You won't get rich daytrading - my story

lol.. i can just imagine Hitman leaning back in his chair watching his 12 monitors, while simultaneously monitoring cnbc, cnnfn, bloomberg and of course his live feed from the futures pit.. not to mention his instinet terminal.. man, it must be nice to trade with a big firm =)

-qwik

 

Qwik:

A 9 month small potato trader don't get quite as much benefits I have 4 monitors, CNBC, CNNFN, our team was supposed to get a Bloomberg but a guy who used to work with us somehow magically transferred to his name when he moved to another branch! Instinet and Squawk Box for the pit are for more senior guys.

Wet:

I never said you can't make money swing trading IB + Quote Tracker, but in day trading it is a quick way to go broke

 

Well I just finished reading Tradermike and all the threads relating to you'll fail if you DayTrade. Yes he is right about most newbies failing. I am a newbie and I am not doing very well. I guess he generated a good argument and ruffled everyones feathers.
But there is one thing lacking...something we all want to know. Why? Why? Why do most fail and lose a lot of money. Sure you can generate a laundry list: Use stops, money management, risk/reward and on and on and on! Sure you can debate between long term, short term, swing trade, daytrade.
But, what is the real answer?
I come to this web site to learn. When the senior members of this site talk.....I listen! When any other member who has good advise talks.....I listen!
My guess is that the real secret to Daytrading, SwingTrading or any other kind of Trading is knowlege...the more you know, the better prepared you are. The knowledge that I have gained here has helped me....but, I need to learn more...much more. I learned something from TaderMikes debate!
Money talks....and I AM SICK AND TIRED OF IT! If I ever become a successful trader, I promise to tell all how its done. I'll gladly teach anyone for free and help every aspiring trader, swingtrader, long term investor that has a thirst for knowledge and a will to succeed. I am sick and tired of money, money, money.
I know that the members of this site are not greedy. I know that the members of this site are not after MONEY! The members of this site are here to help one another. How do they help?........WITH KNOWLEDGE!
So come on guys I need all the help I can get!
I am listening!
VINIGAR

 

Bill,

I agree with pretty much everything, except for the quoted part. If I say "0.50% risk" I mean 0.50% of my portfolio. So if that port is 10K, then I risk 50 bucks. True, in the 10 dollar example the stop is 2.5%, but not of my cash. I still risk only 50 dollars, I just buy enough shares so that the 50 dollars represents the 2.5% stop in the position. So it's not 5 times the 1/2% rule the original poster was using. I took the poster to mean 1/2% of his capital is risked in any position.

But I agree that while position sizing is terribly important, many make it seem as if 1/2% position sizing assures the same risk if you divide all your capital into 5 trades at 1/2% risked each or put all your capital into 1 trade risking 1/2%.

As you noted, there's always the chance of disaster, and if all your cash is in one spot, then 1/2% risked isn't going to matter much. Better to spread the risk out, and THEN use 1/2% risk per position. While Van Tharp's book is very good at convincing you that position sizing is extremely important, I think he does not stress specific stock risk, and so perpetrates the misunderstanding you highlight (no offense, Robert).

Wet

 

Sniper,
If he is hyping his site in the guise of his debate...I am not falling for it....and neither are you! I am not going to his web site and pay him or anyone else. I am here to learn all I can from experienced successful traders. I want to learn DAYTRADING, thats what I care about. Not SwingTrading or Mikes way of doing things. If he is hyping his site here...I don't like it as much as you don't.

 

This is extraordinary. Thank god for sniper because I thought I was going crazy. Initially while gazing upon Tradermike's opening post I know I saw--"It's free". Upon receiving news of replies I went back into the thread and walla--It's gone. I was shocked as I was not aware one could return to posts and edit. It's clear Tradermike saw fit to remove the line promptly. I believe Tradermike underestimated us all and came into this site as an advertisement-- and was not well received. I don't know- he could have the best system in the world but trying to trick us is offensive and insulting- and improper use of the site. I think he received, his as they say, his "just deserts".

 

Huby said:
"It seems to me that you are trying to accomplish one of two things. 1) Hype your website. or 2) Create a controversial thread just for fun. If number two was your goal, then you certainly accomlished it. Congratulations. I hope you got your jollies off of it. "

Controvesy, but not confrontation. I've been in many confrontations over the stock market on the internet. Most of them come from short selling campaigns that I've been involved with. Boiler room companies hate me. But in those cases there is nothing wrong with confrontation as I am dealing with outrageous criminals and crooks who should be put in jail. A place like here is a community of good people trying to help each other out. My intention was to create a thread that would be controversial enough to get people thinking. To talk about some of the truths about trading that are too often ignored. My intention wasn't just to boast, but to point out some of my own shortcomings that I have learned from. Things people will have to deal with no matter what style or time frame they may trade. I am sure everyone can relate to some of the things that I wrote in the first post, but no one wants to admit it.

 

Hitman:
"Here is my experience with swing trading, I don't think it is any easier than day trading because I did it back in 2000 and honestly I couldn't get anywhere with it. Am I going to say you can't make money in swing trading? Of course not. I tried it, it wasn't for me, I got chopped up and broke even after six months, I tried day trading, and I said "you know I like to work with this time frame", that was it. "

In what ways did you find swingtrading more challenging than daytrading or how is daytrading easier for you than swingtrading. I had the opposite experience. Would be curious what you have to say here.

 

VVV said:

"one thing i have to agree with however is that when daytrading, and never mind the risk of ruin etc for the momement, you cannot achieve geometric growth of your capital due to liquidity etc considerations...

marty schwartz from "pit bull" fame may achieve something like a couple hundred percent return p.a., but he does not geometrically grow his capital, ie he takes out his profits and starts fresh each year... "

That is the point I was trying to make with the title. Not that someone can't make money daytrading - a few can - but that know one can get rich daytrading because you can only use but a limited amount of money doing it because of liquidity considerations and the fact that you can only daytrade but so many stocks at once. Unless you are going to pile into the QQQ or something. And that isn't going to make you a fortune.

Get a list of the richest people in the world. George Soros and Warren Buffett are on the list. Some hedge fund managers are probably just off of it. But knowhere will you find a daytrader on the list.

Someone can make a good living if they are successful at daytrading. But the stock market ranks people by the % return they do on their capital and the elite there are not in the fraternity of daytraders.

To put it another way. You can get into the big leagues daytrading, but you can't make it to the All-Star game. You need more tricks to do that.