference will not change and you will be guaranteed profit.

the way you make money more through a hedge is by managing your position size and using options (m12's explanation of the use of options in a hedging strategy is a little dubious, but at face value it is correct when he says it is like insurance).

if you want to get complicated you can also trade the delta's/vega's/theta's of the options which take advantage of time values and premiums.

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