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Traders Have an Advantage In the Market Right Now

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48

The broader market has seen elevated levels of volatility in recent weeks as fears of an economic slowdown and an eventual recession loom large over investors. TheStreet’s Martin Baccardax explains how the recent uncertainty in the stock market is pushing traditional investors out, while luring traders in. “Essentially what we're seeing now are such elevated levels of daily movements that it entices investors out of the marketplace and traders in. You've often heard the term that markets hate indecision, if you will. They prefer certainty. And I think from an investment point, markets absolutely prefer certainty. But from a trading point, people make hay out of uncertainty” says Baccardax.

Full Video Transcript Below:

MARTIN BACCARDAX: For my money, J.D., at the moment, I think market volatility is a bigger issue than capitulation because essentially what we're seeing now are such elevated levels of daily movements that it entices investors out of the marketplace and traders in. You've often heard the term that markets hate indecision, if you will. They prefer certainty. And I think from an investment point, markets absolutely prefer certainty. But from a trading point, people make hay out of uncertainty. And that's certainly what we're seeing now with elevated levels to the VIX, the daily swings that we're seeing in markets, and the fact that we can get sustained rallies of about more than 100 points or the S&P 500 over multiple days, even when there are so many headwinds that are facing us at this time.

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