BC TRADING
Saved by @Mollyycolllinss

1/ What Happens with More Funds than Stocks? (Madhavan, Sobczyk, Ang)

"Funds differ meaningfully in terms of individual stock holdings, and we examine the factor exposures of the typical fund and the cross section of holdings of different funds."

https://t.co/d6vU4Fgszg

 2/ * Data on fund holdings are from Morningstar
* Sample: Jan. 1, 2007 to Dec. 31, 2018
* Only funds with at least 80% of holdings from the Russell 3000 universe are considered
* Mean AUM-weighted expense ratio for mutual funds (ETFs) is 70 bps (14.2 bps) as of Q4 2018
3/ "The holdings of ETFs and active mutual funds across U.S. stocks can be efficiently summarized by approximately 10 canonical funds.

"There is more commonality explained by the first few canonical funds for active mutual funds than for ETFs."
4/ "Commonality among equity mutual funds has remained approximately constant, but there has been increased dispersion in ETF offerings.

"We see no apparent rise in concentration or crowding for mutual funds over the period from January 2007 to December 2018."
5/ "We examine commonality in active mutual funds in Morningstar style box categories. While Value and Blend commonality has remained roughly constant over the period 2007-2018, Growth funds have exhibited a marked increase in crowded positions."
6/ "Crowding is greater in factors than in individual stocks for both active mutual funds and ETFs. Factor crowding has remained relatively constant over the period examined."
7/ "The first archetypal “fund” that approximates the whole active fund universe is a market-cap index.

"The second most important is value-growth exposure.

"For ETFs, unlike active funds, the second degree of differentiation reflects both value-growth and sector exposures."
8/ "Overall, the first approximation of the stocks held by funds is that the stocks tend to be large growth stocks. In an additional second approximation, funds tend to hold stocks that are smaller with higher volatilities."
9/ "Price discovery of underlying stocks in the S&P 500 can occur through ETFs or through trades of the stocks themselves—but this has only been the case since 2015. Before then, there were fewer listed ETFs that held S&P 500 stocks compared to number of stocks in index itself."

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Emperor\U0001f451
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CHEAT-SHEET

Multiple Confirmation short.

A Short Entry that we shared in 2020.

Study it point wise.

1. Bearish Candle type and lowering of volume on Price rise.

2. OBV divergence.

3. Accumulation with Bearish candles and Volume increase on Price decrease.

STUDY IT!


Explanation

1. When price increases with a decreasing volume, it's bearish.

2. OBV, On Balance Volume should be correlated with price.
If price increases without similar increase in OBV, it's bearish.

3. During consolidation, if the volume increases during dumps, it's bearish
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@Traderknight007
Overthinking - The art of creating problems which weren't even there.

Thread on How Over-analysis leads to decision Paralysis-


What is Analysis paralysis?

In simple terms, analysis paralysis is a person's tendency to over-analyze or over-think upon a decision to such an extent that he/she fails to make a choice resulting in a paralyzed state of inaction.


How a retail trader trades-

A trader named Rahul, He know all the basics of markets, He also has made a system which gives signals on nifty, he has also encorporated good Risk management and Position sizing into his system.

One day he gets a signal to buy Nifty at 13500 with stop at 13450, he wanted to take the trade, but he wanted to get sure that the trade he has take should be a winner.

So he says just let me check the RSI if its above this level I will buy , he checks it and it was above his

level, then again he wants to check another indicator named MACD, he wanted to get sure man, Now he do the most intelligent thing to get sure he gets right.

He goes to twitter and ask his twitter Friend Trader knight he ask him that should I buy nifty at 13500,
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Trader knight
@Traderknight007
"A trend once established, is more likely to continue than it is to reverse"

A thread on Trend (Market structure)-


A trend is a path of least resistance, basically the side where the smart money is betting upon.

And our work is to be on their side, to make some money.

Why do we use trend?

In an uptrend, the sum of the rallies will always be greater than the sum of the declines.

In a downtrend, the sum of the declines will always be greater than the sum of the rallies.

How to Find the trend?

There are 3 methods which one can use-

1. Swing points method.
2. Moving averages.
3. Trend lines, channels.

1. Trend identification by using swing points-

• UPTREND in simple words - Higher highs, higher lows

• DOWNTREND in simple words - lower lows, lower highs.


• Flat trend - The price stays in a range
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Indrazith Shantharaj
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@indraziths
Price + Open Interest (OI) + Volume = Deadly Combo

There are many tools for Open Interest. Options Decoder from @TrueData2 is one of the simple yet powerful tools on options and OI.

Below are the 10 Powerful Features of Options Decoder

Thread 🧵🧵

(1/N)


#1 - PE CE Difference

This feature combines the OI of call options and put options and plots against each other.

At one glance, we can know what big players are doing!

(If they are selling more CE means, they are bearish on the underlying instrument)

(2/N)


#2 - Advance/Decline

This feature displays all the F&O stocks in one place.

In one click, we can see the stocks in any order (like an increase in price, increase in OI, or decrease in volume, etc).

A highly useful feature for options traders!

(3/N)


#3 - Open High

This feature displays all the strike prices that have an open high (or open low) for the selected instrument.

If many CE strikes show "Open Low", then the market is bullish!

(4/N)


#4 - IV Price-OI Chart

This feature plots CE and PE vs. Open Interest (OI) for the ATM strike price.

Always Remember:

CE Long Build Up + PE Short Build Up = BULLISH

PE Long Build Up + CE Short Build Up = BEARISH

CE Short Build Up + PE Short Build Up = SIDEWAYS

(5/N)
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How to save tax when income is above 50 lakhs?

Here are 9 benefits of trading in a corporate account: 🧵

Collaborated with @niki_poojary

1. Make a Pvt Ltd Company.

Form a company with family members and trade under it. The family members should be directors of the company. Will explain why later.

Why form a company?
You will only need to pay 25% flat tax. Individuals have to pay 30% tax above 10 lakh profits.

2. Surcharge Benefits:

You will be charged a lower surcharge in a corporate account.

Check the picture below:


Total Tax Outlay:

The total tax outlay for individuals is 30% plus surcharge. If you really earn a lot (10 cr +) then you will be paying 42% tax.

Whereas in a company you'll be paying a maximum of 28% tax.

This is how rich people save a lot of their money by paying low taxes.

3. Expenses can be deducted.

All expenses can be deducted from a company account.

Companies:
1. First make a profit.
2. then deduct the expenses
3. & Pay tax on the remaining income

Individuals:
1. First Profit
2. Then Pay tax
3. Expenses with whatever is left.
ALL , TRADING , TAXES RATTIBHA

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MINUTE DETAILS ABOUT THE ATTACK ON SHAISTA KHAN AT LAL MAHAL

Remarkable Commando op

A long 🧵 but worth your time

Aurangzeb sent his maternal uncle Shaista Khan with powerful army over 1,50,000 on the request of Badibegum Sahiba, Adilshahi sultanate

1/


Shaista Khan entered Deccan to kill Chhatrapati Shivaji Maharaj & to destroy his empire. Shahista Khan captured a lot of province and fort of Chakan near Pune.

2/


Till 3 years he gave lot of troubles to the subjects of Chhatrapati Shivaji Maharaj and he personally made Lal Mahal his destination to live at , which was the property of Chhatrapati Shivaji Maharaj . Lal Mahal, where Chhatrapati Shivaji Maharaj spent his childhood.

3/

1. In the April 1663 Chhatrapati Shivaji Maharaj personally made a surprise attack on Shahista Khan in the Lal Mahal Pune.

2. Chhatrapati Shivaji Maharaj attacked with 300 soldiers at the midnight while Lal Mahal had strong security of 1.5 lac soldiers for Shahista Khan.

4/

3. He entered in Pune, he made a drama of wedding ceremony to enter in Pune near Lal Mahal.

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