Buying power

buying power investment & finance definition
The amount of money that is available to fund a purchase. Often people will say that the dollar doesn't have the buying power it did many years ago.

Buying power refers to the amount of money you have available in your account to buy equities. When you buy equities your buying power goes down. When you sell equities your buying power goes up.

Buying Power Index (B.P.I.)
A composite indicator of consumer demand in specific cities, counties, and metro areas. Published annually by Sales and Marketing Management magazine, the B.P.I.

Money Management and Buying Power
Arbitrary Number of Stocks
A first money-management method would be to trade in a limited number of stocks out of an unlimited list of stocks.

Buying Power
In a margin account, the maximum dollar amount of marginable securities that the client can purchase or sell short without having to deposit additional funds.

Buying power: In a margin account, the dollar amount of securities the customer may purchase without making a cash deposit. The buying power in an account is a function of the SMA (which see).

Buying power
The amount of money available to buy securities, determined by adding the total cash held in brokerage accounts and the amount that could be spent if securities were margined to the limit.

Buying Power: The amount available for purchase of long shares.
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Cash Balance: The actual amount of cash in your account. Can be used to buy long shares, as collateral for shorted shares, or for withdrawal.
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Buying Power
Amount of credit available to a client in a brokerage account for the purchase of additional securities and is determined by the dollar amount of securities that can be margined.

When buying power is no longer enough to move prices up or when selling power is no longer enough to move prices lower.
Expiration Date
Generally the last date on which an option may be exercised.

With more buying power, you can increase your total return on investment with less cash outlay. But be careful, trading on margin magnifies your profits AND losses.
Margin Call ...

Next post: Buying Power - Overnight & Day Trading

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Option Buying Power Calculated based upon account equity less any requirements and pending purchases.

The dollar's bottom line is not against gold, but instead the buying power of a good life here within our borders. So long as the world is seeking to break into our land of opportunity, the dollar will remain a powerhouse of currency everywhere.

Margin: A margin account can have more buying power than the cash value of the account alone. A margin account is generally necessary to trade option spreads or naked option positions.

Please pay close attention to your current account information (the panel on the bottom pointed out by arrow G), it tells you your current position, your buying power and your accumulative performance so far, ...

Following the surge, which uses up a lot of buying power, the number of those buyers willing to keep buying at these high (-inflated) prices becomes exhausted.

chance that you won't get your money back); market risk (the chance that interest rates will soar, reducing the value of your dividends as well as of your bond); and inflation risk (the chance that rising price levels will erode the buying power of ...

For instance, "buying the Cal 13-12, SP-NP box spread", would be buying power at CAISO hub SP-15 versus selling power at CAISO hub NP-15 for 2013, while also doing the opposite (so, selling at SP-15 and buying at NP-15) for 2012.

Buying stocks on margin allows you to double your buying power by borrowing up to 50% of a stock's price. You borrow this from your online broker and there are of course costs associated with this doing.

Whenever the account value rose, King Midas used the extra buying power of the account to purchase more stocks, either adding to existing positions, or starting new positions.
Short-term trades: Very high turnover, but not daytrading.

Financial leverage refers to assuming additional risk in order to maximize your buying power. Options provide leverage by allowing their holders to control more shares than they can afford to buy.

The basic assumption behind sentiment models is that if a certain group is in a crowded long position, then there is little or no buying power to push the market up further.

On UpDown, if you're holding short positions, you might receive a margin call if your buying power falls below -$10,000.

If you exceed your buying power, you will generate a margin call. You will have three days to meet this call. The call will be equal to one half of the amount that you exceeded your maximum value or buying power.

Inflation is the devaluation of money's buying power and can be caused by many issues in the economy.

Trading currencies on margin lets you increase your buying power. Here's a simplified example: If you have $2,000 cash in a margin account that allows 100:1 leverage, you could purchase up to $200, ...

Annual inflation reduces your buying power. In recent years, the U.S. Government reports a 3% annual inflation rate. The business community doubles it, so that it better reflects the actual rise in living costs.

This signal indicates overbought conditions coupled with panic selling and a loss of buying power. The uptrend has reached new levels and more sellers start to show up than the bulls would prefer.

You are expected to use half of your buying power in setting both forex trades. This enables you to enter a hedge when instance 4 and 5 above occurs.
Never wait for price to cut X 1 or X 3 and use all your buying power .

A CPI that continues to trend upwards month over month could be a signal that inflation is eroding buying power to the point that the Central Bank will raise interest rates to curb spending.

TeenAnalyst Advice: Having all your money in cash for a long period of time isn't a good idea because inflation will eat away at your buying power. However, it's important to have access to some cash at all times for emergencies.

While most of the other players we are going to discuss in this lesson do not have the size and clout to move the market in their favor, many of these bank traders are an exception to this rule and can leverage their huge buying power and inside ...

The primary idea behind the use of the gold standard rested on the theory that inflation is caused by an increase of the quantity of money that is in circulation and that by fixing the price would generate certainty in future buying power, ...

Exhaustion
When buying power is no longer enough to move prices up or when selling power is no longer enough to move prices lower.

Using a lot of buying power on these transfers, the number of buyers who are willing to keep buying at such high prices becomes exhausted. They are not willing to pay anymore- the market has reached a critical point and the trend is for a reversal.

Deflation usually occurs during a recession and is characterized by supply exceeding demand, and while there is increased buying power, the amount of currency in circulation is greatly reduced.

What this means is that the amount of Rs1210 that is to be paid in two years is discounted to an amount that has the same buying power today. This amount is Rs1000. This technique is also often known as juts Present Value Technique.

Pyramid
To increase holdings that an investor has by using the most buying power available in a margin account with paper and real profits.

Inflation refers to the fact that a given amount of currency will have a decrease in its buying power in the future. A given amount of money will buy less quantity of goods in the future than it will today.

Support : A price, or price zone beneath the current market line where buying power is sufficient to halt a price decline.

There are fresh longs ready to speculate, and short-sellers who don't realize they're trapped. These two forces combine to generate tremendous buying power that can trigger explosive moves.

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Inflation: Economic condition where consumer goods price increases, limiting buying power.
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What often happens is that if the interest rate increases by only half a percent per year, the actual buying power of your $10,000 at the end of 5 years may actually be only about $7,500 or so.

In an uptrend three long black days occur that open at the previous day's close. This pattern is similar to the Three Black Crows pattern but typifies a more severe loss of buying power. A bearish trend is almost certain.

But even under these circumstances, you run the risk that inflation will erode the buying power of that money over time. While buying stocks entails greater risk, the potential rewards are greater too.

It allows traders to open positions on amounts that greatly exceed their account limits and so increase their buying power. Swissquote Bank offers a 1% margin (or 1:100 leverage), which means you can control 100 times your deposit in the real market.

At the same time, the NFP numbers can also measure whether inflation is on the rise or not in the economy. A rise of inflation would obviously be of interest to traders since it would mean that the national currency has less buying power and would ...

in response to a number of factors-changes in supply and demand for credit, fiscal policy, exchange rates, economic conditions, and crucial for the bond market, changes in expectations of inflation. High inflation reduces the future buying power of ...

of the latest reported short interest positions for the month divided by the daily average trading volume. A high ratio is considered bullish while a low ratio is considered bearish. A ratio of 2 is considered 2 days potential buying power.

To learn about the I bond purchase limits and how to maximize your total buying power, take a few moments to read this overview. What is the maximum amount of Series I savings bonds I can buy each year? ...

Although deflation seems to increase your buying power in its early stages, it is generally considered a negative economic trend. That's because it is typically accompanied by rising unemployment, falling production, and limited investment.

The theory is that when a significant number of participants are bullish, they are already positioned on the long side and there is little potential buying power left.

These two sharp advances with relatively heavy volume have exhausted the buying power in the stock. Without that power behind it, the instrument reverses its upward movement and falls into a downward trend.

They also ignore the subtle deterioration in the quality of spending choices due to the shift of buying power from people who have demonstrated a superior ability to invest or produce (creditors) to those who have demonstrated primarily a superior ...

cash in a margin account that allows 1:100 leverage, you could purchase up to $200,000 worth of currency because you only have to post 1% of the purchase amount as collateral. Another way of saying this is that you have $200,000 in buying power.

buying power The value of money, as measured by the quantity and quality of products and... buyout The purchase of controlling interest in one corporation by another corporation, in order to take over assets and/or operations.

[OTS] buying power money and other liquid assets, plus credit, that is available for spending and consumption of goods and services.

See also: Market, Trading, Stock, Investment, Long