Posts by jack@benzinga.com

Benzinga increases client engagement & trade-lift with actionable alerts, rumors and unusual activity. Articles cover micro to macro-cap's across all sectors.


What is a Stock API and Market Data?

Today we will talk about Market Data and Stock APIs. We’ll split this post into two sections:

1) What is an API?

2) Market Data and Stock APIs

Part 1: What is an API?

        API, or application programming interface, basically describes one way to plug your website into another. Commercial sites make some parts of their code available to developers so that they can build tools for the site. The code they expose is called the API and the stuff they build, such as widgets, are called applications. Developers can use different APIs in different ways to build different things. For example, let’s look at KAYAK, a fare aggregator and travel metasearch engine which aggregates information from a number of different airline databases. The travel service interacts with an airline’s API. The API is the interface that can be asked to get information from the airline’s database to book seats, baggage options, etc. Then, the API takes the airline’s response to your request and sends it back to KAYAK, which then shows the updated and relevant information to its customers.

Part 2: Market Data and Stock APIs

        Now that you have a basic understanding of how APIs work and what they can be used for, let’s talk about how APIs are useful in the world of stock trading. There are countless APIs offered for financial data. We’ll use Benzinga as an example because we offer over 60 financial data APIs on our website, https://cloud.benzinga.com/. Similar to how KAYAK interacts with airline’s APIs to obtain the relevant and updated information, Benzinga’s customers can purchase access to our APIs and use them on their website, platform or application to receive market data, news and other types of financial data. For example, say a customer wants to buy access to our Analyst Ratings API to use on their trading platform. Once purchased, our Analyst Ratings data is available to the customer through our API, which would then show up on their platform for their customers to see.

       You may wonder, what are the different types of market data and stock APIs? Benzinga’s data catalogue lists industry-leading stock, market data, news and other types of financial APIs. Here’s a list of some popular financial APIs from our website:

  • U.S. Real-time and Historical Quotes
  • Analyst Ratings
  • Market Data (equities pricing for equities listed on NYSE, AMEX, NASDAQ, OTC exchanges)
  • Charts for U.S. Equities
  • Options, Futures, FOREX, Indices Data
  • Cryptocurrency Data
  • Fundamentals, Balance Sheets, Cash Flows, Income Statement data for U.S. Equities
  • Benzinga Newswire & Signals Newswire (headlines, price movements, rumors)
  • Dividends, Stock Splits, Guidance, Conference Calls, Earnings & Future Earnings Dates

This is a small section of the data products Benzinga offers in API format. Hopefully you learned something about APIs and Market Data/stock APIs in this post! If you have any unanswered questions please send us an email at licensing@benzinga.com and we’d be happy to answer them!

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Commodity and Index APIs

What is a Commodity?

A commodity is raw material that is typically traded on a market. These commodities can be categorized into 4 main groups: metals, energy, livestock, and agricultural. These commodities are worth their spot price, or the price that it can be traded at any time in the market.

What is an Index?

An index is an average of a certain section of the market that is used to measure the market as a whole. Some of the different indices include the Dow Jones Industrial Average, S&P 100, Russell 2000, and the CBOE Volatility Index.

What Are the Different Types of Commodity APIs and Index APIs

There is a plethora of both commodities and index APIs:

Commodities:

  • Silver price
  • Oil price
  • Rhodium price
  • Coal price
  • Steel price
  • Copper price
  • Coffee price
  • Natural gas price
  • Wheat price
  • Cotton price

Indices:

  • Dow Jones Industrial Average
  • Russell 2000
  • S&P Global 100
  • BDI Index (Baltic Dry Index)
  • Investor Sentiment Index
  • Consumer Confidence Index Data
  • Nikkei Index
  • BPI Index (Baltic Panamax Index)
  • CBOE Volatility Index

Why is a Commodity or Index API Useful to Me?

An API may be useful if you are looking for any information related to commodities or indices. These commodity and index APIs contain data sets that contain important figures and statistics. These data sets let you quantify the information and use that information systematically. Quantifiable data is important because investors need to be able to make trades based on that information.

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Crude Oil Prices

What Drives Oil Prices?

OPEC, or Organization of the Petroleum Exporting Countries, is composed of about 15 nations that produce half the world’s oil supply and house over 80% of the world’s oil reserves. This gives OPEC a huge international edge regarding influence on oil prices.

OECD, or Organisation for Economic Co-operation and Development, is a group of 35+ countries working together to promote international trade. Originating in 1957, the OECD consists of mostly developed countries whose people have higher levels of vehicle ownership than non-OECD countries. Crude oil prices can be affected by various global changes. This includes economic growth, expectations of economic growth, production from OPEC and Non-OPEC countries, ect. Crude oil plays an integral part in the commodity market.

 

Recent News on Crude Oil

June 22nd, 2018 marked the 174th meeting of OPEC in Vienna. Oil prices rose over 5% after the conference. OPEC released a statement that they are adding one million more barrels per day to their output. Why would a supply increase announcement raise prices? Maybe because a larger supply increase was expected than one million. OPEC nations are currently producing oil at maximum levels, and those levels are falling. The outlook for oil indicates a situation where this shortage continues. President Trump has attempted to get other countries to follow suit with the Iranian sanctions while also pressuring Venezuela.

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Interest Rate Hikes and What They Mean for You

Why Does Fed Change Interest Rates?

The Fed changes rates to maintain a healthy economy. If the economy is slowing down or experiencing negative growth the Fed might decide to lower interest rates, which will make money more available to businesses and consumers. If the Fed thinks the economy is growing too quickly, they will raise interest rates to slow things down and limit inflation.

 

What Happens When the Fed Changes Rates?

When the Federal Reserve (Fed) raises or lowers interest rates a chain reaction is set into motion. When the Fed raises interest rates, banks raise their prime rate, which in turn affects mortgage rates, car loans, business loans and other consumer loans.

Lower rates interest rates usually spur the economy by making corporate and consumer borrowing cheaper. Conversely, higher interest rates are intended to slow economic growth or curb inflation by making borrowing more expensive and less attractive.

When the Fed changes rates, it usually is adjusting the Federal Funds Rate. The Federal Funds Rate is the interest rate that banks charge each other on overnight loans.

What Rate Changes Mean for You

When the Fed raises rates, you can expect:

Higher:

  • Prime Rates
  • Credit Card Rates
  • Mortgage Rates
  • CD Rates
  • Money Market Rates
  • Car Loan Rates

Lower:

  • Borrowing
  • Consumer Spending
  • Home Sales
  • Business Profits
  • Stock Market

 

Conversely, when the Fed lowers rates, you can expect:

Higher:

  • Borrowing
  • Consumer Spending
  • Home Sales
  • Business Profits
  • Stock Market

Lower:

  • Prime Rates
  • Credit Card Rates
  • Mortgage Rates
  • CD Rates
  • Money Market Rates
  • Car Loan Rates
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Federal Funds Rate

What is the Fed Funds Rate and Why is it Important?

The interest rate at which banks and credit unions lend money to each other, generally on an overnight basis. The law requires banks to keep a certain percentage of their customer’s money on reserve. Since banks do not earn interest on reserve money, institutions with surplus balances in their accounts lend those balances to institutions in need of larger balances.

The fed funds rate is one of the most important interest rates in the U.S. economy, as it directly affects critical aspects of the economy including employment, inflation and economic growth. The fed funds rate also indirectly influences short term interest rates because lenders often set their rates based on the prime lending rate. The prime lending rate is the rate at which banks charge their favored customers.

The federal funds target rate is determined by a meeting of the members of the Federal Open Market Committee (FOMC) which normally occurs eight times a year. The FOMC uses open market operations (buying and selling government securities) to influence the supply of money to meet the target rate.
For example, if the FOMC wants to increase the fed funds rate, they will decrease the money supply in the system which pushes interest rates higher. This is referred to as contractionary monetary policy.

On the contrary, when the economy is sluggish, and inflation is low, the FOMC will increase the money supply to lower the target rate. This is referred to as expansionist monetary policy.

 

 

 

 

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