Which one of the following four trading styles is she likely to use?

A trader attempts to hold long positions when markets are rising and hold short positions when markets are falling.

Which one of the following four trading styles is she likely to use?
A . Technical trading
B . Contrarian trading
C . Black box trading
D . Market timing trading

View Answer

Answer: D

Explanation:

Market timing trading involves making buy or sell decisions of financial assets by attempting to predict future market price movements.

This strategy:

Long positions when markets are rising: The trader buys securities expecting their prices to increase.

Short positions when markets are falling: The trader sells securities expecting their prices to decrease.

This behavior aligns with market timing, which is an active trading strategy based on the anticipated direction of market prices.

References Source: How Finance Works?