Q. “I’m looking for a downloadable charting platform to set up my charts when I trade… Which user-friendly charting platforms do you recommend and why?”
A. The best way to sign up to a trading charting platform, is by going directly to the platforms’ websites.
My top 3 charting platforms that I recommend and are user-friendly are…
1. Trading View (Excellent for technical, fundamental and charting analyses)
2. MetaTrader 4&5 (Connected with your broker with an easy interface to trade)
3. Velocity Trade (Simple interface which is easy to zoom, add charting lines and indicators. Great to customise the look of the charts according to your personality)
Q. “I read the other day that there was an iceberg order on Naspers, what does this mean and how do I watch out for it?”
A. To understand this term, let’s relate it to a normal iceberg.
An iceberg is a large floating mass of ice that’s accumulated in a way that it resembles a small mountain.
It takes a whole lot of ice to form an iceberg to create its magnitude.
When it comes to trading terms, it’s similar.
An iceberg is one large order that is divided into smaller orders.
Normally, a big investor or company will use an automated program, to hide their full order quantity.
The main reasons the entity would offload their shares using an iceberg order is:
• To not frighten the public which may lead to huge selling.
• To fulfill their orders in a series of batches.
• To slow down the market impact and avoid significant price fluctuations.
• To prevent front-running by other market participants.
We know public traders and investors can go into quite a panic when they see a large seller.
The iceberg order is one large order broken up into many smaller orders, to not create that panic.
This means they’ll be able to exit their large position without the price of the share dropping too fast.
The best way to watch out for an iceberg order is to do the following:
Go to the table of orders in a market on your platform (aka – depth of the market).
This is where you can see the open bids (buyers) and offers (sellers) prices throughout a certain amount of time.
If you see a repetitive quantity selling at the same price this might be due to an iceberg order.
On the bid side, you can see how the quantities and the prices are rather different without any form of pattern.
This means, the buyers and sellers are more likely to be different as you go down the depth.
However, on the offer side you can see how the quantities and the prices are very similar.
Each quantity is to offload 100 shares at a time and the price differences are a matter of cents.
This should send warning bells telling you there is probably a very big seller trying to close a big portion of his position in the market.
Stay away until the market’s quantity and prices go back to normal, and then you may continue making your trading decisions once the iceberg order has been completed.
Q. “Which website can I follow to see a list of upcoming dividend dates for JSE shares?”
A. The most reliable free website I know that updates their Dividend list almost every day is Sharenet.co.za.
Simply go to the website and scroll all the way down until you see where it says Recent Dividends, Projected Dividends and Ex Dividends.