Author Topic: Daytraders  (Read 5295 times)

purple monkey

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Daytraders
« on: July 18, 2016, 06:52:28 AM »
I know this might be anti-MMM, but are there any day traders here?

I am considering using Robinhood for the first time as well.

Any experiences to share AS a day trader?

TIA

forummm

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Re: Daytraders
« Reply #1 on: July 18, 2016, 08:53:19 AM »
Just don't do it. You're more likely to lose money than to make money. Spend your effort doing something more profitable (like getting better at your job or finding ways to save money).

Rubic

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Re: Daytraders
« Reply #2 on: July 18, 2016, 09:24:47 AM »
What forummm said.

I've got a relative addicted to day trading.  He lost half his wealth in 2009, in the midst of the Great Recession, but continues to day trade. :(

forummm

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Re: Daytraders
« Reply #3 on: July 18, 2016, 10:08:18 AM »
I'm not a daytrader but finance interests me.  One idea I've been thinking about is if it would be possible to make money by buying low and selling high for something that tends to revert to the mean over time.  Examples: oil, VIX

If it were that obvious, wouldn't someone else already be doing it, and thereby eroding the profits until the marginal gains were equal to the marginal risk being taken on? There are thousands of automated HFTs out there running algorithms trying to take advantage of the markets. Can you beat them? If not, they will take your money.

ysette9

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Re: Daytraders
« Reply #4 on: July 18, 2016, 10:53:21 AM »
It isn't exactly the same, but my father played with IPOs for a while. He is a very risk-loving person and got quite the adrenaline high out of his wins. My mother, the accountant, finally totaled up his wins and losses for him and showed how he was not making money in the big picture. That put an end to that gambling.

If you do want to do this, I'd recommend only doing it with a very small percentage of your portfolio. Keep very accurate total records so you don't fall into the very human trap of discounting the losses and focusing on the wins. Finally, think of this as a game that you pay that costs money. Only gamble the amount that you think is worth losing for the pleasure of the fun you get in exchange.

HeadedWest2029

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Re: Daytraders
« Reply #5 on: July 18, 2016, 10:56:00 AM »
I have Robinhood and love it.  Don't forget about tax efficiency, or lack thereof, with daytrading.  I use Robinhood for the commission free trading for long term tax loss / gain harvesting.  Even if you beat the market your short term gains will be taxed at a higher rate, so you really need to be beating the market soundly.  Not strong odds

Rubic

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Re: Daytraders
« Reply #6 on: July 18, 2016, 11:00:09 AM »
Suggested reading for anyone under the illusion that they're in a level playing field:

    http://www.vanityfair.com/news/2015/03/michael-lewis-flash-boys-one-year-later

kite

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Re: Daytraders
« Reply #7 on: July 18, 2016, 11:11:24 AM »
To make a million through day trading, start with 2 million.........

purple monkey

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Re: Daytraders
« Reply #8 on: July 18, 2016, 11:40:50 AM »
I know this might be anti-MMM, but are there any day traders here?

I am considering using Robinhood for the first time as well.

Any experiences to share AS a day trader?

TIA

mjones1234

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Re: Daytraders
« Reply #9 on: July 18, 2016, 11:57:23 AM »
I would never recommend it as a way to make a full time living. But, it can be a decent side hustle if you know what you're doing. For me, it's no different than a person buying items at deep discount, then putting the item on Craigslist or Ebay. Im just buying equities and being tracked by Uncle Sam. It's taken me many years to get to a point where I know how to cut losses quick and let gains play out. For me, getting through the emotional aspects of it and treating it like business made all the difference. But, I'll be the first to admit that it can be similar to gambling. Only play with what won't hurt you to lose and never let a stock go more than 5% below what you paid.

Altons Bobs

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Re: Daytraders
« Reply #10 on: July 27, 2016, 09:59:44 AM »
At one point in my life, I got a consulting job, and I was waiting at home for a project, but it never came, I was just sitting at home collecting a paycheck.  I got bored so I started daytrading.  It was very emotional.  After losing thousands, I decided that it was time for me to get another job so I wouldn't be sitting at home day trading losing more money than the paychecks that I was collecting.

I would not recommend it.  If you want to do it, you have to know you have to sell before you go use the restroom or take a break or your stock may tank while you're in the restroom.  You cannot be emotional about it if you're doing it.  But don't do it!  :-D

jjcamembert

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Re: Daytraders
« Reply #11 on: July 27, 2016, 10:30:17 AM »
I do not day-trade (the experience sounds awful!) but I do spend a lot of time looking at charts, reading fundamentals, and placing options trades with known probabilities. I try to check the market daily, but I'm not glued to it. Sometimes the underlying will move favorably for my option position and I'll close the trade in a day or so (I've never closed intraday), but most often my positions will be open for weeks. I think most people who just buy-and-hold would consider this day trading, but the IRS does not. I make money but have not beaten the market, especially for any trading that happens in a taxable account. Honestly if I had just bought and held the stocks I researched over the last 5 years I would be a lot wealthier ;)

But I agree with everyone else: don't think you'll ever see or react to the news first, or that you'll be able to trade faster or smarter than anyone else, or that you'll spot a trend that no one else has. Especially if you have a day-job, you need to be comfortable holding a position over a longer period of time.

TheAnonOne

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Re: Daytraders
« Reply #12 on: July 27, 2016, 11:33:35 AM »
If your going to do it, just head to vegas and play some blackjack. Your odds are probably better, and you get some free drinks.

Mother Fussbudget

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Re: Daytraders
« Reply #13 on: July 27, 2016, 11:48:47 AM »
Suggested reading for anyone under the illusion that they're in a level playing field:

    http://www.vanityfair.com/news/2015/03/michael-lewis-flash-boys-one-year-later

Great Article!  Thanks, Rubic,  for sharing the link.

MoonLiteNite

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Re: Daytraders
« Reply #14 on: July 30, 2016, 03:43:35 PM »
Last year i took a shot at it, just a few trades every day.
Some crazy swings that is for sure.
In the end, i have put in 2000, and currently sitting at 6500 after 9 months, and i spent 2000$ on a day trading class from claytrader.

Very very very stressfull and you have be super disciplined and just take the losses when the trade turns against you.
And example, you take a trade that has a 50/50 at going up or down.
If it goes up, it could go up 10%, if it goes down, it could go down 100%.
Now what you do is sell at a 1% loss, no matter what.
If it goes up, above x% you put basically decide how much you want to make at least. Could be 1%, could be 5%, or you could go for the full 10% or just 1% All or almost nothing.
Provided the 50/50 is a true chance, and you do this over and over, you WILL make money. But the 50/50 is not true, so you have to get into trades that are way more in your favor. I think my results for all my trades are actually close to 40% wins and 60% losses, BUT my losses were always small and wins were always bigger.


I currently am winding down off of it though and just started to swing trade stocks that have good trends, and then sell when i see signs of them hitting their top, current one is AMAT.

edit:and nobody should NEVER view day trading as gambling, it is NOT.
It is another way to generate income. Being good at math, and stats is HUGE - it isn't luck.
« Last Edit: July 30, 2016, 03:54:23 PM by MoonLiteNite »

waltworks

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Re: Daytraders
« Reply #15 on: July 30, 2016, 05:16:22 PM »
edit:and nobody should NEVER view day trading as gambling, it is NOT.
It is another way to generate income. Being good at math, and stats is HUGE - it isn't luck.

As someone who was at one point employed as a statistician, I must thank you for a hearty laugh.

-W

arebelspy

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Re: Daytraders
« Reply #16 on: July 30, 2016, 06:22:50 PM »
and nobody should NEVER view day trading as gambling, it is NOT.
It is another way to generate income. Being good at math, and stats is HUGE - it isn't luck.

I couldn't disagree more.  :)
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Rubic

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Re: Daytraders
« Reply #17 on: July 30, 2016, 06:24:40 PM »
edit:and nobody should NEVER view day trading as gambling, it is NOT.
It is another way to generate income. Being good at math, and stats is HUGE - it isn't luck.

As someone who was at one point employed as a statistician, I must thank you for a hearty laugh.


Obligatory comic:  https://xkcd.com/1570/

JAYSLOL

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Re: Daytraders
« Reply #18 on: July 30, 2016, 07:16:36 PM »

edit:and nobody should NEVER view day trading as gambling, it is NOT.
It is another way to generate income. Being good at math, and stats is HUGE - it isn't luck.

It's hard to buy an argument like that when one could easily replace the words "day trading" with "playing poker" or "betting on horse races" and the argument sounds exactly the same.

"Playing poker is another way to generate income.  Being good at math, and stats is HUGE - it isn't luck."

"betting on horse races is another way to generate income.  Being good at math, and stats is HUGE - it isn't luck."

I'm not saying don't do day trading if it's making money for you and you enjoy it, but since it IS a form of gambling, just accept that it is, don't count on it to always make money and enjoy it responsibly like you would poker or horse racing :)

arebelspy

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Re: Daytraders
« Reply #19 on: July 30, 2016, 07:20:07 PM »
Poker actually is skill based.. but the rake is so much that you need to be in such a top %, and most people way over estimate their ability due to the Dunning-Kruger effect.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
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socalteacher

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Re: Daytraders
« Reply #20 on: July 30, 2016, 07:26:57 PM »
I tried Forex trading a few years ago. It was something to do in the summer for fun and I got the "class" for free via a connection. People were paying 2k to take this class. I learned that there are some people who can actually make money doing it but that it is a very small percentage. Of all the people I got to know, only one was able to really be considered successful at it. It was way too stressful for me and too much time staring at a computer trying to hit the best entry or exit.

This past January I did start using my monthly fun money (accumulated sum) to do a little trading on TD Ameritrade. I have stuck to just 5 stocks and I set triggers to buy at very low prices and then triggers to sell at conservative gains. I have been very happy and surprised with the results but not going to quit the day job! Only for fun and only with my fun money that is budgeted for whatever I want to spend it on.

MoonLiteNite

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Re: Daytraders
« Reply #21 on: July 31, 2016, 10:26:07 AM »

edit:and nobody should NEVER view day trading as gambling, it is NOT.

It's hard to buy an argument like that when one could easily replace the words "day trading" with "playing poker" or "betting on horse races" and the argument sounds exactly the same.



Can i facepalm respectfully?
Playing poker is another great way to generate income.
It is largely based on skill and basic math. Yeah "bad luck" (math) can bite you in the butt sometimes, but you control your losses, as you do with day trading, and you come out on top.

You just have to learn how to do it, and not play based on "feelings" and "luck, but rather play based on math and your brain.

I have made over 20k playing poker in the last 10 years. (would have been higher but yay US government once again!)
« Last Edit: July 31, 2016, 10:28:57 AM by MoonLiteNite »

slowsynapse

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Re: Daytraders
« Reply #22 on: July 31, 2016, 01:06:13 PM »
I have day and short term traded in a past job, albeit many years ago.  I have day traded my own account and executed trades for other day trading groups and individuals who were using all sorts of systems.  My experience in day trading falls mainly in currency and commodity futures.  It is a very tough game where educators and system sellers probably make more money than 99.9% of people trading.  I could probably answer all types of detailed questions on the subject.  I will not argue for doing it or not doing, just say buyer beware.

Shor

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Re: Daytraders
« Reply #23 on: July 31, 2016, 01:12:53 PM »
Woke up one morning up $2k on unsecured puts.
Tried to sell, unable to sell. Oh No! Call in! Dialing.. waiting.. waiting... Waiting... talking talking... okay problem fixed.. market corrected and I made a 'mere' $100..
and now I'm late for work too... Think of excuses, think think.. "I'm late because... I made more in an hour than I make here in 2 weeks.. and then lost it all in 2 minutes.. so here I am!"

JAYSLOL

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Re: Daytraders
« Reply #24 on: August 01, 2016, 12:05:18 PM »

edit:and nobody should NEVER view day trading as gambling, it is NOT.

It's hard to buy an argument like that when one could easily replace the words "day trading" with "playing poker" or "betting on horse races" and the argument sounds exactly the same.



Can i facepalm respectfully?
Playing poker is another great way to generate income.
It is largely based on skill and basic math. Yeah "bad luck" (math) can bite you in the butt sometimes, but you control your losses, as you do with day trading, and you come out on top.

You just have to learn how to do it, and not play based on "feelings" and "luck, but rather play based on math and your brain.

I have made over 20k playing poker in the last 10 years. (would have been higher but yay US government once again!)

Exactly, for both poker and day trading, if it's something you can make some money at with some natural skill, math and lots of self-control then go for it.  As long as you don't count on the income/get in too deep, and just generally accept it for what it is - gambling it's nothing to facepalm about.  Trouble only arrises when you start needing to play (or trade) because you start counting on the income (from debts or lifestyle inflation, which is where it falls apart for many people when they start getting good at a form of gambling), or start treating it like a job or a legitimate investment vehicle that you will depend on later, or letting it become an addiction

waltworks

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Re: Daytraders
« Reply #25 on: August 01, 2016, 03:41:01 PM »
Even if you're very good at poker, you're almost certainly going to make more money working a real job where your math/analytical skills are in demand. If it's just something you enjoy, then great. You made $2k/year. But it's not worth mentioning in the grand scheme of anyone's personal finances.

But I agree, poker has far superior odds, and enough skill involved, that a skilled and disciplined player can make money at it. Stock market, meh, not so much. The level of competition is orders of magnitude higher, and the majority of the other players aren't amateurs doing it for entertainment.

-Walt