Discussion in 'Trading' started by areyoukidding?, Oct 4, 2005.
I welcome the comments on this.
YOu mean 'working' for the buy-side or sell-side? If I got your terminology right it's obvious sell-side is better
Why do you think working for the sell-side is better landboy? I would never work a sell-side job....
(I think the original poster is getting his terminology confused -- "Buy Side" and "Sell Side" typically refer to firms who are either asset allocators (buy side) or servicing investors/deals/corporations, i.e., investment banks (sell side) -- I'm guessing the original poster meant, why is it safer to buy a stock than sell it short)
It wasn't that great in 2002, or at least most of 2002. Overall in history the markets go up so people feel safer on the buy side. Now if you are talking intraday, then each day is different.
Thats what im trying to get to. Why is there a natural predilection to buying whereas only traders want to sell short?
Lets really open this up for discussion. I am bored today. market off 8 pts, <yawn>.
The "buy first" mentality is one of the hardest things to teach our traders to overcome. The market is guaranteed to go up AND down each day...so if you limit yourself to only buying first, then you cut your opportunities in half.
In pairs trading, we always do the sell short side (harder side) first, and if we can buy the same stock back with a profit, great, if we can't then, and only then do we buy the other stock ("crutch pairs trading").
From the investing world, this is almost as bad as the "buy and hold" stupidity of the last decade. Reading "Blood in the Streets" - and it goes into detail about how a generation of investor's were duped into doing so.
I was at a prop firm recently and 80% of the traders played the long side in a momentum like fashion. I couldnt figure it out. Even the principals endorsed this way of trading. It was nuts.
The Long side is much easier because there is a *powerful* bias for it from the Gummint on down through the individual's psyche. The Powers will mislead, lie, manipulate and cheat in attempts to force the market up or stop a decline.... none of that for the shorts.