Thanks to the above traders for reading some of the stuff I write, I do spend quite a bit of time trying to help. Today's sad events had some impact on trading at this level, 2 perspectives that I can point out right now. FYI, I am in Reno at the moment, and it is arount 12:50 ET. I placed opening only orders, based on FV calculations from my remote office, as I do every day. We saw the tragic air crash in NYC, and were unsure of what the total impact would be...still are, for that matter. It took about 30 minutes to get out of all the "buys" that I ended up with, and I made a meager profit (about $1,000), after all was said and done....this is not significant in itself since I have been trading a long time, and remain pretty calm and feel that I can evaluate a market condition pretty well and not "panic out" which would have cost me about $5,000. What is significant, is that this particular office did not have the our internal squawk box on that connects all the offices, and so we did not hear the cry "cancel your buy orders" on your O.O.'s This was done in our main office, and saved the traders a great deal of money and grief from the immediate sell off below FV calculations and opening orders. This re-emphasizes the benefit of being in an active office filled with excellent traders who trust one another enough to listen to what was being said. So, if you think this through, you may see a couple of points that could help you in your trading. As always, our hearts go out to the victims in NYC, and we hope that the crash was not intentional or terror related. I hope you are all well.....
Or you could've had your news ticker or CNN on, heard of the crash, and concluded for yourself that it might not be a good idea to go long. Wait for the markets to sort themselves out (most likely a quick drop) then a buy the bounce. Could've done nicely today on a lot of stocks/indexes.
You're right about the post opening trading, which went very well, but since most of our people place opening only orders (the "nuts and bolts" of each trading day), a missed news item or (as in my case) a minor distraction could have been costly. We try to keep all the TV's on with generally only the close captioning on so we can hear the squawk box from the CME.
Ok, This is meant for anyone who is ticked that Don won't be specific about strategies. I I'll share Don's 2 favorite strategies in detail: 1) Move to Las Vegas. It's a zero income tax city in a zero income tax state. Also, your property taxes will be less than 1% of assessed value. 2) While you are here, convince the casinos you are the type of gambler they seek. This will allow you to collect, literally, tens of thousands in "comps" per year. I realize these have nothing to do with trading, but they certainly factor into the entire "wealth" equation.
Don! How many stocks & how many shares do you put opening only order? Do you usually put opening buy order? When do you get out of your position?
The last few months I am putting in buys and sells on 13 different stocks. 2000 shares each, averaging about 80+% profitable days (for the year). I am usually out within 15-30 minutes after the opening (about 35 minutes yesterday, Nov 12 due to the plane crash, and yes I made money...although it took a bit longer than normal).
Don I'm a bit slow to the party, (my timing has been off recently) but I would like to thank you for some excellent and very insightful posts recently, in this, and other threads. I was one of the people who criticized you and your firm earlier for your attitude towards amateur and Nasdaq retail traders. However, since then, you have shown a great willingness to share your knowledge and considerable experience with us, without any sales pitches or condescending remarks regarding 'real' traders. Please keep it up. We all have something to learn from you.
It really does mean a lot to me to hear some good words from you guys. I will keep doing what I can to help.
Hey Don- I attended your class in August and have been using the open-only orders to a good deal of success in the last few months. I think the people on this board should appreciate any advice/strategies you give - this forum is a lot cheaper than going all the way to LV for class. That being said, it was really a super class, and I work for a competitor firm so there is no reason for me to hype it. I had a few follow-up questions about the pairs trading - specifically when you talk about using several "envelopes" during the day does this mean putting bids below the market and offers above to catch the gaps? Or are you just referring to adding and subtracting from the pos. sizes. Thanks, Ace. p.s. I hope nobody out there got too badly burned on the PVN/COF pair - or at least that they were holding the PVN leg short and the COF long overnight. Did people reassess the spread before it was too late or did those trading it just reach their loss limits and bail out at a loss?