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Oil Traders Misread Tweet, Oil Prices Spike
cartechboy writes "Ahh Twitter. Sometimes when you combine lightning fast information distribution and humans, minor (or not-so-minor) chaos can ensue. Yesterday, the Israeli military tweeted a commemoration of the 40th anniversary of the Yom Kippur war, which took place in 1973. But the tweet referenced the bombing of Syrian airports by Soviets, and oil traders, already an antsy group, assumed the tweet referred to an attack occurring that very moment. As you can imagine, this had some impact. Within an hour, the global price of oil jumped more than $1, from $110.40 to $111.50 as trading volumes soared. In the end, the traders missed a few things that would identify the tweet as historical vs imminent: Yom Kippur was weeks ago, the Soviet Union is no more, and most important, #checkthehashtag."
Anyone getting their investment advice from Twitter deserves what they get.
"I just wish I could get in on more of these mis-pricings on time,"
That would make you a twitchy day-trader.
lightning: electrical discharges in the atmosphere.
lightening: what happens just before dawn.
Sacred cows make the best burgers.
Within an hour, it had jumped more than $1, from $110.40 to $111.50.
it jumped 1%. that's hardly significant. in fact, that's just pretty regular. this is a stupid article. who the hell approves this crap?
I think you're confusing the following:
1. Investors - which is most of everything
2. Traders - people and their agents who trade
3. Robot programs which trade based on twitter and facebook and newsfeed key words
4. Derivatives - which is a fancy word for Legalized Gambling
While they can overlap, they are not the exact same groups. Most investors know that active management is more risky and tends to be less profitable to actual investors than index trading, precisely for that reason.
-- Tigger warning: This post may contain tiggers! --
I believe the actual term for someone who uses Twitter rumors for stock trading is "twit".
The stock market always goes up in the long term.
Oh yes.
Even if it drops for a year it'll be fine. I won't be taking money out until I retire, and that won't be for at least another 25 years... it's best to not pay attention, in my opinion.
That's a little simplistic. I know many folks who were just about wiped out, right around the time they retired. Yes, the market always goes up. And that is an awesome investment strategy if you are going to live for 200 years. For us mere mortals, where it's at when we retire - or move it into less volatile investments is much more important.
If you plan on moving your investments into something more conservative at some point, where is the market going to be at that point? I know one fellow who hung on a bit too long, and was bit hard twice.
I lucked out and went conservative pretty early on - way too early for most. I was an imbecile for about a decade. Sad to say, my smart colleagues who knew the market only went up in the long run are now planning on working into their 70's. Hopefully they will be allowed to do that. Me, I retired on my terms at 56.
Invest well, save well, live well, but well below what the economic forces tell you to.(real estate people, investment people, banking people) Pay attention to your stocks. Constant monitoring is only a problem if you get greedy, and too many people cannot not be greedy. The vampires and leeches feed on that greed, and do a slam bang job of extracting your wealth.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
I'm not sure where this came from. Speaking as an oil trader, the spike was entirely the result of Boehner's speech offering a temporary debt increase. I do have several twitter feeds open to guage news sentiment, but the IDF's isnt one of them. Did the Israelis find a ton of oil i was otherwise unaware of?