Hi, I've been a full time investor for a few years. Before that I was a high stakes poker player. With the recent volatility I've decided to put some of the trends I've noticed to the test and try my hand at day trading. I've read books by authors who claim to have been trading full time for 20 years or more. So if trading can be consistently profitable like poker (I had a streak of 32 straight winning months) why haven't I heard of more billionaire day traders? It leads me to believe that maybe trends change too quickly for anyone to keep up. Another question for trading veterans. Roughly what % of the markets moves happen intraday? Everyone knows the market tends to go up say 8% annually but is most/all of this movement on the open? If the market does appreciately intraday generally, this alone may be enough reason to day trade since intraday margin is free.
Probably pretty hard to daytrade a billion dollars, but I think a lot of them invest their money into other areas or just get tired of sitting in front of a screen for 8 hours.
1) People have different comfort levels when it comes to their net-worth. Many people are content to "leave the game" after earning "only" 6, 7, 8, or 9-figures. 2) Most, if not all, price movement occurs during the day. There is enough opportunity for everybody, regardless of your time horizon.
If I had several billion, I would set aside a couple billion to manipulate the markets for entertainent purposes for play.
Traderzones, I played professional poker for a living where 95% of players lose. OF course, at the stakes I was playing at about 80% of the players at any given time were winning players. This is because at high stakes the rake of $30/hour or so that the house takes in inconsequential and also because the few "fish" who lose piles of money in short periods of time subsidize everyone else. I've heard that day trading is much the same, where about 80% of traders are losers mainly because of commisions. It doesn't matter to be what % of people lose. The question is whether it's possible to win. The fact that brokerages will hire traders using the brokerages' funds proves it is. I got started in poker by playing as a salaried prop player for a casino. I've made enough playing poker where the commisions even on 10 trades a day is relatively small. A bigger concern for me is the lack of liquidity in the middle of the day in the stocks I trade such as FSLR. I've had to start trading QQQQ and SPY since the alternative is to place 3 or 4 limit orders at various prices constantly adjusting and canceling open orders. The fact that daytrading is more labor intensive compared with long term passive investing could explain the lack of "Warren Buffet" type trades. Then again, the poker players you see on t.v. such as Daniel Negraneu who earn 7 figures every year still play 40 hours because they enjoy it.