The real benefit of day trading under current market conditions is that you're flat at the end of the day and protected against irrational gap downs that seem to be magnified 4-fold vs. what would happen in a bull market. I mean, come on, RIMM misses earnings by a penny during an economic downturn and the stock loses 25% in a week. When even triple play stocks (upside earnings, revs and guidance) lose almost 40% after earnings (FLOW), it's just not safe to be an investor unless you're in it for the very long term. I have two long-term holdings on strong growth companies and they're both down 20%.
+1 Long term investors who can separate the wheat from the chafe, and recognize value, really can at least begin to think about building long term, productive positions now. That doesn't mean there won't be more temporary pain. But that's the price one must bear to build long term wealth (forget about making money near term).
Agreed 100%, which is why I have some long term positions in a few growth and dividend stocks (which are NOT down by the way). But it sure feels good to have a good chunk of cash backing up my day trading margin right now. In February I believed the DOW would drop to 10600 this summer and people thought I was completely nuts, insisting January was the bottom, then later insisting March was the bottom. Yesterday when it dipped below 11000 I started to believe my own prediction. "Get the Hell Out Part II" opened a thread a while back with "Don't try to pick a bottom" and after looking at 2001-2002 charts I realized the 7500 DOW doom-sayers actually stood a chance of being right this year.
daytrading is not scalable after 1-10M buying power, otherwise buffett would surely be a daytrader. daytrading is for people with little cash.
Yes "Renaissance represents a validation of the quantitative trading model and trades with such high frequency that it (the Nova fund, specifically) accounts for over 10% of all the trades occurring on NASDAQ some days." http://en.wikipedia.org/wiki/Renaissance_Technologies
Renaissance is not a person. How many traders do they have? I assume that OP stated that the dude makes 100K/day daytrading by himself. You can't compare performance of a group of people to that of a single person. On the other hand, one could divide the performance of a trading business by the number of people employed and get reasonable measure of performance that can be compared to that of an individual trader.
I was referring to this post. Daytrading is scalable to 10 million, 100 million, 1 billion and so on.
This is the age of the trader. The S&P is essentially now where it was in 1999 (in terms of inflation adjusted returns, it is down over that time). One day again it will be like 1982, and the age of the investor will be back, but it is not now.