7 replies to this topic

[A-ha]

when do they usually send out margin calls... tomorrow will be the 5th trading days. from my recollection, 7 days or so but maybe changed .

Edited by xD&Cox, 04 March 2007 - 01:41 PM.

[bliss just missed]

when do they usually send out margin calls... tomorrow will be the 5th trading days. from my recollection, 7 days or so but maybe changed .

According to NASD, 5 business (trading) days.

[Rogerdodger]

The amount of margin debt hit a record 285 billion on January on the New York Stock Exchange. The last time margin debt hit this level was at the height of the dot-com boom in March 2000 ~ just ahead of a two year decline in stock prices.

Traditionally, this is viewed as a sentiment indicator reflecting extreme bullishness. The interpretation is bearish and contrarian.

Edited by Rogerdodger, 04 March 2007 - 02:38 PM.

[flyers&divers]

I have a hunch that it is not the condition of the public but overwhelmingly the condition of the loose-cannon hedge funds will count into how deep and fast we go. Of course there is a loop and being scared into not buying and redemptions by the public plays into this too. Would anyone have information as to what percentage of hedge fund assets are private investor vs institutional? Thanks in advance, F&D

[hiker]

hi f&d-

hedge fund info -

http://www.hedgefund...e.com/index.php

[imhotep]

The amount of margin debt hit a record 285 billion on January on the New York Stock Exchange. The last time margin debt hit this level was at the height of the dot-com boom in March 2000 ~ just ahead of a two year decline in stock prices.

Traditionally, this is viewed as a sentiment indicator reflecting extreme bullishness. The interpretation is bearish and contrarian.

Roger - Your post alludes to the fact that "all the margin debt", is on the long side. Margin Debt, when given, is a "collective margin debt", is that not so? Meaning of course, that "collective margin debt", is a figure that includes both "long" and "short' margin debt. Please correct me, if I am wrong. If it is indeed a "combination" of both long and short, I would not get too excited about it.

[flyers&divers]

hiker, thanks for the link, F&D

[Rogerdodger]

The amount of margin debt hit a record 285 billion on January on the New York Stock Exchange. The last time margin debt hit this level was at the height of the dot-com boom in March 2000 ~ just ahead of a two year decline in stock prices.

Traditionally, this is viewed as a sentiment indicator reflecting extreme bullishness. The interpretation is bearish and contrarian.

Roger - Your post alludes to the fact that "all the margin debt", is on the long side. Margin Debt, when given, is a "collective margin debt", is that not so? Meaning of course, that "collective margin debt", is a figure that includes both "long" and "short' margin debt. Please correct me, if I am wrong. If it is indeed a "combination" of both long and short, I would not get too excited about it.

You may have a valid point. And I hear some debate both ways.
One blog:

The WSJ noted For the monthly period ending Feb. 15, the number of short-selling positions not yet closed out at NYSE -- so-called short interest -- declined 0.9% to 9,595,242,421 shares from 9,680,953,526 shares in mid-January.
The hidden lining, even in a doomsday and bearish case, is that the low VIX also translates to very low options prices on a historical basis. In short, you can hedge many of your positions with options to lock-in gains or to protect against major losses.
...So you can be cautious and bearish for what will be a very low historical cost in options; OR you can point to the WHY's about the margin levels being at a record and about the fear index showing almost no fear at all about market prices.