don i would like to know how you got started in the business and how long it took you to learn when you finally learned what type of money were you making as per cents per share and how constant were you meaning how many days a year do you loose money to the market thanks
Trade555 please dont take offense at this criticism however would it be possible for you to use a period full stop to any Brits in your writing as it makes it difficult to read your posts without having to reread and reread and reread to fully understand what you are trying to say i suspect you may not care how you're writing looks to others and you just type as quickly as you can and you think its none of my business but it can be a little annoying at times i assume you are an educated person so why not give it a shot as it can be hard to take someone seriously who does not use the english language good
Hi all, I did not start this thread, and I certainly hope that the "Brit" was not referencing my lack of proper punctuation. I also realize that when keying in messages, that many of us sometimes just type away, and I personally don't have any problems with how you get your message across. So, now that we "cleared that up." .....I will say that I am glad to post a little history about our (family) trading, how we got started and all of that. I would prefer to put it into a different post, perhaps next week (I am taking a couple days off this weekend, visiting one of our offices on Monday, and will be back to my office Tuesday). I thank you for your interest, and will post some notes...don't want to bore anyone to death or appear self serving.
I will start with the "how we got started" (I tend to write and speak in the collective "we" since my brother and I are usually answering questions together, sorry if that bothers you). We started on the Options trading floor (PSE) in the late 1970's .., then, we started doing brokering on the equities side for ourselves and other professionals on the floor, to save costs for our own trading, and to improve on the "fill" quality. My brother went to Chicago when they started trading the S&P 500, and traded on the CME and the CBOE. I stayed on the PSE, and went to Chicago when we were doing "upstairs" trading and doing "across the street" arbitrage (basically futures and options on futures via the OEX and baskets). Long story short, we both stopped around 1989, and my brother got back into it with a longtime friend and trader, and started Bright Trading in 1992. I came back aboard in 1995 to help with the growing of the business, provide the training, and to, of course, trade myself. We have done extremely well, have hundreds of traders in 42 trading rooms in the US and Canada. I took some "hits" when getting back into trading, since it was a lot different than floor trading in so many ways. Options and futures where great on the floor, we had an "edge"...but the "edge" came full circle back to equities around the time that the "bubble" started, because so many new players came into the game who had no idea about how the markets worked (ala SOES, SOES bandits, SOES busters, and that whole "electronic" trader game).After "getting back to basics" myself, and combining what we learned on the floor with the technology, we were able to "lead by example" and actually show people what worked in real life. We did well as a firm (because our traders did well, much better than the "norm"). We outlived many firms who were preaching nonsense (IMHO) about how to make money, simply because we had the experience of trading various markets, and saw how the whole game was played from the Specialist on down through the brokerages, clearing firms, etc. Again, IMHO, there is no single strategy, piece of software, or any "buy when green, sell when red" gimmick out there that can beat plain old trading tactics. As far as the $$ per share and all of that, I simply used the facts from our trading firm...not a big deal, just simple facts. (sorry if I was too long winded)
Don, What are your thoughts regarding single stock futures and their impact/opportunities in using them for trading equities. I got to believe there will be opportunities in the beginning. One will have to lead the other. Thanks
When they list the single stock futures, we will be implementing various new strategies. The obvious will be the "arbing" between the futures and the underlying based on interest rates and FV. After that, we will explore the liquidity and depth of the markets, without which we won't be able to develop much of an edge. The addition of these vehicles will lead to elimination of the short sale uptick rule (much talked about already), and open the doors to much better pairs and arb possibilities. Can't wait!!
Don, do you know what stocks will have single stock futures and also, on what exchange do these instruments plan to trade on?
As of this writing there is still "squabbling" going on between the various exchanges about who will list what, who will have a "primary" market (if anyone), and who will get the choice issues. I think we will not see any actual trading for a few months. We (Bright Trading)are meeting with the "head honchos" from Spear, Leeds, and Kellog and Goldman Sachs (I believe) in about 10 days, and this is one of the questions that I will asking. I am writing an article about the potential trading strategies and how they (single stock futures) may impact both the equities markets and the index futures markets. As I said before, there are some obvious events that will transpire, and I will touch on them, but I am trying to focus on the more interesting concepts. If we simply use the basics of divident yields and interest rates we see some "cool" plays on the horizon. When we add "basket exchanges" and "pairs" tracking to the mix, we should see some nice techniques evolve. "Stay tuned" as they say!
It seems to me the edge in these single stock futures will go to the liquidity providers. I want to buy on the bid and sell on the offer. I imagine the spreads will be wide in the beginning. I would want to set up the "conversion". I think being long the stock and short the future will give great opportunities to buy the future in the hole as all the not longs try to get short, then hit the bid in the stock with my long stock. Sell the futures on the rallies and buy the stock on the pullback. I think the worth of the futures will be a direct correlation to the cost of maried puts too. If the cost of the bid on the NYSE less the cost of the married put is greater than the price of the future well then wack the stock. If these single stock futures trade at fair value then there is no edge. The edge goes to the trader with the lowest carrying costs and those who get short stock rebate. Too many traders are thinking of these futures as a way around the short sale rule. A good trader who can read the tape should anticipate a down move and get short naturally. As a help to arbitrage, I don't see it. Are they going to be electronically traded? Equal access to BD's as well as customers? What are the execution costs of these things? I don't think single stock futures will have much of an impact on trading. I think if they made options electronically available to proprietary traders then I would like to use the deep in the money calls or puts to get long or short. Don, am I wrong?