Weekly Post

TME 032: Dow Jones

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What Is the Dow Jones Industrial Average?

Today we are going to talk about the Dow Jones Industrial Average. What is the Dow Jones Industrial Average? The Dow Jones is a stock market index. It has been around since 1896. The Dow Jones index shows how 30 large public companies trade during a session. The Dow Jones index gives an investor or trader a picture of what the overall United States market is doing on a particular day.

To give an example of how the Dow Jones works we will turn to the manufacturing industry. In the manufacturing industry a product is built. Many companies will have quality checks on a certain number of products. If they make 500 widgets in a day they may check 30 for quality defects. The 30 widgets are a sample. With a good sample size a manufacturing plant can tell what is going on with the widgets.

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Uncategorized

TME 031: 1987 Stock Market Crash

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I remember eating with the family as a child. The news was on and they were talking about the stock market. My dad had money in the market so he was listening intently. The year was 1987 the date was October 19 and it was a Monday. It is also known as Black Monday. The crash began in Hong Kong then spread to Europe and then to the United States. The Dow Jones dropped 22.61%. The crash of 1987 was not the worst crash in history but it was a biggest one day percent loss in the history of the Dow Jones Industrial Average.

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Trading System, Trend Following

TME 030: Market Trends

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Market Trends

We have talked a lot in the past about trend following but how do we find market trends? We can talk about a method all day long but it would also be good if we talked about how to do it. Markets trend up and they trend down. How do we find those market trends?

To some people the market is like a rollercoaster. I’m not the type of person that likes rollercoasters. Sometimes when you go to the movie theater they put up a simulation of a rollercoaster on the screen. If I follow that close enough I feel like I’m getting sick.

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Trend Following

TME 029: ETF Trading

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What is An ETF?

An ETF or Exchange Traded Fund is a marketable Security. An ETF can track an index, a commodity, a bond, or a basket of companies. ETFs typically have lower fees than mutual funds. They trade like stocks. The price of an ETF changes throughout the day.

What is ETF Trading?

If you could come up with a fund that is perfect for the small trader it would be an Exchange Traded Fund. Mutual funds have been around for years for the buy and hold investor. Mutual funds offer diversification to the buy and hold investor.

ETFs have been around since the early 80’s but they have gained popularity just recently.

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