Using VIX in Exposing Complacency While much has been said about the efficacy of the VIX to expose rising fear in the market, the index also deserves at least the same amount of ink spilled for its ability to expose rising risk appetite, sometimes also known as rising complacency. The chart illustrates how…
Syndicated article from article base Today, in the market there are many automated tools available which makes the trading easier, faster and more importantly the deals are carried out by keeping into account the strategies formulated by the experts from the all over the world. While some forex tools are really good and stand up…
The volatility index (VIX) measures the volatility of a wide range of options on the S&P 500 Index and is used to gauge the markets’ expectations for volatility over the next 30 days. Quoted as a percentage, a VIX figure greater than 30 is associated with high volatility resulting from investors’ fear of uncertainty,…
Due to structurally low interest rates in Japan and Switzerland, the yen and the franc often served as funding currencies, used by speculators to borrow in lower rates and invest the proceeds in higher-yielding currencies and other assets such as gold, oil, and equities. Both the yen and franc have commanded interest rates lower than…
Borrowing money at low interest rates to fund higher-yielding loans has been the conventional source of revenue for banks for as long as credit currency carry trades, whereby hedge funds, asset managers, or individuals borrow funds in low-yielding currencies (funding currencies) to convert and deposit the proceeds in bonds or certificates of deposit in higher…
2003: DOLLAR EXTENDS DAMAGE, COMMODITY CURRENCIES SOAR The major differences distinguishing the global economic/market environment surrounding the 2003 dollar sell-off from that of 2002 were (1) the breadth of the commodity rally; (2) increased geopolitical uncertainty weighing on the U.S. dollar and U.S. assets after the outbreak of the Iraq war; and (3) deteriorating budget…
WORLD INTERVENES AGAINST STRONG DOLLAR (1985–1987) The excessive strength of the U.S. dollar proved detrimental to the world economy. The U.S. trade gap moved sharply into a deficit and millions of manufacturing jobs were lost. Sharp depreciations in the currencies of the United States’ trading partners triggered surging inflation that required central banks to…
The First Dollar Crisis (1977–1979) The U.S. dollar rebound of the mid-1970s came to a halt in summer 1976. What followed in the second half of the decade would be a five-year decline in the currency, unprecedented in the new post–gold standard era. [ad code = 3] Jimmy Carter’s presidential campaign against Gerald…
Forex Brokers If you are trading or have traded in the Forex market you must have heard about Forex brokers. As a trader, you might not know what a Forex broker is and what they do exactly.
Today’s Forex Market Our nations turmoil has led investors to lose confidence in the dollar verse other currencies. If you think about it, the best economic indicators we have can be traced back to currency fluctuations. Investors buy and hold currencies in good times, and sell in bad, to pay the bills at home….