Don Bright's "Core Positions"...

Discussion in 'Trading' started by fatrat, Dec 6, 2005.

  1. fatrat


    I called Don Bright's radio show about 2 years ago when I first started to have an interest in the stock market. He said he trained his traders to manage a "core position." I didn't think much of what he said, up until recently when I started to re-evaluate how I exit my positions.

    Does this mean that they pick key levels, look for institutional buyers, and then grab as many shares as they can? If it goes up, they off load a little bit. If they see more aggressive buying, they add a little more? Anyone know if their suggestions for "core position" management are documented anywhere? I googled, but couldn't find much. My exit strategies need a lot of work.
  2. No difference between a 'core' position and investing. Just a name game.
  3. core position means you have a stock you want to own long term. if it has a spike up you sell a little hoping to buy it back cheaper, if it drops you buy a little more for a trade, but you always keep a "core" position on.
  4. Maybe he IS moving more into swing trading? A core position never should :()
    imply investing (which is buy and hold)
    when you talk investing with "timing" it is swing/LT trading...that's simple....
    I suspect it is a radio BS- talk talk to recruit more LV gamblers to the Vegas trading world.
  5. fatrat


    So it has no relevance to short term trading?

    Does anyone trade around a core position in intraday trading?
  6. Sanjuro


    'Core Position' at Bright refers to a long term position that takes advantage of the 8% avg gain in the market each year. They trade around the position but try to keep the same number of shares going into the close.

    Market is going down, I'll sell a few thousand, and buy it back few cents lower.
    Market is going up, let me add a few thousand and sell it after a few cents up.

    There are traders at Bright who scalp GE for 2-3 cents everyday for thousands of shares while holding a core position of 10,000 shares. They never sell a purchase at a loss and just hold it till it comes back. They say they don't have to worry about it because they know GEs fundamentals and it's safe.

    Good Luck!
  7. 1. No. It has plenty relevance to short term trading IMO.

    2. Yes, I always trade around a core position. I never enter with full size and I always adjust my cost basis pending the trade's positive or negative movement.
  8. Famous last words, There is no such thing as a safe stock. A theoretically sound concept, but one that is hardly worth executing! Consider this, Bright makes a lot of money charging their traders haircut, and the more money you have tied up in overnights, the bigger their take on their insurance. (I know, they give 2:1 with no hair cut, but after that, it's 12% or some insane number like that, and how many "units" can you get stuck with that were suppose to be a trade for 3 cents that turns into an overnight swing position that is 20 cents against you)

    A better strategy is to do some serious research and develop an overnight edge with a portfolio of stocks, one that yields greater results than a mere 8%, and one that exceeds the costs of carry including haircut. And follow that strategy.
  9. =============
    Agree the former ''is hardly worth executing;''
    even in an uptrending bull market,
    sounds like an excellant way to blow up even faster during a bear market .:cool:
  10. Instead of holding a core position, why not just increase the size of the 'swing' position when trading it in the same direction as what the 'core position' or bias would have been?

    I've never day traded stocks, but when I put on a futures position, I've already established a long term market bias based on long term fundamentals or what I perceive as the 'trend." I'll execute trades based mostly on techncals, but I'm either even or trading in the direction of that market bias. (Though I do break this rule sometimes.)
    #10     Dec 6, 2005