"Although I only read through his initial message, the poster made no mention of a methodology. Where is his edge? All he said was that he makes high probability plays --that's not a methodology. It's like me saying that I only make trades that make money." I donât have a methodology, I have a thought process. On the trade on the Qâs, if I see the volume on the ask drop from 20,000+ to 0, I believe it is very probable the bid will move up to the next price level. If it happens twice in a row, I think it is probable it will happen a 3rd time . When it started to do the same thing a 3rd time I bought calls. To my way of thinking it makes sense to buy something as it is going up in value, especially after it had been driven down to low levels. Now, if I had said that I had bought 10 calls at $30 and sold them at $275, no one would think anything about it because thinking small and cautious seems to be the name of the game for many here. If I had said that I bought them 2 weeks before when they were at $160 and had lost my money when I cashed out of them at $20, no-one would question that because after all 90% are losers right? But because I took a small amount of my IRA -$50,000 and set it aside to gamble with, gambled and won, you think Iâm full of shit. As I said before in my opinion it is all gambling, just with different amounts of $.
After reading this Q's trade post a second time, I realized I had been trading options on the Q's at that time. I looked at my records and I had bought calls at $130, $60, $40 and $25. Then on the day the market ran up I sold everything I had when I broke even on the trade. Then I went back to my system of going contrarian after 3 and 5 day runs and loaded up on puts. What a smuck. I lost $3,000 on the puts and and missed one of the best bull runs up to that time. I remember seeing an order for 500 calls on the OEX execute right after I bought puts on the Q's. Should have followed that boy instead, I think those calls finished about $3-4,000 in the money. Nice call Tom.
did not say 1% are winners. Said less than 1% are big winners - meaning longterm, can easily live off your winnings If you are 1 year then you are not there yet, and we only have your claim. Post your big winning account statements, otherwise you are irrelevant.
"I remember seeing an order for 500 calls on the OEX execute right after I bought puts on the Q's. Should have followed that boy instead, I think those calls finished about $3-4,000 in the money. Well hopefully he didn't post that trade here on ET, they would still be laughing at him. Funny, I'm sure most posters here have read the usual books on trading -Market Wizards, Livermore etc... Got psyched to pull $ out of the markets, then laugh at people who take the same risks the icons in those books did.
Making one or a few trades per year works for fundamental traders like Jim Rogers. Not my thing, but I like to keep an eye out for those rare opportunities. e.g. if Oats hit 100 again I'm going to load up the boat and average down if it goes lower etc.
"Most traders are losers primarily because they don't cut their losses short." I've had this discussion before so won't repeat it. I'll just say that if you are trading options, which often have a spread of 10% or more, and don't buy at the exact low point, your option will more than likely get stopped out at a loss even if the trade is an evantual winner. Buying options 2-3 months out means you will see them go up and down, sometimes 50% a day. Hard to use small loss stops on them.
Dontcha just love these idiots who claim not to be either traders or investors and yet have the balls to lecture to other traders that their "gut feeling" is far superior to any system? This surely demands a standing ovation...and another round of applause. Bravo! Encore! Oh, by the way, I too bought Goldman Sachs, Citi, and BOA on the day they hit the bottom! I will continue to buy everything when it hits the bottom. Just don't expect me to tell ya until long after the fact!!
This thread has certainly caught the attention of many of us here and inspired a lot of responses in a short time! I agree that trading is relatively easy, as ways of making money go. Unfortunately, it's also very easy to lose money if you trade with borrowed money, borrowed shares, or terminal contracts. That's why I never trade on margin or take outright short positions or trade options. If I'm right, I'm a trader. If I'm wrong, I'm a buy and holder. Either way, you can't lose.