c09 JWBT016-Busby September 30, 2008 14:11 Printer: TBD
CHAPTER 9 Dancing with the Dax
F
or almost a decade, I have enjoyed dancing with the Dax. The Dax 30
is a powerful German equity index that is comprised of 30 blue-chip
German stocks. The shares are traded on the Frankfurt exchange.
I trade the futures index and it trades on the Eurex Exchange. My love
affair with the Dax began on September 11, 2001, when our financial mar-
kets and our nation suffered a brief but major hit. Shortly after the two
hijacked jetliners flew into the Twin Towers, U.S. exchanges, including the
New York Stock Exchange (NYSE) and the Chicago Mercantile Exchange
(CME), shut down and stayed closed for a week. On that fateful Tuesday,
I was teaching a class at my trading school in Mobile, Alabama. My stu-
dents and I were long the S&P 500 futures. I was not watching the news; I
was trading and teaching, but I knew from the behavior of the market that
something had happened to spook them. Prices began falling quickly and
were reacting in a manner that was not typical for the time of day. My stu-
dents and I had already taken profits from our trade and had a protective
stop in place on the remainder of our original position. Our stop was hit as
prices headed south, and we were removed from the market.
Realizing that prices were reacting as if some news event had occurred,
I asked Geof Smith, our chief instructor, to do a little investigation and re-
port back to us. Geof stepped out of the room and turned on a television in
a nearby office. Then he walked back into the room and reported the unbe-
lievable news. We turned on the television in the classroom and watched
as further tragic events unfolded. Like the rest of America and much of the
world, my students and I were stunned and saddened by the life-changing
events that occurred that day.