After the first three trading sessions this week, our assumption about the higher risks of global stock market indices declining can be seen as justified. At the same time, there is still no need to speak of a dramatic correction, so equity markets will only face accelerated movements in one direction or another. Thus, the period when it is “better to be without a position” is about to become a period of “now risk taking is justified”.
For the Ukrainian stock market, despite a seemingly strong downward movement, the situation is similar. Moreover, if we remember that the potential success of a position depends on two parameters – the probability of movements and their magnitude – then we reach what is, in some ways, the surprising conclusion that opening short positions at current levels is still more risky than opening long ones.
However, this assumption of a relatively higher risk may be offset if the UX Index drops below the 1,300-point mark. While the index is still above the mark, long positions from the 1,300-point mark (specifically from this mark, +/- 10 points) seem to be more logical. Since we are talking about short-term positions, this means that the risk investors assume upon opening this position should not exceed 10-20 points.
