Greece, China, and Equity Market Pairing

Earlier this week US markets experienced one of the most volatile trading days from top to bottom since October 2011, despite seeing a lot of financially seismic events since then.

In terms of Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term moving forward, I have been trading a number of exchange-traded funds (ETFs) based on market movement. Lets take a more detailed look at what exactly transpired earlier this week.

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Given my penchant for making plays in the market after 10:30 EST, we see that the market tried to bounce around 10:30 EST, eventually succeeding at 11:30 EST. Ultimately however, this is not a one-position market, rather this is a market where groups are moving, a move reflective in a number of instances, notwithstanding Chinese internet stocks.

Doom and Gloom

Chinese stocks received a beating earlier this week, following a number of disparaging signs of a bubble that many market participants felt was the worst kept secret in financial markets. After incurring a drop of nearly -32% off of its highs in the middle of June, the Shanghai Index has found itself facing a number of headwinds.

In addition, markets also grappled the lingering situation in Greece that came to a head yesterday with a concrete ultimatum of a "final" deadline between Eurogroup creditors and the Greek government.