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Trading halted as U.S. stocks plummet

axios.com

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Re: Trading halted as U.S. stocks plummet

#351

Post by thedance »

rsync wrote: post #317
walrus01 wrote: post #188

Serious question, is anyone watching this carefully and trying to determine when things will bottom out (perhaps in a week or two), to buy stocks, ETFs, and such at the bottom of the dip? Hindsight is 20:20 of course, but there's a number of equities that one could have purchased shortly after the 2008 financial crisis that proceeded to make significant gains between 2009 and 2019.

"Serious question, is anyone watching this carefully and trying to determine when things will bottom out (perhaps in a week or two), to buy stocks, ETFs, and such at the bottom of the dip?" I am watching very carefully to see if the VIX goes to an outlandish number, such as 90 or 100. To give some context, the all-time high of the VIX was ~80 during the 2008 financial crisis, etc. It is a fools errand to try to predi…

I think the VIX did hit 90 mid-session in late 2008.

Re: Trading halted as U.S. stocks plummet

#352

Post by guhcci »

tempsy wrote: post #278

Buy S&P puts as a hedge to save your account in times of extreme volatility. I had 270 strike puts for April I bought on Friday for $6 that jumped to $15 today and got my account to break even even though the value of my stocks went down.

Just have to be aware of vega in these market conditions though, with the VIX as high as it currently is options premiums are through the roof and if there is some breakthrough in a vaccine/resolution to the oil price war the IV crush can bite hard (learned that the hard way).

Re: Trading halted as U.S. stocks plummet

#353

Post by bluGill »

allovernow wrote: post #314
airstrike wrote: post #256

Earlier quoted context omitted.

> So don't worry, it's only us regular guys that get screwed. Big firms can still contact each other to make deals. And when everyone is selling, who do you think is buying? No one is moving much of anything for those 15 minutes

How do you sell stock if no one is buying? If people are selling, others are buying.

Market makers are buying - their job is to always buy or sell stock from everybody. They (generally computers, but humans traditionally) will always buy your stocks, or sell you stocks. Their algorithm is simple: buy for $.10 (or some other tiny number) less than you sell - if the amount of stock owned is too low raise the price, if the amount is too much lower the price. They pretty much always make money in the long run.

Re: Trading halted as U.S. stocks plummet

#354

Post by A4ET8a8uTh0 »

cglace wrote: post #274
A4ET8a8uTh0 wrote: post #231

Earlier quoted context omitted.

Would you care to elaborate? I would argue that guard rails and controlled falls are in opposition to actual free market. The qualifier 'completely' seems misplaced.

You would argue that rules set up by private institutions are in opposition to the free market? Even anarcho-capitalism doesn't go that far.

I think you are misrepresting my argument and attempt to dismiss it in an odd way.

I am arguing that rules set up by the market do not automagically enforce free market. I am arguing that rules explicitly do the opposite by introducing guard rails, which DO restrict movement in that free market.

Do you honestly believe that rules derive its effects from who sets them up?

Re: Trading halted as U.S. stocks plummet

#355

Post by adrr »

totaldude87 wrote: post #184

To be honest , the market was in dire need for correction, BUT wonder where we will be when companies starts reporting their quarterly results and impact of that. So far this looked more like a correction than a precursor to the recession. To make things worse, OPEC dropped bombs which spread the wildfire further..

Market was all screwed up because the interest rate was so low. If bonds pay nothing, where else do you put your money?

Re: Trading halted as U.S. stocks plummet

#357

Post by chungus_khan »

A4ET8a8uTh0 wrote: post #198
bilekas wrote: post #180

Genuine question: They can just do that ? Issue a trading halt because they don't like the direction it's going ? > “There’s a reason why they have those circuit breakers -- it’s to give people time to come back from panicked feelings,” Seems strange that the market is kinda able to be manipulated like that. I'm not saying this is a bad move, just surprised that someone can do it.

Without going into too much detail, short answer is yes. Most people don't seem to know how far away current setup is from 'free market' touted in school. It is weird given that this information is not hidden. It is just not widely spread.

The reasons for that, both in private institutions like stock exchanges, and in terms of regulation, have mostly to do with how hideously volatile 'freer' markets tend to be, and the frequent, devastating effects banking crises, panics, etc used to have.

Re: Trading halted as U.S. stocks plummet

#359

Post by jaywalk »

phinnaeus wrote: post #332
rafiki6 wrote: post #316

Earlier quoted context omitted.

I thought these circuit breakers actually existed to stop algo's from going haywire?

Seems like that kind of thing would be implemented on the algorithm side, not the market.

You'd hope so, but why not have protection on the other end as well?

Re: Trading halted as U.S. stocks plummet

#360

Post by xenocyon »

bilekas wrote: post #180

Genuine question: They can just do that ? Issue a trading halt because they don't like the direction it's going ? > “There’s a reason why they have those circuit breakers -- it’s to give people time to come back from panicked feelings,” Seems strange that the market is kinda able to be manipulated like that. I'm not saying this is a bad move, just surprised that someone can do it.

It turns out nobody really trusts the "free market" :)
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