Its incredible how some foreign indexes follow the US stock market trend, for example the Emerging Markets Index has the same pivot points as the S&P 500.
But, can the previous day in overseas stock markets, that traded when Wall Street was closes, provide some clues of the next day in the US?
2007-01-30 03:50:31 · 6 answers · asked by Carlos G 3 in Business & Finance ➔ Investing
Sure. I would say there is some correlation there.But that correlation may be related to a simple up or down trend, not a total return or dollar weighted return. I would also suspect that if there is say a big move up in Europe, and you tried to buy at the opening bell, your order might not get processed a the opening US price. So on paper US Index ABC went from 1000 to 1080, looking like easy money, but if the opening sale price is 1080 then you would have only made money if you had bought the index the day before. And of course you did not know the Euro markets would be up.
2007-02-03 21:44:36 · answer #1 · answered by Gatsby216 7 · 0⤊ 0⤋
Sure overseas markets can provide initial clues to Wall Street opening. However, be wary of so called trends because nothing is 100%. Stocks are nothing more than legalized gambling - by the way I love it. With gambling comes risks so be wary of betting on U.S. stocks based on what the overseas market did or did not do on the previous day. One once said that a monkey throwing darts could pick out 3 winner stocks just as accurately as the best stock brokers.
2007-02-06 13:06:14 · answer #2 · answered by Mike 2 · 0⤊ 0⤋
yes and no. Generally, it is the other way around - US markets lead foreign markets. There was a whole group of investors called market timers who played off this relationship. Unfortunately, they started doing illegal things like waiting for earnings reports (which come out after the market is closed).
I don't know if they still allow it, but a lot of mutual funds used to legally allow you to market time. What you do is this. If the US market is up a lot, put an order in to switch from you US fund to a Japanese fund. Your US fund will get the closing price for that day, but you will enter your Japanese trade at the PRIOR close. They will open up and you will make the money...then reverse it...do it too much and you will get a letter telling you to stop it - but that is not illegal.
2007-02-06 08:45:36 · answer #3 · answered by Monument 2 · 0⤊ 0⤋
I think it only works one way ...( your opening sentence)
I know I've got a lot in foreign mkts and I'll occasionally be up at 3-4 A.M. and turn on CNBC , see what the Asian mkts did...and what the European mkts are doing....then go to bed.....when I get up, look again ..Wall Street is doing something completely different half the time or following right along the other. Oil up all night ,down today? Foreign markets down...but my foreign stocks up on NYSE ?
Yeah! I think it's only "one way" and that's not a sure thing either.
If you find a " pattern"...POST IT!
2007-01-30 13:09:11 · answer #4 · answered by jebediabartlett 6 · 0⤊ 0⤋
Yes sometimes but don't base any stock transactions on it
2007-02-05 18:52:47 · answer #5 · answered by ? 6 · 0⤊ 0⤋
No.
2007-01-30 05:06:43 · answer #6 · answered by Anonymous · 0⤊ 1⤋