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Election Considerations
Barrack Obama has been elected President and we have elected a new leader and, in turn, a new administration that's responsible for leading us out of the economic, banking and housing crises while fixing, furthering or finally implementing the projects that will not only set our country's future direction, but power it as well.
Speaking of power – specifically, alternate forms of it – we believe development of a comprehensive energy policy will be a major new course of action for America during the next four years.
Clearly renewable, clean energy will be an important part of our new energy policy. And so will oil and gas drilling.
In our stock market today, some sectors have yet to be fully sold and others have been oversold. In our view, many of the oil service stocks have been oversold and are trading at single-digit multiples. Unlike the exploration and production companies, oil service companies generally do not need lots of new capital to conduct their business.
Another new reality is, with the transfer of huge amounts of debt from the private sector to the public sector, the U.S. government will be very much restricted in its ability to maintain its military presence abroad. Funding for Iraq and other military ventures is likely to be reduced; in fact, a reduction of troops has started already.
Just as the Great Depression shaped a generation of Americans' views about risk, spending, savings and debt, this yet-to-be-named financial crisis/crash will forever change how investors view risk and how our government views unbridled free market forces.
From the investor's point of view, risk needs to translate into reward.
So if volatility equals risk, and if volatility is going to be higher on average over the coming decade (which we strongly believe will be the case for a multitude of structural reasons), then the stock market rewards must be higher than they have been historically or else money will flow to places where the risk/reward relationship is more in balance.
During the past two months, more than $70 billion came out of U.S. equity mutual funds. From the government's perspective, it will clearly have to regulate the financial markets more deeply and begin the process of working the taxpayer out of the current $3 trillion bailout hole.
We will have to wait and see whether the events of the past year finally are sufficient to cause our legislators to become fiscally responsible with the budget.
Dear OptionsZone Insider Reader,
The election is over. But there is still a lot of uncertainty and volatility in the markets that makes for a great trading environment.
You want to be ready to profit in this brave new world with the right tools and information to make consistent and profitable trades.
thinkorswim has always had an ambitious goal - to transform the way self-directed investors trade stocks, options, mutual funds, futures and forex.
Thanks to unprecedented client-side technology and the delivery of practical investor education by industry veterans, the plan has worked.
Want speed, features and fun? thinkorswim’s flagship trading platform sets the bar for the industry. An easy-to-use interface combined with powerful trading tools, the TOS software is built for all levels of trading, from beginners to seasoned pros. There’s even a version with training wheels, paperMoney, that lets you practice before you trade for real…Click here to get your free trading software download.
Check this out . . .
- NEW — Live, streaming video! thinkorswim is excited to offer exclusive access to CNBC Plus directly within thinkDesktop. It’s instant replay for the financial markets - except better.
- Forex (FX) currency trading is now available on thinkDesktop!
- A state-of-the-art system for monitoring, analyzing and trading equities and option derivatives - efficient, feature-packed and powerful.
- Java-based, browser-less application checks every time you log into it for any software updates and then updates itself.
- thinkDesktop can be run using either “real” or “paper” (fake) money. In the paperMoney mode every user has two virtual accounts each funded with $100,000 of “play money”. Enjoy all of the same features except that the trades aren’t real and you can start over anytime you like, what could be better?
- Scan Tab to let you search for stocks based on fundamentals, personal and/or sector watch lists, top tens and implied volatility. Coming next month we’ll be adding chart recognition scans, option activity and historical implied volatility.
- Powerful analytics, streaming quotes, two charting packages, we could go on and on.
And, thinkorswim is rated highest software-based online broker and “best for options traders” in Barron’s 3 years straight.
An easy-to-use interface combined with powerful trading tools, the thinkorswim software is built for all levels of trading, from beginners to seasoned pros. Click here to download your free trading software download.
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