By Wordwide FX Financial Translations
This morning, as I usually do, I was listening to my favorite radio broadcast, and the conductor asked a question to the audience: “Do you celebrate Halloween or All Saints Day?” Well, you have to be aware that we are in Spain, a Catholic country, and that Halloween is an adopted foreign tradition here, same as Santa Clause or Valentine’s Day – hence the question. The audience called and had a say in the matter, but what neither the conductor or the audience seemed to know is that “Halloween” and “All Saints Day” mean almost the same. The word Halloween or Hallowe’en comes from All Hallows Eve, which means “hallowed –holy– evening”, that is to say, “the evening before All Hallows Day or All Saints Day. All around the Christian world, it is a time dedicated to remembering the dead, including saints (hallows), martyrs, and departed loved ones. In any case, in modern Anglo-Saxon countries All Hallows Eve is a scary night where scary movies are played on TV and children go “trick or treat” their scared neighbors.
Needless to say, the financial markets also participate of this tradition in a number of ways, thanks to the magical intervention of Witches, Zombies, and Ghosts. Investopedia explains that the last hour of stock trading between 3 pm and 4 pm EST is called “the Witching Hour” and is typically controlled by professional traders. And if you combine these dark hours with the magical number “3” you’ll get the “Triple Witching”, which is the third Friday of every quarter, when options and index futures expire and roll to the next series.
Ghosts and Phantoms are also found in the financial markets. A Phantom Stock (or Shadow Stock) Plan is a benefit plan that gives senior management employees many of the benefits of stock ownership without actually giving them any company stock. Even darker is the practice of “ghosting”, an illegal practice whereby two or more market makers attempts to influence and change the price of a stock. Sometimes it’s not ghosts who try to influence financial practices, but Voodoo practitioners, masters at employing various accounting gimmicks to artificially boost the bottom line by inflating revenue or concealing expenses.
As you see, the markets can be also scary at this time of the year, and it can get even more so when zombies appear! Zombies are companies that continue to operate even thought they are insolvent or near bankruptcy. Because a zombie’s life expectancy tends to be highly unpredictable, zombie stocks are extremely risky,
Happy All Hallows Eve and All Hallows Day to everyone!