Cash Management

Market analysis is always combined with cash management which constitutes cash flow arrangement aspects, such as :

1. Trading Strategy

In principle, trading is an application of widely known portofolio theory, namely diversification of the funds invested in different stock indices which are considered to have a smaller risk. Diversification of transaction times, suh as combination of short term, medium term, and long term trading that will further diminish the risk.

2. Risk Management

By means of risk management, the risk of stock indices trading can be managed and also limited through :

Stop Loss

Limiting the risk at a certain level of stock indices

Locking

Taking a contradictory position against the original position (temporary), and than for liquidation of the locking position when it is considered safe

Average

It is used when the investor is convinced that the first open position risk and the subsequent one will be lower when the price rebounds and close to the original open position price. This technique is usually co,bined with stop loss or locking

Holding Position

This mechanism is used because investor enters in long term transaction, and it may ne combined with stop loss, locking, and average

Switch Position

The risk is reduced with the assumption that the initial position taken is apparently misdirected and then position is reversed