TradeWize · Blog
Investing, explained in plain English.
Everything you need to understand investing and keep up with the markets.
What Is Short Selling? How to Bet on a Stock Falling
You sell shares you don't own, then buy them back later. The awkward part is who lent them to you — and that they can ask for them back at any time.
Read the article →What Is the Yield Curve? Normal, Flat and Inverted Explained
It's one line on one chart, and when it tips over people start saying the word recession. Here's what it plots, and what fifty years of it are actually worth.
Read the article →What Is a Covered Call? How It Works, With a Worked Example
You already own the shares. Someone will pay you a fee for the right to buy them off you at a price you choose. Here's what that costs when the stock runs.
Read the article →Why Price Spikes Through Your Stop, Then Reverses
You bought well, put the stop where the book said, and got taken out within a nickel of the low. The explanation isn't that somebody came for you. It's less flattering than that: you were predictable.
Read the article →Inflation Quietly Raises Your Tax Bill — And Nobody Has to Vote For It
Nobody announced it. Nobody campaigned on it. But when prices rise, so does the government's take — twice over, and out of the same pocket as everything else.
Read the article →Vertical Spreads: Why You'd Cap Your Own Upside on Purpose
Buying an option and selling another one against it sounds like undoing your own trade. It isn't — but what you get in return is smaller than the sales pitch, and there's one number that says how much smaller.
Read the article →What Is a Rights Issue? When the Company Asks You for More Money
A letter arrives. The company you part-own would like more money, there's a deadline, and the discount it's waving at you is not the gift it looks like.
Read the article →What Are Bollinger Bands? What They Measure, and What They Don't
Price touches the upper band and half the internet calls it a sell signal. The man who invented the bands spent a numbered rule saying it isn't one. Here's what the lines actually measure.
Read the article →What Is a Pivot Point? The Level You Don't Have to Draw
Every other level on a chart is somebody's opinion. A pivot point is a division sum — yesterday's high, low and close over three — and everyone who runs it gets the identical number. That sameness is the whole case for the tool, and the whole case against it.
Read the article →Break of Structure: When a Trend Continues, and When It Quietly Ends
Price closes past the last peak and the internet calls it a break of structure. The hard part isn't spotting it — it's that the candle which ends a trend and the candle which means nothing look identical until the close.
Read the article →The Options Greeks, Explained: What They Are and How They Work
Four numbers that explain why your call can lose money on a day the stock goes up — and why the one everybody watches is not the one that usually does the damage.
Read the article →Candlestick Patterns: Which Ones Actually Work?
Traders have named these shapes for two and a half centuries, and somewhere along the way naming them started to feel like predicting them. It isn't. Here is what the evidence says, including the awkward bit about the pattern everybody knows.
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