Finance: What is position trading?

What are position trading and swing trading? Get your mind out of the gutter. They're way more boring than they sound.

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Transcript

00:29

a long term trend that is big and fat and wide and can last decades like the [S&P 500 graph appears]

00:34

advent of the internet a given market like a bear or a bull last a few years

00:39

and change and things that are intermediate term like a few months to

00:44

maybe a year are where position trading comes in like a prognosticator might [Knights carrying Ned Stark]

00:49

give convincing data to a hedge fund that this winter will be much colder in

00:54

high population areas than was previously predicted so he wants to

01:00

short gas futures exposed to those areas and from the next six months that would

01:05

be a position trade short gas.. kind of like gas X only different...So [Woman letting off gas]

01:12

that's position trading where you're thinking about a couple of quarters in

01:15

the future for a given investment and if you think about the original position we

01:19

proffered if the players involved are good well it can last for an hour maybe [Man exiting a restroom]

01:24

more now put yourself on a swing set well one swing from peak to trough lasts

01:29

only seconds but that's swing trading position trading lasts months whereas

01:35

swing trading lasts days..There's a shock from a bomb having gone off in the [Explosion occurs]

01:40

middle east and for three days oil prices spiked with the world holding its

01:45

breath thinking that this is the beginning of the end and that more bombs

01:49

a'la Dr. Strangelove will come in other areas but then the swing trader might [Dr Strangelove on a rocket]

01:54

make a bet that this bomb was an isolated incident a one-off or that in

01:58

fact the headline was misspelled courtesy of the poorly schooled

02:02

journalist who wrote it and instead it was supposed to be this headline so in

02:07

those three days oil prices fall back to about where they were and the swing [Oil prices decrease]

02:11

cycle is complete in our next video

02:14

maybe we'll get into a different kind of swing...[Do not disturb sign appears on door]