What is Medicare Part A?
Medicare Part A is the standard, baseline hospital coverage that comes at no cost as part of everyone’s Medicare benefits. It will pay for inpatient stays at hospital and skilled care facilities, but only for a certain number of days. Medicare Part A is hospitalization and inpatient care insurance. It will pay fully for about 20 days of care, but only if there is an inpatient procedure first and the patient appears to be convalescing. If the patient is not gradually recovering, their Medicare benefits will be suspended. Continue reading...
What is the Ascending Triangle (Bullish) Pattern?
The Ascending Triangle pattern forms when the price of a pair tests a resistance level and creates a horizontal top line (1, 3, 5), with an upward-sloping bottom line (2, 4) formed by a rising support level. The breakout can either be up or down, and it will determine whether the target price is higher or lower. This pattern is commonly associated with directionless markets, since the contraction (narrowing) of the market range signals that neither bulls nor bears are in control. When the price of a pair consolidates around a certain level, it may indicate growing investor confidence for a significant uptrend. Continue reading...
What is a Balance Sheet?
A company's balance sheet gives a picture of how all the assets, liabilities, and equities of the company "balance out." The basic accounting equation is Total Assets = Total Liabilities + Equity, and a Balance Sheet is going to detail these parts to show how everything adds up at the time of the report. With things equal on both sides of the equation, the company's books are balanced, the same way someone might go back through the carbon copies of checks they've written and "balance the checkbook" to make sure all checks written have been accounted for. Continue reading...
Is there such a thing as the “NFL effect?”
The “NFL Effect” suggests that the outcome of the Super Bowl can foretell market behavior. Some market statisticians have analyzed the correlation between the behavior of the stock market and the winner of the Super Bowl, and suggest that the DJIA will go up or down depending on whether the winner was from the AFC conference or the NFC conference. While the Super Bowl indicator has been right 33 times out of 41, to serious investors, this correlation does not imply causality. You can find lots of other time-series which are also strongly correlated to the stock market performance, such as the number of sunny days in the previous year. Continue reading...
What is index investing?
The main idea behind index investing is that markets are efficient, and, especially with the low fees of indexed funds, it can be a winning strategy. Index investing is a simple strategy of choosing the indices which reflect your investment beliefs and offer diversification, buying mutual funds or ETFs that track these indices, and holding them for a long period of time. The last 10 years have seen the propagation of index funds for any specific market, industry, country, commodity, etc. Continue reading...
Can I choose good investments?
There’s no reason why you shouldn’t be able to choose investments that are suitable and beneficial for you, without a personal investment advisor, if you’re willing to learn. There is an abundance of information out there, and if you have some discernment you are likely to be able to find investments which will serve their intended purposes for you. You may have heard that there are different investment objectives: preservation of capital (avoiding the risk of losing money - especially which keeps up with inflation), growth, income, and mixtures of these. Continue reading...
What are trading models?
Trading models are emotionless systems for decision-making in trading that can be automated or just used for reference. They tend to have logical parameters, such as “if x, then y” which can use popular trading indicators to implement a strategy that might only be used in certain conditions. Trading models are strategies employed with a specific design. Different trading models will use different technical indicators or types of charts to define and search for certain conditions in which a strategy can be used. Once the conditions are met, the model provides the decision-making logic that is intended to carry out a profitable trade without guesswork or emotion. Continue reading...
What is dollar cost averaging?
Dollar cost averaging (DCA) is a method of hedging against the risk of investing a lump sum at high market prices. With DCA, the investor deploys money at set intervals, hoping to get the best average price per share. If you use the same amount of money to buy shares at set intervals, you will acquire more shares when the market is down, and fewer shares when the market is up, so theoretically you would have acquired more of the advantageously-priced shares overall and will be in a better position in the long run. Continue reading...
What is adaptive price zone?
Adaptive Price Zone is a volatility-based trading indicator. Similar to traditional Bollinger Bands, Adaptive Price Zone is a recent development by Lee Leibfarth that overlays two indicator bands around a moving average line. It is more adaptive than many previous band indicators, using several short-term exponential moving averages which are double-smoothed and closely hug changes in volatility and price data. Exponential moving averages give more weight to recent data, which helps the lines hug current data. Continue reading...
What is a call time spread?
A time spread using call options is a strategy that buys and sells the same number of options with the same strike prices, but different expirations. Time spreads are sometimes called calendar spreads or horizontal spreads. They make money based on the time decay of the options being shorted. Two calls are used: one is shorted and one is purchased, and both have the same strike price and same underlying security. Continue reading...