FORUMS BROKERS SOFTWARE
Home
 
    Forums > Trading for a Living > Career Trader > are you in the 1%?


Reply
 
Thread Tools
Old Aug 9th, 2012, 05:04 AM   #1
njrookie1
 
 
Join Date: Nov 2011
Posts: 272
The academic type is finally recognizing the existence of successful traders.

http://faculty.haas.berkeley.edu/ode...l%20110523.pdf

Quote:

We document that only the 1,000 most profitable day traders (less than 1 percent of the total population of day traders) from the prior year go on to earn reliably positive abnormal returns net of trading costs in the subsequent year. But, the stock picking ability of these investors is remarkable. Top day traders (based on prior year ranking) earn gross (net) abnormal returns of 49.5 (28.1) bps per day on their day trading portfolio, while the tens of thousands of day traders with a history of losses in the prior year go on to earn gross abnormal returns of -17.5 (-34.2) bps per day.
    Quote
Old Aug 9th, 2012, 06:37 AM   #2
gmst
 
 
Join Date: Jul 2011
Posts: 4,439
Odean is only one of the few worth listening to!

Thanks for the link.
    Quote
Old Aug 9th, 2012, 06:45 AM   #3
ocean5
 
 
Join Date: Feb 2012
Posts: 934
Less then 1% are using market orders,turns out.
    Quote
Old Aug 9th, 2012, 11:08 AM   #4
njrookie1
 
 
Join Date: Nov 2011
Posts: 272
the top 500 (out of 360,000) traders are probably taking lots of breakout trade.

it is also interesting that the commission is about 1/3 of the gross return. it tells how careful one needs to be for risk management and how small the edge is. at almost 0.3% per day after costs, it is very good if one belongs to that top group.

njrookie
    Quote
Old Aug 9th, 2012, 01:11 PM   #5
vinc
 
 
Join Date: May 2007
Posts: 294
that's why swing traders and long term traders are perceived as likely to be more profitable than day traders which probably is only a matter of 'focus' - give them enough ' frequency' and the statistics will look the same..
yeah, whatever.. good thing is we all win here and that's what really counts! a buck here, two bucks there - who gives a f. ?? ;)
one thing seems important though - the number of trades , countless number of trades /in case of profitability/ - and only then one can arrive at some conclusions..
    Quote
Old Aug 9th, 2012, 01:17 PM   #6
vinc
 
 
Join Date: May 2007
Posts: 294
one more thing - this 1 % .. would that be a proof that markets are not random??
    Quote
 
Reply
Thread Tools

Forum Jump



   Conduct Rules   Privacy Policy   Sitemap Copyright © 2014, Elite Trader. All rights reserved.   

WHILE YOU'RE HERE, TAKE A MINUTE TO VISIT SOME OF OUR SPONSORS:
Advantage Futures
Futures Trading & Clearing
AMP Global Clearing
Futures and FX Trading
Collective2
Automated Trading Services
CTS
Futures Trading Software
dom993trading.com
NinjaTrader Consulting
eSignal
Trading Software Provider
FXCM
Forex Trading Services
Global Futures
Futures, Options & FX Trading
Interactive Brokers
Pro Gateway to World Markets
JC Trading Group
Direct Access Trading
MB Trading
Direct Access Trading
NinjaTrader
Trading Software Provider
optionshouse
Option Trading & Education
Rithmic
Futures Trade Execution Platform
SpeedTrader
Direct Access Trading
SpreadProfessor
Spread Trading Instruction
thenut-trader.com
FX, Gold, & Stock Signals
TradersStudio
System Building & Backtesting
Tradier
Equity and Options Trading
Trading Technologies
Trading Software Provider