pappy2000: The underlying asset can be indices,frex or commodities.

Let's assume that the underlying asset is FX. If, as you stated earlier, you start buying up dollars on the basis that the price of dollar (relative to the naira) will go up; then that's not trading in derivatives. That is simply trading in FX and following the rule of 'Buy Low, Sell High'. Derivatives come into play when you start dealing in options, swaps, forwards, etc and other complicated transactions which are built on top of one another to the extent that people no longer have a good understanding of the products they are trading.

Let me give you an example from the last financial crisis. The example is Mortgage Backed Securities (MBSs) in which the underlying asset or financial product is the mortgage. However, financial innovations created MBSs. In turn, the MBSs were bundled into a collaterized debt obligation (CDO). The CDOs-squared were created by using other CDOs as collateral. And then CDOs-cubed were created by combining CDOs and CDOs-squared. Even higher-powered CDOs were created.

You see that is not the end of the complexity. Credit default swaps (CDSs) were created to protect you from default on the CDOs. Indeed, there are many more financial derivatives [/b]that make up the potpourri that is modern finance.

I tell you, at this point many people would have got confused including, you may not believe it, the people dealing with them. However, the [b]point is that the underlying assets (the houses in the mortgages) and economic activities (the income-earning activities of those mortgage-holders) were being used again and again to 'derive' new assets.

You need to note something very important: whatever you do in terms of financial engineering or ingenuity, whether these assets deliver the projected returns depend ultimately on whether those individuals who hold the original mortgages fall behind their mortgage payments or not.

This is why I sounded my note of caution to those who want to deal in financial derivatives: if you make an existing building taller without widening the base, you increase the chance of it toppling over. As the degree of 'derivation' increases, it becomes harder to price the asset accurately.

pappy2000: Step3 is also a continuation of step 2.In step 4.we have the dialogue box [b]telling us either to buy or sell,You buy when you believe that market will rise and sell when you think will will fall.[/b]Then yu have the volume.....I need to d a good explanation of this.If you are trading a forex pair....the minimum is 0.1 ......If you recall i said that the standard lot is 100,000 dollars of the base currency.....now 100,000 times 0.1 gives 10,000 dollars which is also called the mini lots.hope that is clear but if you are trading shares on non forex asset then the minimum volume is 1.if yu put anything less than 1 the system will not accept it.I hope this is clear enough.For example if you are trading the ftse or dax the minimum volume is 1.I will stp here and wait for questions.

I salute your efforts to teach and impart knowledge but this is trading (fx) and not financial derivatives.

If one has an account of say $500 what is d volume u will recommend? E.g the alert u sent today how does one knw d apporiate volume to use?

pappy2000: why is this thread so dull.I need your contributions

Pukkah:

I salute your efforts to teach and impart knowledge but this is trading (fx) and not financial derivatives.

Nice analysis.....but we are not dealing with those complex financial derivatives you mentioned.We are dealing with futures traded on CBOE.I am aware that the platform i recommend hedge their bets on the CBOE and other futures exchanges so we are not dealing with CDS you talked about.I like your analysis please keep it up

All eyes on the Fed....waiting for the next decision

I will be giving a trade on the Asx200 based on china Pmi by 2pm

sell the Aus/Usd

we are waiting for the policy decision for policy maker from both sides of the atlantic

waiting for ECB President

The Time is 1.45pm Nigerian Time

The ECB will need to maximize its Firepower

spanish 10 year bond is down by 6 basis point.....Dont do any trading now,Anything you do before the press conference is either you are trying to play God or Gambling

deniQ:

Dis na ogbonge kwesshon nah. Pappy pls respond & kowaciate. Ur ppl nid 2 kno how 2 strike gold. We re eagerly awaiting ur answer bozz.

I will say use a leverage 1:20 which means 1 micro lots

pappy2000: spanish 10 year bond is down by 6 basis point.....Dont do any trading now,Anything you do before the press conference is either you are trying to play God or Gambling

Welldone Pappy, got your message. i will get intouch with you soon.

Sell at the GOld

pappy2000: sell the Aus/Usd

I think this is pure Forex Trading not any derivatives just like Pukkah said.
Isn't it?
I am seeing a price action set up on AUD/USD, NZD/USD and probably EUR/USD.
You may wait till the close of trade today, and then look for further confirmation
tomorrow before u strike.

@pappy2000, pls I just want to know maybe if I can start betonmarket with just 100$, like what percentage can you recommend for me to use. I want to fund my account by tommoro I want to use my GTbank naira mastercard. Pls I need your sincere advise.

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Sell the following
Nikkei
The ASX 200
The Singapore Index

pappy2000: Sell the following
Nikkei
The ASX 200
The Singapore Index

Pappy you are doing a great job.
is dis alert applicable 2 BOM traders?
if yes, why nt include duration to your alerts
it matters alot

dagr8:
Pappy you are doing a great job.
is dis alert applicable 2 BOM traders?
if yes, why nt include duration to your alerts
it matters alot

For those who called me i told them 0 days

Sell the Ftse100,Sell the dax,sell the Cac 40 .

pappy2000:


For those who called me i told them 0 days

So hw do i call you naw?

dagr8:
So hw do i call you naw?

you dont need to call me but its 08098515301

Whats happening to this thread?

People are just watching withput commenting.I dont claim to know it all I want response from people like you

European Stocks set to open lower.....The Ftse,the dax and cac and the ibex will open lower on weaker than expected number from china

My predictions were right,now we have the major indices downo thanks to china

I am going to do an xray of what is expected next week

For those who are part of the my free alert service,I stayed out of the market last week because of the volatility in the market.We have a lot of bad numbers coming out of China and the markets expect that policy makers will do QE3 so the sell off was not massive so its was so confusing.I cant afford to gamble with people's money
Now let me give a snapshot of what to expect for the week.
On Monday 12th August 2012.
Expect a lot of storm on two assets namely Eur/Jpy and the Nikkei 225 (also called Japan Index on BOM platform)
Markets expect contraction in the Third largest ecomony.
On Tuesday 13th August 2012
Markets will await the German Gdp at 7.00am Nigerian time .An hour before the German Markets opens.The report will greatly affects the opening number in the Dax(called German index on BOM Platform)
9.30 am Nigerian time ....Markets awaits uk CPI.
Eurozone GDP comes up at 10.00am Nigerian time
Then the almighty Us Retail Number comes out by 1.30 Gmt.....Friends this one is free one if you know how to trade this report.I will be given this report exclusively to my FEE.You can contact me if you desire this.You cant get it wrong because markets moves when this reports comes on board.

On wednesday BOE Minutes and Uk jobless claim will be the focus of investors that report comes out by 9.30 GMT
Also on Wednesday Usd CPI comes out at 1.30 GMT......that report will move market......You can use that to book a profit on the S & P 500 and Japan index.This report is 100% sure if you know how to trade it.This report also comes with a little Fee.So it will be good if you contact me in advance
On thursday the Eurozone Cpi will be on focus.This report will be free here
On Friday
German PP1 comes out at 7.00 am Nigerian timeand the University of Michigan Consumer Confidence report comes up at 1.55 pm Nigerian time.
Now,I have changed the tactics of my alert.You only pay for Important Economic News that I know will hit the markets and it wont be a monthly affair because sometimes I am not available and with that I dont think it will be fair to the people that have paid.
The reason for me charging is that I subscribed to three important data service provider.The Bloomberg terminal which cost about $1300 though i partnered with other people to pay for the service.So in other to save some of my cost and since most of us will benefit directly i think its fair if you pay a token.For report which does shake the markets I will give that for free here on my thread but for those big ones you need to have the soul of the markets with you and get insight into what other markets players are doing.so you need to pay for this.and you can only get that with bloomberg terminal you see the level two markets and level three and see what the big boys in the markets are doing and you position yourself according.

For this week,The big reports that you can trade and i believe will move the markets swiftly is the
The Us Retail Sales Number
The Us Consumer Price Index
The Eurozone GDP
University of Michigan Consumer Confidence
If you position yourself according even if you are a BOM player you can make a lot of money from this report.For this Four report I will be given it straight to your inbox for just 1,000 Naira only.If three out of the four premium predictions dont come true then you can call for a refund or wait till next week if i am given a new report then you dont have to pay.
So I am so sure of my reports.So you can give me a call on 08098515301.
Other medium moving report will be here for free but this four once will be sent directly to your phone if you pay.
You can pay into my GTB Account and you use your phone number as the depositor. My account is
GTB
0015325001
Babatunde

I have created this service partly to fund back my subscription and also to give people value for money so you have nothing to loose and if you are on BOM.The timing will be stated clearly without confusion.This is an innovative product which will help you and me.