Investing Questions and Answers

How does one invest surrounded by VIX futures? Is that a commodity?

Can you do that on Scottrade?

Answers: Scottrade doesn't allow their customers to trade VIX options; The root they gave me is because they expire contained by the middle of the week. Interactive Broker will allow you to trade in VIX option however.

VIX is a commodity, that's right, like pork bellies or corn or soybeans. VIX is the switch ingredient in Taco Bell burritos. VIX grows high-ranking up in the Andean mountains and is remarkably rare, but yummy. Stock up on VIX if you think Americans will be buying more burritos.

The previous answer describes what the VIX is.
But here is a way to invest within it; through the options flea market (buying or selling puts or calls). However, this is a risky investment, unless you really know what you are doing.
Given that you hadd to ask "what" it was, I would not recommend it. Even seasoned investors stay away. It is really for "traders" who enjoy immediate access to the market.

VIX is the ticker symbol for the Chicago Board Options Exchange Volatility Index.

I honestly think I would be doing you a disservice to afford you advice around how to get into the brand of advanced trading that you are talking just about. One really has to own a great deal of ease and confidence about what they are doing to even work the commodities marketplace much less dealing within futures. Please consider starting out with safer and much more traditional index funds or ETFs. In the meantime, you can study these other more advanced areas and opt if they are right for you. Good luck.

The CBOE offers futures contracts on the VIX. You'd entail a futures account to trade them.

The futures trade at a premium to the bread VIX index you're familiar next to and that premium decreases over time until the adjectives and the VIX are at nearly the same price at futures expiration.

Go to CBOE.com for more info in the order of the VIX and VIX futures.

How many times are you going to ask this?

What is a "hedge fund"?

Answers: Investing is a speculation play to accumulate wealth and some are allowed and privilidged to be better at it than others. Depends on the money you have available and the tools in your box to fix the markets the way you like em, in other words what advantages you have to start with before the race to accumulate wealth starts. Hedge Funds can do both as they have the saavy and the accumulation of wealth from richer investors to work with. The bigger and saavier they are, the more they make.

Hedge funds, as I understand it, maneuver like a really good stock trader would with more funds from their investors, taking calculated chances with options which are time decaying bets that have high rewards if you are right and high losses if you are wrong. The options are one major profitable way of hedging your bets when you buy an investment opportunity.

Sometimes an investment gains in value(that's what you wanted in for in the first place if all you did was buy and sell securities or stocks) and sometimes it goes down in value(a loss).

So if your investment value decreases on a security or share value, in order to protect value, you place insurance bets that it would go down to a certain level, puts, (your account has to have more money in it to do this), and so when it starts to lose value and goes past your set limit, you are allowed to both (collect on your bet that that security(stock) value would go down, (this would be your hedge bet winnings)) and you would be able to cut your losses, automatically selling your stock before or after it dropped further in value beyond your designated "strike price" in time before the time decay ran out.

Often, Hedge funds forego purchasing of any securties and opt instead to purchase only options and collect on them. They are not like index funds that are forced by law to buy a wide range of indexed stocks.

It is easier for a Hedge Fund to manipulate prices of a security if they own large chunks or collaborate with other large chunk owners raising and lowering the price of the security while attracting and repelling potential small time investors, (who are not so manipulative and hence not so successful most of the time, except in a predictable bouncing market), making profits off privilidged news by selling and buying their securities, semantisizing and exagerrating financial news to build anxiety or fear into other investors to manipulate the market to the hedge fund's advantage .to make money off the options mostly.

Hedgers are the people you see smiling and joking when the stock market goes down or up! They are making money hand over fist either way as long as their timed bets are correct. After all, they are playing a major roll in the manipulation of the market(s) they are invested in! They are large and they have the cards. They are "The House" if you will, especially in the indexes and large caps, but in many cases small caps too.

Options profits can be had from calls too, bets that a price of a security will go up in a period of time. That gives them the right to buy the security at a strike price even though the security has gained in value beyond the strike price!

Options pay a huge premium if you are right. Hedge funds, through their larger ownership of underlying securities and options plays manipulate securities. They don't want small potatoes for investments, because it is too much trouble and does not add much to their pool of useable funds to do their manipulations.

Hedge Funds hedge using other methods of trading as well including "shorting a stock", which gives them the ability to leverage a stock price while it is dropping and pick a time to get in if they think it is about to drop, like a put but with no decay probems. They like to fully buy when the stock hits the bottom. This is a leverage play.

Like a really sharp trader, Hedge Funds use a variety of their tricks and attempt to make the most money for their investment and pay their shareholders a small piece of the pie and keep a lot of money for themselves, CEOs, CFO's and what not for their concentrated efforts. These traders are kind of like machine language programmers of the stock market! Very fine tuned and calculating individuals. And so many people feel they deserve the rewards they get. Many investment firms are hedge funds but are not categorized as such or have branches of their outfits that do such.

A recent development that has made hedge funds a lot of money and that is called the subprime mortgage crisis. You might have heard about it as it has affected stock markets around the world? An average amateur stock trader is at quite a disadvantage in this kind of market, especially if they are a long term trader. The entire market, entire indexes .have lost a lot of value. But Hedge Funds made money if they made the right bets. Goldman Sachs had a division that kept them from losing in the billions by hedging subprime correctly.

Hedge Funds are giant modern day "money changers". We only hope they really have all of our best interests at heart!

A hedge fund is a private investment fund that charges a performance fee and is typically open to only a limited range of qualified investors.

Hedge fund activity in the public securities markets has grown substantially as it constitutes approximately 30% of all U.S. fixed-income security transactions, 55% of U.S. activity in derivatives with investment-grade ratings, 55% of the trading volume for emerging-market bonds, as well as 30% of equity trades.

Hedge Funds dominate certain specialty markets such as trading in derivatives with high-yield ratings, and distressed debt.[

an financial institution carrying business with hedging funds.- with apatite of high risk with expectation of higher return. they operate in cross market/countries. they enjoy tax benefits from tax heaven countries. they employ high profile professional in fund managements.

they borrow huge money from HNI (high net worth investor) Pension funds, etc., who have high apatite for higher risks in relation with promise of high risk).

functioning of hedge fund and its strategy is a different story, which you've not asked....!

Here is an article on the Top 10 Hedge Fund Myths - what hedge funds are not: http://richard-wilson.blogspot.com/2008/...

Here is an article on hedge fund industry basics: http://richard-wilson.blogspot.com/2007/...

Here is an article on the differences between hedge funds and mutual funds: http://richard-wilson.blogspot.com/2007/...

I hope this helps. If you have more questions you can reach me at Richard(a)RichardCWilson.com or download my free hedge fund book online at http://hedgefundsbook.com

Cheers

- Richard

When Tisco change its name as TATASTEEL in stock exachange ??

Answers: please see the yahoo finance - you will get instant answers for all these questions.

ok It changed its name on 12th Aug 2005.

Ref: Hindu...Business Line Sat Aug 13, 2005

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