simple strategy....but very profitable

Discussion in 'Trading' started by voltrader, Mar 26, 2002.

  1. Ever heard of a guy named PT Barnum?
    #11     Mar 26, 2002

  2. I once read an ActiveTrader article about a trader who said he
    had a trader friend who picked bottoms (I believe he was a
    swing trader) who would sell if the stock went down 5% or if
    it went up 10%. He said he did pretty good. Sounds kind of close
    to the middle aged woman you are talking about...

    At least the woman is cutting her losses short and isn't trying to
    hit a home run on her profits. I do income taxes and you would
    not believe how low people will let their stocks go down before
    taking a loss. The last few years have been incredible...

    #12     Mar 26, 2002
  3. tntneo

    tntneo Moderator

    don't be too wise guys...
    at least the lady has a basic expectancy plan and is actually trading (not investing).
    The real issue I would take is more all these articles about people 'making money', when you read them you either learn nothing or at least realize how little these 'traders' know.
    Of course during the bull days, they were more articles about every day people making a bundle : duh! 'been there.. 'done that.

    anyway I don't know what this woman does and who cares ?
    expectancy is important, but as mentioned earlier if trading stocks, you need a scanning strategy (unless you do specialist work) too, a direction strategy and so many other little things. I really find these articles useless and worthless. You will find better info and real life strategies on this board.
    #13     Mar 26, 2002
  4. I once took out the bid of 2000 shares on a short sale of YHOO. 10 min. later I bought it back for $3 less. MM's were shakin' the daytraders out, but I was tenacious and rode that puppy down. It was my nerves of steel that put 6K in my account, not a methodical approach to trading. Bottom line: trade with guts and the rest will fall into place.


    "Like a cobra, I strike @ anytime"
    #14     Mar 26, 2002
  5. It's all well and good to 'ride them down'.

    Care to list the times a small but real profit was there for the taking , but vanished forever due to 'strength of opinion' trading.

    I once sat next to a trader with nerves of steel. Had to wake him up a lot.
    #15     Mar 26, 2002
  6. does a steel plate in my head count?
    #16     Mar 26, 2002
  7. This is not trading by any means. Imagine waiting for a loser to go down 10%?? Buying a $70 stock, and holding it for $7 bucks!! I think not.

    This is, of course, just folly ...just something for people to ponder...and I know that you all here are way beyond thinking that there is anything that makes sense in this I'll leave it alone.

    OK, let's do "what if's" --- what if a stock only goes up 5%, then turns around based on market conditions...gee, we need to hold it because we have a "plan" --- "Plans" - like trading "systems" are just plain silly....but, judging by most of the comments, you already knew that....:)
    #17     Mar 26, 2002

  8. i can't resist this one. just as an aside there is more than $12 BILLION in the futures markets being managed by completely mechanical systems, 100% rule based, 0% discretionary. Some of these guys have been making solid returns year in and year out for more than two decades.

    silly profitable traders, plans and systems are for kids.

    wait, i forgot...there is only one way to make money on Planet Prop....
    #18     Mar 26, 2002
  9. trdrmac



    just out of curiosity of the mechanical systems that you mentioned, do you know how much of this is Arbitrage type programs vs. a technical type stochastic cross up through 20 sort of a system? My guess is that many of these system trades are playing one market against the next or spreading one contract against another.
    #19     Mar 26, 2002

  10. actually no, the vast majority of them are trend following systems that have low winning percentages (20-40%) but extremely high reward to risk ratios on their winning trades (often 5 to 1 or higher). Also just as an example Steven Cohen and Paul Tudor Jones, two of the most profitable traders for all time in terms of actual dollars won, both have said that 95% of their profits come from 5% of their trades.

    most of the big players in the futures arena and the hedge funds arena also (by big i mean anywhere from fifty million to a few billion under management) play longer term (days, weeks or months) because they are just too big to mess with arbitrage or scalping or any other size inhibited strategy.

    one reason that i am a swing trader, in addition to the fact that i'm not hyperactive and don't feel the need to be glued to a screen every second, is because i want a method that will not choke on ten or twenty million under management when i get there.

    there is nothing wrong with daytrading, but it will always remain a relatively smalltime game in comparison to what is possible with swing/position trading. as a swing/positional market neutral trader i can run a $20 million operation, collect profits on my own capital and 20% of investors' capital, and consistently make more than the best daytraders around year in and year out, with less effort and less risk to boot. :cool:
    #20     Mar 26, 2002