In summary, learn what can happen when a crowded trade is forced to unwind or when the music stops abruptly.
In fact, the crowded trade in November and December was that retail for the holidays was going to be above expectations.
When too many people are performing the same analysis and arrive at the same conclusion, however, it becomes the crowded trade.
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As a result, this has become a VERY crowded trade in hedgieland.
And the more crowded the trade is, the greater the potential for stress.
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Gold looks ready to bust through highs, but the trade is getting crowded so we will take some profits while holding some for the breakout.
Technical analysis is powerful because charts are a reflection of emotions, and the gold trade has become crowded with irrational retail investors who buy into the hype at exactly the wrong time.
Instead, traders around the world will be able to buy and sell futures contracts on any of these exchanges via a single computer link, without anyone signalling a trade across the crowded floor of a futures pit.
However, the short trade is far from crowded, as only 2.35% of AAPL's float is sold short.
As Loeb and other high profile investors reveal their winnings, and as spreads have narrowed relative to German bunds, the trade can become increasingly crowded.
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The calendar is crowded next week with economic reports, starting with international-trade data on Tuesday, followed by retail-sales data on Wednesday.
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The problem, however, is that these trades have already become crowded, as they have been popular for too long among carry trade investors.
Carry trade bets throughout various asset classes have become overextended and super crowded.
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We could go on and on about 13-inch Ultrabooks, but as we continue further down the list, we'll start mentioning more trade-offs, from cheap build quality ( Acer Aspire S3) to crowded keyboards ( Toshiba Portege Z935).
The definition of a crowded trading space, says Chincarini, is when multiple market participants begin to follow the same trade, altering the risk and return dynamics of the trade.
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