You think those guys are daytraders? LOL. Son, there is a major difference between a daytrader and short term trader. You better re-read your Market wizard books.
The following methods of Trout are typical for a daytrader: Risk Management Techniques Employed Loss limit of 1.5% on every single trade; will liquidate trade if breached. Loss limit of 4% of total equity on every day; will liquidate all positions and stop trading for the rest of the day. Loss limit of 10% of total equity per month; will liquidate everything and stop until next month. At the end of each month, they decide the maximum volume they will trade in each market. Philosophy and beliefs Believes that whoever has the highest daily Sharpe ratio is the best trader. Trout believes his success is explained by: Good research, being their edge. A rational approach to money management. Pays a very low commission. They have the best execution in the business. People who work for him keeps a large part of their net worth in the fund, including 95% of his. Trout thinks that the minute he doesnât have fun trading, he would quit. If he is in the business of picking CTAâs, he will base on the total dollar profit extracted from markets. He believes in moving averages, but not in Fibonacci retracements, Gaan angles, RSI and stochastics.
Most friends I have that work at hedgefunds daytrade. They never worked at MCDonalds. And for all intent, Steven Cohen does a BOATLOAD of daytrading, and he is a BILLIONAIRE.
Two things. If you're friends say they work at hedge funds and they say they daytrade you need to get new friends. They are lying to you! Second thing, Steve Cohen does not daytrade. He does do a lot of intra-day arbitrage but if you say Steve's a daytrader on this forum you will likely hear from his lawyer for slander.
Thats pure nonsense. Most of the US masses are long term investors and they exist for the sole purpose of losing their hard earned dollars. Most day traders are poor because of the 90% failure rate. Those that earn money (like me) and do not waste most of it (like me) start to invest as well. Any smart person with money or advisors starts investing. Hence your belief that rich people invest and poor day trade makes no sense. Money makes money and when you have millions it's very easy to just safely invest it and live off the proceeds. The day traders that made millions, actually kept it and stayed profitable now trade almost for the game not the profits. It's an addiction. The article was pure nonsense. The author focused on the piker loser traders and the high flying momentum trades as of late. I do not know how many of you day trade, but I know the stocks that I trade and research them. Not all of them, only the ones I like to trade often. If I trade something and it looks interesting, I do research on it as well. High volatility? Most of the market has been DEAD. For earnings week, this has been truly pathetic. And trading never really died off. There has been a niche almost every year, anywhere from NYSE scalping to the current Naz flyers.
E*Trade tracks the profits of each of the traders that log into it's network, and posts the top 10 at the end of the day. The numbers aren't late 90's-esque, but some guys are putting up pretty impressive #'s. On that day last week that TASR ran from 75 to 90 in 2 hours, there was a guy that made $293,000. Here's today's top ten..