The 10 Best Random Trading Strategies

SAN FRANCISCO (MarketWatch) — S&P downgrade. Risk off. Hurricane Irene. Risk on. Obama’s next speech. Risk off. German court ruling. Risk on. Italian austerity? You’ve got to be kidding.

The markets are moving so fast these days that fundamentals are out the window and meaningless grasping at headlines is the only hope for investors to avoid the coming global economic train wreck. Which makes it a great time to be in the headline business. Unless you have to rank them. 

[7]. A paralyzed President faces a hostile nation with nothing more than a warmed-over stimulus plan and an oratorical insistency that has long since triggered the automatic mute button. Risk on. Dow industrials average rises 276 points. 

[2]. A well-baked Lothario thumbs his nose at Europe while playing politics with an austerity plan that’s the only hope of dragging Italy out of a widening chasm dubbed Lehman 2. Risk off. Markets plunge. A week later, the Italian parliament passes said plan with almost no teeth in it whatsoever. Risk on. There will be another one soon enough. 

[10]. A revered central bank turns its back on global markets and institutes a rigid currency floor against the euro in a desperate attempt to save itself from being dragged into recession by the popularity of its currency, the Swiss franc. Risk off. Nobody likes a currency war. 

[5]. Comment on Swiss National Bank move from Maurice Pomery, chief executive of Strategic Alpha, speaking to the Financial Times. “After currency wars come trade wars, and as we see the exporting world pressured, as the developed world contracts, tensions will rise.” Risk off. Great Depression redux, anyone? 

[8]. Gold falls $50. Risk on. Forget precious metals or the Swiss franc. The Norwegian krone is the new global safe haven. The downside is they only come in coins, and you have to take delivery. 

[3]. The markets are so bad, and Fed chief Ben Bernanke so unwilling to flood the financial industry with a third round of bond-buying, that investors are looking to emerging markets, such as Brazil, for badly needed liquidity to keep them afloat. Everybody now in unison with Roy Scheider: “I think we’re gonna need a bigger boat.” See MarketWatch story on hopes for emerging markets rate cuts. Risk off. 

[1]. The trigger to the collapse of Europe, the global financial system and capitalism as we know it lies with the financial stocks. Heads they lead us out of purgatory into a new, frenzied era of profits, housing bonuses and derivative trading products. Tails we look back fondly on the collapse of Lehman. Place your bets. Risk on.

[9]. Forget Greece. There’s a mergers-and-acquisitions boom coming in the tech sector as the doors to tens of billions of dollars of corporate cash hoards are thrown open to spend on buying Yahoo YHOO +3.38% , Hewlett-Packard HPQ -0.12% , Research in Motion RIMM -0.66% , Netflix NFLX -1.59% , and AOL AOL +0.96%  at crazy cheap prices. In the end, there is only Zynga, and we are all merely characters in its Animal Farm game. Risk on. 

[6]. When investors do return to fundamentals, and they always do, they will find the bond bubble still there and Treasuries will be the last place to be, as yields leap and China cashes in some chips. Stocks, overlooked now for more than a decade, will finally attract attention again and the dollar will trend shift back into its traditional reserve currency role. Companies will start hiring again and someone will offer to buy your house. Risk off. Hope is not an investment strategy, as they say. 

[4]. Buy-and-hold is not dead. It’s just not fun, as proven by its performance since 9/11 a decade ago. But considering what everybody was thinking about the future after Sept. 11, 2001, it hasn’t been the worst investment plan either. Afghan heroin poppies? Now those were a bad investment. Risk on. 

By David Callaway is editor-in-chief of MarketWatch.