Agreed. This kid must be trapped in some kind of "time-machine" from 15-20 years ago. Think floor traders on the NYMEX or the CBOT have a great big "edge" compared to the specs and commercials that plow into the market and rip everyone's head off in the process? Think again. Yeah, everyone DREAMS about being a local in a pit and selling that last 50 lot of the 1200 lot buy order . . . the only problem is that no one ever sells the last tick ( that's usually seen by a "bag-man" ) and even if you did, you probably got short 50 cars on the way up ( along with half the pit ) and are completely "underwater" and praying that the order is done and no other paper is about to hit the ring on the buy side so that you can weasel your way out with a tidy scalp. I know. I've been "there" far too many times. And . . . it isn't a whole helluva lot of fun.
There are two themes that keep coming up on these threads: no one makes money at trading. The ones that do have an iron cast edge which continues into eternity. Guys trading less than ten years acting like they have seen it all. :eek:
Hi guy990opl, I have never had he experience of making 34% in one year much less last year. So I am completely unfamiar with what a person in your situation endures. Intraday trading is very different and mostly relates to the market's offer as the day progresses. Secondly it relates to the leverage a successful day trader uses. This simply means that the definition of a successful day trader has little to do with sitting in front of a screen during the day for very much of RTH. By looking at what a lifestyle costs, there is no lifestlye that requires an intraday daytrader to spend much time in front of the screen. Your valuation of using a % of capital is right on the mark. To compare this % to a lifestyle I would say that, given a 500,000 per annum lifestyle ,and if a person who trades two hours a day only, he would need to have enough margin for 5 contracts as his capital. This could be 2,500 to 10,000 dollars. What you did to make 34% and have the 34% represent 500,000 net would be about 1.5 million in capital for trading with no leverage. Any successful intraday trader has to do more than trade intraday simply because he has to place his profits somewhere so they make money if he does not want to get into partial fills when the contracts get above a certain market capacity level. 5 contracts is a chicken feed level of trading for the two hours a day of the trader in the example. Trading 50 contracts would be just as natural but that would take a captal amount of 25,000 dollars. Putting money in position trading or sector rotation takes about 30 minutes a day; multiple streams are used in each set of accounts. Position trading is at a rate of 100 turns a year @10% a turn. Sector rotaing is 4 to 5 weeks a turn and only about 4% a week. So, the definition of a successful intraday trader is that the trader only trades on the days he wishes to turn on his setup. When he does choose to, he only trades a couple of hours in that day. There is one caveat, however. Such a trader would have a lot of other things to do and they may cost a little money. For example, a glider weighs 840 pounds and costs low 6 digits. The custom is to run the towing account by adding 5K a pop. Tows only last a few minutes but the tow time is more than a nickel a tow. Hanger storage is not cheap either.
Hey Landis, Yeah, I think this kid is a bit lost with those pit comments. I never traded down on the floor, but a bunch of my friends were locals in the bond and SP pits in the late 80's and 90's. Before the screen they had a HUGE edge. Then when the emini's appeared they made a killing arbing the pit vs the screen. All of them except one guy I know left the pit, and the one guy down there takes HUGE risk just make a few grand a day. Problem is, he gets run over once a month and loses a ton. The days of the pit guys having any kind of edge are long gone. They don't prey on retail guys like that kid said. I spent 10 years in Chicago drinking with pit guys....gambling with pit guys....almost getting arrested with pit guys. Are some of them are the best guys out there....but....their game is history.
Yeah, I dont get what the guys who bitch about trading are trying to accomplish. They whine and whine about trading being over...time to find a new career.....blah blah blah. Usually it's a newer guy that failed. If they failed no big deal.....a lot do...but why come on a trading board and complain and whine like a little girl ?
So everyone is going crazy because I said floor trader when I should have said black box, but before I also said ... "The fact that I can not daytrade or don't know good daytraders does not mean that it can not be done. Agree on everything you write except the time frame. Daytrading is the hardest way to make money." EPardo says that "trading is trading" and the time frame is irrilevant, yeah right ! Given that one has a plan and an edge personally I find much easier to target 1% - 2% every month. That is my goal when I sell options. It is very boring, but the stress level is also very low. And the money I make when I do, is limited. In 2006 I made, 31%, luck. In 2007 I made 64% it was luck. Last year 34% still luck, so I am trying to take the luck part out and focus on a consistent, yet modest 1% - 2 % each month. This year, I am flat after six entire months, BUT my drawdown a few months back was no more than 6%. 2008 was a positive but my drawdown was 40%. Now there are less gains but less losses I like it much better that way. Once I figure out how not to lose much, I am confident that I will make it. As long as I have the capital/cash to buy another ticket does not matter how many trains I miss. I learned that one could make a lot of money with fewer probabilities OR little money with higher probabilities, it is a give and take. Sure I could try to double my money, but the risk will be higher and even if I do it would be luck. I would highly doubt to be able to double money every year. If I can make 15% -20% on a capitalized account, think six figures or more, I am happy. That's why I am not a daytrader. I don't have the stomach for it, and even if I did it would not be enough. In my modest experience even the daytraders who made money for a few years ended up quitting, or stopped. Why ? Because it is harder than other trading approaches. If all of you are successful daytraders it is impressive, but if that is the case all of you are the exception and not the rule. Sure there are 100 ways to make money in the market and even more ways to lose money, but where are all the successful daytraders everyone is talking about, just where are they ? Yes, they must be out there but extremely FEW in number on ET there is Neke, not sure who else. You guys are certainly right on the fact that my limited experience in the market means nothing, but one thing I learned... ...the majority of daytraders and people who likes "action" are market losers ! Several books talk about daytrading and are pretty accurate on the facts: 1) you must act instantly if you take time to think you are dead 2) daytrading chews up a great deal of time 3) daytrading plays into people 's gambling tendencies Basically it is a paradox because it demands the highest level of discipline, while attracting the most impulsive, addictive and gambling oriented personalities. Now you can say all you like that trading is trading blah blah blah that there is an army of successful daytraders blah blah....the majority of retail daytraders are losing money. That's reality ! If you feel you can argue this go for it, you can have the last word. Just remember that the market will take care of everything and tell you if you are right...or wrong.
It's pretty simple. You are like a few others on here. You failed (or are afraid) of daytrading, therefore you must knock it. Your claims are ridiculous (Daytrading takes more time? ......that is beyond stupid). People like you are clowns....just because they can't do a certain strategy, it means that strategy doesnt work. You use the word loser a lot I see. Actually, it describes your behavior on here. The little I can tell about you from your posts is you seem very lazy and are content being lazy. You use words like easier, boring, low stress level and limited. Sounds like someone who doesnt want to put the time in to do better. If your goal is "not to lose much" then quit now. That scared mentality will lead to failure. You seem terrified of risk. You seem like a very backwards person. Usually the guys who are more risk averse will tend to go towards shorter term trading/no overnight positions. Newsflash amigo.....you can lose everything being caught overnight on the wrong side. Ask the guys who were short SP puts the weekend LEH went under what Monday morning was like.
and you are a miserable idiot who can not read engish so I will cut and paste what I wrote already two times. Now it is in capital letter ( this is the third time, try to pay attention ) THE FACT THAT THAT I CAN NOT DAYTRADE OR DON'T KNOW GOOD DAYTRADERS DOES NOT MEAN THAT IT CAN NOT BE DONE.