what size can be day traded?

Discussion in 'Trading' started by chipper, Apr 7, 2008.

  1. chipper


    I see many day traders trade quite small accounts. Not knocking it. Not at all especially if you can make great % returns..

    But is it possible to day trade stocks with millions?

    What's the limit before you get screwed on slippage/liquidity?

    Thank you
  2. depends on your timeframe and the stocks you trade but basically there's no problem playing millions in the high volume blue chips.

    Without going into specifics ie limits, your fill can be complete in seconds. But you need to be clever in where and when and make sure your position is less than 10% of a very low daily volume over the last six months.
  3. It is not the size of your account that counts. It is the size of your balls.
  4. [​IMG]
  5. yes it's very easy to trade with millions. millions isn't that much.

    limit depends on the stock and liquidity situation. there is no definite answer.
  6. chipper


    ok...so with a stock like Google you could easily trade into many millions daily with it?

    When do you become a red flag for the MM's, etc.? What size do you start attracting attention of the stop hitters, etc?

    Thank you
  7. there are loads of stocks you can sink $20m into in seconds when the market is busy. Forget MM/stop hunters - get your trades right.

    If you are wrong it's not the MM or stop hitters - it's you. If it was a low liquidity stock you might have to watch the axe, but in big liquidity just get the direction correct.

    There are no excuses.

    And yes the MM will see any block trade and know who it comes from, just don't read too much into that. LevII games are few and far between.
  8. Very little to do with actual dollars involved, more a matter of shares and the individual stock liquidity. Virtually all the stocks we trade you can go with 2,000 shares ($15 or $80 stock price, doesn't really matter). With GE and others like it, 8,000 is not a problem.


  9. NazSpaz


    LOLOLOLOLOL! :D :D That is probably one of the funniest lines on ET! And yet so true! :D
  10. You can work this out for yourself very easily. My suggestion is look at the daily volume over the last 6 months and don't exceed 10% of the lowest daily volume over that period. That should keep you safe as far as liquidity is concerned.

    The bigger the volume the faster the fill. If you push it you'll find it can take hours to work your trade. The $ amount you want to trade divided by the price tells you how much you can buy within this liquidity rule of thumb.

    From what you ask, you'd be much better to talk to Don about a trading arrangement; I'm sure he'd have various options for you. I think on your own you'd be a lamb to the slaughter.
    #10     Apr 7, 2008