after 15 years of trading i've learned alot. i started in 1990 and i'll never forget. i started with 300k in my account and commissions were $50 to $150 a trade. so i had to buy 2-5k at a time. my only quotes back then were phone quotes. i got up 90k from sept 1990 to dec 1990 and thought this was so easy. then i shorted into the iraq war. on jan 16th 2001 i got killed being short and gave back 1/2 my profits. i learned another valuable lesson in 1994 being long 7k shares media vision. i averaged in as it fell for weeks only to get hit with a huge preannouncement of an earnings shortfall and the stock gapped down 50%. i sold without a blink and lost 130k my biggest lose ever. i was so dejected but i was back trading the next day and have never looked back as i took all my lessons learned. THE GREATEST THING THAT'S EVER HAPPEND TO ME IS PER SHARE COMMISSIONS. my philosophy thats worked for me is to scale in and scale out. why not take advantage of the per share commissions to scale? how many people buy a stock ont he exact low? rarely ever so if you know you're not going to buy or sell the bottom or top why not scale in and get a better price? so if i want to buy 2k shares i'll buy it in lots of 300 or so. its very tedious but it works. this past week i traded over 1 million shares and i bet i traded 4000 times. especially for all the new guys i'd strongly suggest to try scaling instead of throwing 1k blocks qround. especially if you have limited capital of under 10k.
I also like to add my two cents. I don't know whether even myself completely believe and can convince others what I say but I follow this rule and I believe it is a good one: Don't try to trade market favorites and hot stocks that seem to be bubbled up. At least for one year and till your account allows you to trade 1000 shares of it. I mean don't trade GOOG or AAPL(specially GOOG - no long no short). If you think you can not make money on other stocks other than GOOG and .... then quit trading. Find some good high volume stocks and trade on them.
Another tip: Don't trade stocks that have history of less than 2 years and don't trade penny stocks to begin. Also if you want to trade on 100 shares, change your broker from Scottrade to IB (only if your account is over 25K)
why would u have to trade 1000shares on aapl to make money? 30-50 shares are more than enough if u are inexperienced and make 5-6 rt. Also aapl is one of the easiest stocks to trade @open on the long side and liquidity is plenty there to get out if u are wrong: I know the stock inside out and have rarely seen a bad day for longs; also pretty easy to scalp due to the predictable volatility. Aapl is very much forgiving for beginners if trades are let to run and losses cut short: if u learn nothing and cannot do that after a series of losses got out of control, I am sorry to say u are in the wrong business.
In my opinion, lots of moo moo crowd on AAPL. You can only daytrade it with no position at closing. Just one analyst's opinion, can move it more than a couple of bucks and a big gap at the open could be above your stop loss.
I luv the stock and r/r for longs has been unbeatable for years on aapl. I cannot think of a better stock to hold overnight, especially after report with blowout numbers. Those down gaps are rare to come by as are analysts downgrades: risk is concentrated on the upside. If anything, gaps down offer excellent buying opportunities.
ksonsinc. Here is my advice: 1) Cut loses short. let winners run 2) Follow the trend 3) Add to a winner not to a loser If you wouldve followed these simple three rules you wouldnt be were you are. But now that you are there, take it as an experience and dont let it affect you on Monday. Come in as if it didnt happen and dont try to make it all up in a day or 2. You can do it just go slow and wait for the right moments to get in. Good luck!
Wow, great advice on this thread, I think I am going to dig this forum. My plan, like Joey's, calls for scaling in and scaling out. For me it works really well in most market conditions and is high probability. The problem is that when it fails, it hits you hard and the trick is to be able manage that. I am not sure I would recommend this type of trading for newbie traders though as the infrequent but large losses are hard to deal with and money management is considerably more complex than many styles. Friday's conditions are a perfect example. If you are scaling in looking for a pullback or reversal and the market goes straight in one direction, it is going to hurt. I haven't had a negative day all year, and maybe a only a small one a week or so before that, but Friday I gave up $6700. Of course that hurts, but you just need to be able to trust your experience and know that the plan really works despite the occasional hit and keep focused and take the opportunity to examine what you may have missed to help you avoid getting into the trade. Scaling can be very effective in raising and lowering averages and raising win ratio, but if you don't know how to manage the downside you will blow up. To the original poster - I feel your pain, loosing money sucks, but it is part of the game. In fact, it is one of the most important parts of the game. Since you are new to trading, you need to manage the risk to you account first and foremost. This is the ONLY thing that is going to allow you the time it is going to take to learn how to make winning trades. You must go very very small right now. Rather than focus on number of shares, I would recommend you evaluate how much you are willing to risk per trade, and then determine share amounts by that. For example, if your trade dictates that your stop is 1 pt., and you want to limit your loss on any given trade to $100, then you can buy 100 shares. If the stop is 2pts, then you can buy 50 shares. The most important part is looking at your account and determining how much you are willing to risk on any given trade. Since you are brand new, I would recommend risking no more than .05% of your account on any trade, and maybe more ideal .025%, depending on how much you have. That will allow you quite a few losses without going through you account.
as far as scaling i'd take 2 or 3 scales and have a set stop loss on the avg of the scale. so if you were going to do 200 share scales on aapl scale in 3 times and have a set stop on the avg. but a traderust be able to smell a washout market like friday and not scale but scalp bounces with 1 order. for instance i had a core goog short friday but i also scalped tons of bounces in my other acount. by 11 am is was apparent friday had problems. hey nothings guaranteed in this bus and things for any trader can turn ugly fast and everyone must look at there own risk profile
Well i was doing good before i had the big loss When ever i traded 1K shares that day i lost money dont know why I know FRI was a exceptional day cause a lot of pll went long at 1 then at 2 then at 3 and even experience pll lost money I know i was not supposed to pay with 1000 shares ( i FUCKED UP ) i know that but well now i a scared and learned and more knowledge and i know that i can make $100 to $150 playing 100 shares then risking 1000K If 1 trade goes wrong no problem as long as i am not lossing $300 to $400 in 1 minutes with 1K shares I think i will SCale in and out and try to average $100 to $150 a day till a month 2 or 3 till i make sure i have Risk mangement liek some one said look to make $10 to $20 a trade I usually trade aapl intc QQQQ dell csco ebay yahoo ( but i will never touch Goog cause the chance of me gettign wiped off are very good on this stock. ONE IMPORTANT QUESTION some oen tols me not to trade between 9.30 to 10.30 due to voilatily only if it is gap down day or soemthign like thn it is ok Some one told me you can make a lot of money btween 9.30 to 10.30 what would you,ll suggest and on what bases please advice is greatly appricated : - >