PiNG strategies utilize daily data, therefore when there is a signal, it will be implemented on the open of the market on the following day. Signals are generated at the end of the preceding trading day providing sufficient time to plan for implementation. The goal is to get filled as close as possible to the opening price of the pertinent index for that day. Strategies will generate a Long, Short or Cash signal on a suggested market. Trades can be executed via Exchange Traded Funds (ETFs) or Futures contracts.
Our current lineup of strategies trades the following markets: S&P 500, Nasdaq 100 and the CBOE Volatility Index (VIX).
Likely the easiest way to implement a PiNG strategy is to utilize an exchange traded fund (ETF). An exchange-traded fund (ETF) is an investment fund traded on stock exchanges, much like stocks. An ETF holds assets such as stocks, commodities, or bonds and generally operates with an arbitrage mechanism designed to keep it trading close to its net asset value. An ETF combines the valuation feature of a mutual fund or unit investment trust, which can be bought or sold at the end of each trading day for its net asset value, with the tradability feature of a closed-end fund, which trades throughout the trading day at prices that may be more or less than its net asset value.
For long trades you simply purchase the suggested ETF. For example, if the strategy is designed around the S&P 500 index, you can utilize the SPDR S&P 500 ETF Trust (symbol SPY), the iShares Core S&P 500 ETF (symbol IVV) or any ETF that is designed to track the S&P 500 index.
For short trades you have a number of options. If you have the ability to "short" then you simply follow your broker's instructions on shorting securities. Continuing with our example, you would short SPY, IVV or any ETF designed to track the S&P 500. If you do not have the ability to short, then you can "inverse" ETFs such as SH (ProShares Short S&P 500) or SVXY (ProShares Short VIX Short-Term Futures ETF). Both of these ETF’s provide investors with short exposure to the index of choice. Finally, you could simply go to cash. Since stocks go up over the long-term, the long side of a trade is more important than the short side. That said, in years like 2008 or 2020, a good deal of profits came from the short trades. It’s important to note that certain strategies are designed to generate the majority of their returns from short trades. The relative value strategy is an example where it is shorting the volatility (VIX) index.
Exchange traded futures contracts provide the lowest cost and highest tax efficiency for implementing short term trading strategies. They also provide a more efficient utilization of Futures have been in existence for centuries tracing their beginning back to the 17th century. A futures contract (sometimes called futures) is a standardized legal agreement to buy or sell something at a predetermined price at a specified time in the future, between parties not known to each other. The asset transacted is usually a commodity or financial instrument and are typically transacted on a regulated exchange. In fact, the Chicago Board of Trade (CBOT) listed the first-ever standardized 'exchange traded' forward contracts in 1864, which were called futures contracts. Following our ETF example, to gain exposure to the S&P 500, you could buy or short either the E-mini S&P 500 futures or the Micro E-mini S&P 500 futures. The difference is your account size. If you are trading a smaller account, the Micro futures may be a better fit as they are one-tenth the size of the E-mini. With a futures account, implementation is simply buying or selling the pertinent index futures contract in the appropriate size for your account.
RISK DISCLOSURES
THERE IS A HIGH DEGREE OF RISK INVOLVED IN TRADING FUTURES AND EQUITIES. PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RETURNS. PING STRATEGIES, LLC AND ALL INDIVIDUALS AFFILIATE WITH THIS SITE ASSUME NO RESPONSIBILITY FOR YOUR TRADING AND INVESTMENT RESULTS. THE INDICATORS, STRATEGIES, COLUMNS, ARTICLES, LINKS AND ALL OTHER FEATURES ARE FOR EDUCATIONAL PURPOSES ONLY AND SHOULD NOT BE CONSTRUED AS INVESTMENT ADVICE. INFORMATION FOR FUTURES TRADING IS OBTAINED FROM SOURCES BELIEVED TO BE RELIABLE, BUT WE DO NOT WARRANT ITS COMPLETENESS, ACCURATENESS, OR WARRANTY AND RESULTS FROM THE USE OF THIS INFORMATION. YOUR USE OF THE FUTURES TRADING INFORMATION IS ENTIRELY AT YOUR OWN RISK AND IT IS YOUR SOLE RESPONSIBILITY TO EVALUATE THE NECESSARY COMPLETENESS, USEFULNESS, AND ACCURACY OF THE INFORMATION. YOU MUST ASSESS THE RISK OF ANY TRADE WITH YOUR BROKER AND MAKE YOUR OWN INDEPENDENT DECISIONS REGARDING AND SECURITIES MENTIONED HEREIN. AFFILIATES OF PING STRATEGIES MAY HAVE A POSITION OR EFFECT TRANSACTIONS IN THE INVESTMENTS DESCRIBED HEREIN AND/OR OTHERWISE EMPLOY TRADING STRATEGIES THAT MAY BE CONSISTENT WITH OR INCONSISTENT WITH THE PROVIDED STRATEGIES.
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