Swingtrading Versus Daytrading Debate

Discussion in 'Trading' started by candletrader, Jul 15, 2002.

  1. Interesting comment, dotslashfuture... I have often wondered which style has a higher failure rate... I would hazard a guess that, other things being equal, a newbie starting out would have less of a chance of a blow-up swingtrading than daytrading, primarily a function of the necessity to make faster decisions and execute them with precision, and a function too of time-dimensional confusion when daytrading...
    #11     Jul 15, 2002
  2. It depends somewhat on the type of strategies you are employing. In Pairs trading, overnight positions are held often, even though many more overall shares are "day traded."

    Longer term investing or trading on an individual stock is not usually a good thing. If a trader has a decent profit, intraday, then they are happy to close it and go home....however, if they are losing money, they want to keep and and hope that it goes back up (we all know how well "hoping" works).

    Anyway, most of our serious traders only take home winning trades, not losing trades.

    #12     Jul 15, 2002
  3. I know a guy that has been a member of the CME and the CBOT
    since 1977. He trades mostly S&Ps and Bonds.

    He say's he's literally seen thousands of swing traders come and go.

    He's a daytrader. He usually makes 15 to 20 trades a day, and
    he's out of the market at the bell.
    #13     Jul 15, 2002
  4. I try to make my hope and fear backwards from how most people have it naturally. Most people hope that a losing position will get better and fear that a winner will go against them. This is true regardless of time frame or strategy. I just bought a book called "the day traders manual" by Eng, and in it he says your losing trades should always be daytrades, since you shouldn't hope that your losers will get better overnight.
    #14     Jul 15, 2002
  5. With swingtrading there is more scope to think about the bigger picture and create a well-designed swingtrading system (discretionary or truly systematic)... for those of us who prefer to take our time thinking things out, swingtrading does indeed provide enough scope for this... on the other hand, for those of us who do not wish to think too much about which trades to take, the faster pace of daytrading is more suitable... so the decision has much to do with the personality of the trader...

    I have actually made more out of swingtrading in total, but the income flows are considerably more spotty than for daytrading, since the time framework has been expanded manifold... moreover, I get more "pleasure" (a non-quantifiable payment for my work) from running a well designed swingtrading system than from taking intraday gains...
    #15     Jul 15, 2002
  6. Swing trading is a term made up people who were wrong in their stock picks originally....and so "Prayed" the stock would "Schwiiing" back in the right direction.

    There are many ways to make money in this market, and many more ways to lose it...pick what works for you at the time, and adapt to market conditions.....

    once again: "...trading is a simple as you will let it be, or as difficult as you want to make it"...

    #16     Jul 15, 2002
  7. Dotslashfutures, your attempts to discredit daytrading are truly pathetic.

    One of the biggest advantages of daytrading over swing trading is the frequency of trades you get to make. If you are unaware of the impact this trading variable has you are trading blind.

    Also, for a trader with a smaller account, daytrading offers much safer position sizing. The new trader will also be a position to learn much more rapidly from his mistakes than a swing trader. Where it may take a swingtrader 2 weeks to make 10 trades, the daytrader can make them in one day. The daytrader gets 10 more experience than the swingtrader.

    Obviously, if your goal is to compound your returns, swing trades and long term trades will eventually have to be looked at.

    Perhaps the best method would be to combine daytrading and very short term swing trading with longer term trading. This way, the short term stuff provides the income, while the long term stuff build massive wealth. 500,000 compounded at 30% yields nearly 100,000,000 over 20 years.

    To dotslashfutures, yes this more than double the annual return of the SP500. You have stated that this is practically impossible. I submit you don't know what you're talking about. Why is it so inherently difficult to beat an arbitrarily constructed index??
    #17     Jul 15, 2002

  8. I would disagree on the comment regarding new traders... as per my previous comment, I would hazard a guess that, other things being equal, a newbie starting out would have less of a chance of a blow-up swingtrading than daytrading, primarily a function of the necessity to make faster decisions and execute them with precision...

    But once the newbie has learnt the ropes of price dynamics, then of course he can move into daytrading to benefit from greater trade frequency...
    #18     Jul 15, 2002
  9. WOW. You are amazing man! Never heard that before...

    LOL! What a joke. By feeling the need to share such a fundamental trading concept of keeping your emotions out the game, you expose yourself as the greenhorn I always suspected you for. You ought to be banned from making any authoritative comments like "day trading is gambling, there is simply no escaping that fact".
    #19     Jul 15, 2002
  10. But a guess is all it is, isn't it. A fool and his money will be parted no matter what the timeframe.
    #20     Jul 15, 2002