Do you have to day trade to trade full time?

shortlist said:

For me it's the purist part that concerns me. I am not doubting the efficiency and usefulness of TA in any way. For private traders without access to high level information TA is our way of fighting back and making profitable trades.

I'm just making the case that in my limited knowledge you bring other things to a chart when you read it. You understand broadly what's going on with copper, or you know what's going to happen when Tehran switches to calculating its oil fund value in euros rather than dollars (which happened a couple of days ago). This information must be able to assist any technical analysis you choose to execute? Only a purist could disagree, no?

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Going too far off topic here for my liking. There are countless threads debating TA vs FA, please move to one of them.

Lets keep this discussion to "do you have to daytrade to trade full time?"

To tech

Something tech said earlier about swinging the odds in my favour - I've been thinking about that tech. Are you talking about swinging the odds in your favour by purely technical means? The analysis of volume and moving averages, ascending triangles, double bottoms, and strategic technical or percentage stops, etc. In your opinion, are technical methods the only way of swinging the odds?

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Theory and practice are poles apart.
As I read your and others musings I can personally relate to it all.Experience and application in my own trading has me clearly seeing where your coming from and even clearer I see where you have to go.

Like Nick I'm happy to wager any amount on your "technical hypothesis" and I wont be punting!
My/our expectancy is nicely positive---in the wager.

Pretty well 100% of my trades the only thing I know about the company is its code.The ONLY reason I'm trading it is the technicals.

So in my opinion trading purely technically makes trading terribly simple.
Sure you can be profitable trading without technicals but would argue only in bull markets.
Yes I can and have made $$s in bear markets even though I dont trade short!
Purely because I'm to slack to set up a CFD account for that purpose.
Should just short the index or SPI can do that with IB (sorry waffling).

prawn_86 said:

Going too far off topic here for my liking. There are countless threads debating TA vs FA, please move to one of them.

Lets keep this discussion to "do you have to daytrade to trade full time?"

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Amen to that, Prawn.

tech/a said:

Theory and practice are poles apart.
As I read your and others musings I can personally relate to it all.Experience and application in my own trading has me clearly seeing where your coming from and even clearer I see where you have to go.

Like Nick I'm happy to wager any amount on your "technical hypothesis" and I wont be punting!
My/our expectancy is nicely positive---in the wager.

Pretty well 100% of my trades the only thing I know about the company is its code.The ONLY reason I'm trading it is the technicals.

So in my opinion trading purely technically makes trading terribly simple.
Sure you can be profitable trading without technicals but would argue only in bull markets.
Yes I can and have made $$s in bear markets even though I dont trade short!
Purely because I'm to slack to set up a CFD account for that purpose.
Should just short the index or SPI can do that with IB (sorry waffling).

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Gday tech

Following prawn's advice, I'll swing this round to day trading and follow up your post at the same time. You say you make $$ in a bear market without shorting - so am I right in saying that you do this by making use of TA and very short timescales? For example, a stock could be on a general downward trend - consistent with a fundamental analysis of that stock's value to the market at any given time, but you make your $$ in short-term retracements on a day-trade basis or over a few days with information provided solely by TA?

tech/a said:

Sound business is to place yourself in front of demand,and remove yourself from markets which display little or no demand.(In of course the timeframe in which you do business.)

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People should take note of this post. Imo thats what trading is all about. Frontrunning demand to an extent.

fundamental analysis is deciding which footy match u r gona go to on the weekend ---

technical analysis is putting your bet on a minute before kickoff --- its all about timing the market !

skyQuake said:

People should take note of this post. Imo thats what trading is all about. Frontrunning demand to an extent.

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Its not that hard.

First table is before open
Last table is a couple of minutes ago.
Analysis time 20 mins To set stops and place a few orders in line.

This should answer a few questions.Re Can it be done?
Yeh I'm at my day job!

shortlist said:

I could develop an interest in trading on this timescale, but for now I want to keep my risk amounts small and I also want to avoid leverage, so I am looking at longer time frames until I understand the process better.

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shortlist,

trading on 1min is small risk amounts and low leverage. on IB I get 45:1 or 50:1 depending on what they deem right at the time.

don't be fooled in thinking short term trading is all about high leverage

Depends what you want to do i guess, what are your strategies what style suits you. are you going to scalp? or buy "undervalued" stocks and keep them for the medium term, or you may have strategies which have you in a stock for short term say 20 days or something.

If your scalping you do need to be infront of the screen 24/5 but a full time trader can spend 2 hours looking at stocks of interest and researching new stocks to see whats setting up.

Set up alerts and then go do your thing. when they set up according to your strategies you enter your trade. you def dont have to sit in front of your comp gor 8 hours a day to be profitable.

lukeaye said:

Depends what you want to do i guess, what are your strategies what style suits you. are you going to scalp? or buy "undervalued" stocks and keep them for the medium term, or you may have strategies which have you in a stock for short term say 20 days or something.

If your scalping you do need to be infront of the screen 24/5 but a full time trader can spend 2 hours looking at stocks of interest and researching new stocks to see whats setting up.

Set up alerts and then go do your thing. when they set up according to your strategies you enter your trade. you def dont have to sit in front of your comp gor 8 hours a day to be profitable.

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Good question. I'm a full time 'investor' but still watch the screen for most of the day/my night. Obviously not in the same way a TH... I might as well go to bed at 7.30 every night (your 10.30am).

I sit and watch the markets nearly all day as well, but im saying you dont have to, to be succesful.
I cant change my stock positions at 11.30 at night when wall street opens, but i like to watch the activity anyway

tech/a said:

If I thought it was punting I wouldnt be trading.
A consistently advancing equity curve and a known blueprint to follow shows to me that my business of trading is successful due to sound business management not punting.

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If we define punting as gambling, then we are punting. I've seen you state before that you don't gamble, but that's hard to argue since the definition of gambling is to place a stake on an uncertain outcome. The difference is not whether or not you are gambling, but whether you are gambling with a positive expectation, or a negative expectation.

Julia said:

Mr J, you've made a lot of very authoritative statements in this thread.

As I recall your earlier comments a couple of months ago (ish) you conceded that you hadn't at that stage actually done any real trading with real money.

Are you able to share with us whether that is still the case?

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Any statement I make is an opinion. It may be fact, it may not be fact. That said, if I state something as fact, I believe it as fact, and it usually is fact.

Not true. I have been trading since I started posting here, and by now I have more screen time than most people here who don't day-trade.

Of course. Almost everything I've discussed in this thread relies on theory (i.e. knowledge), not market experience. I am experienced in related fields, and much of the theory carries over. Some here don't recognise this, but that is their problem, not mine.

wayneL said:

1/ Is a casino patron punting? Why?

2/ Is the casino punting? Why?

The answers to these questions will give an insight into whether a pure chart trader is punting.

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Both are gambling. Whether or not an individual agrees depends on whether they use the correct definition of gambling, or the popular definition. I won't argue this any further, as most people refuse to look the word up in the dictionary. I may look at it this way because I come from a gambling background, while many traders will want to distance themselves from the negative connotation of gambling. In the end it doesn't really matter, as long as the trader understands the underlying mathematics.

shortlist said:

And yes, tech, I find pure chartism slightly unsettling

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Is it because you think of charts as magical, squiggley lines? Think of charting as the study of movement of price. Now consider that trading is an action that has the goal of capturing price movement. A chart is simply a visual representation of price movement. The movement is caused by the market, which is made up of people. People do not act randomly, and are often predictable and with emotion. Therefore, a chart is just a visual representation of this non-random, often predictable and emotional action.

Timmy said:

Stick around & you will hear many TAs bemoaning price moves that 'shouldn't' be happening/'shouldn't' have happened.

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It depends why they are saying this. It may be an emotional reaction to a trade that didn't work out, it may be a result of placing too much confidence in T/A (it's about probability, not certainty), or it may be a comment on irregular market movement, i.e. manipulation.

lukeaye said:

If your scalping you do need to be infront of the screen 24/5 but a full time trader can spend 2 hours looking at stocks of interest and researching new stocks to see whats setting up.

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Was that a typo? If not, then why would you think that? It will vary greatly between traders, even if they operate on the same timeframe.

I sit and watch the markets nearly all day as well, but im saying you dont have to, to be succesful.

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Definitely agree with this.

Set up alerts and then go do your thing

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Also with this. I've started doing this after being realising I am too easily distracted from trading.

Mr J said:

It depends why they are saying this.

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What "depends why they are saying this"?

Mr J said:

Both are gambling. Whether or not an individual agrees depends on whether they use the correct definition of gambling, or the popular definition. I won't argue this any further, as most people refuse to look the word up in the dictionary. I may look at it this way because I come from a gambling background, while many traders will want to distance themselves from the negative connotation of gambling. In the end it doesn't really matter, as long as the trader understands the underlying mathematics.

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I knew some pompous pedant would come along with this argument.

If we are going to be pedantic about the definition of gambling, then every mercantile endeavour is a gamble. But TBH, I think you are confusing taking a gamble with taking risk.

gam⋅ble  [gam-buhl] Show IPA verb, -bled, -bling, noun
Use gamble in a Sentence
–verb (used without object)
1. to play at any game of chance for money or other stakes.
2. to stake or risk money, or anything of value, on the outcome of something involving chance: to gamble on a toss of the dice.
–verb (used with object)
3. to lose or squander by betting (usually fol. by away): He gambled all his hard-earned money away in one night.
4. to wager or risk (money or something else of value): to gamble one's freedom.
5. to take a chance on; venture; risk: I'm gambling that our new store will be a success.
–noun
6. any matter or thing involving risk or hazardous uncertainty.
7. a venture in a game of chance for stakes, esp. for high stakes.


I think you will find however, that providers of gambling entertainment have somewhat predictable outcomes. This is how they can list as public companies and have their shares valued.

Likewise, my risk adjusted returns have been pretty much in a narrow range since I started trading full time.

Pompous pedants will insist that is still gambling. Those more sensible will relax the need for semantic purity and go with the context intended.

Mr J said:

I won't argue this any further, as most people refuse to look the word up in the dictionary

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Its semantics.

Refer to the section "Other forms of gambling"

Mazza

Just let me know when your having your next pool party will you.
If that collection of Honeys you keep displaying are at your place I'm there!

tech/a said:

Mazza

Just let me know when your having your next pool party will you.
If that collection of Honeys you keep displaying are at your place I'm there!

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lol, you're always welcome tech!
But I cannot guarantee I can maintain the quality, IOW your decision to attend would be gambling
BUT wait - there is positive expectancy...

Timmy said:

What "depends why they are saying this"?

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There are different reasons someone would suggest that a movement should not have occured, and some could be legitimate.

wayneL said:

If we are going to be pedantic about the definition of gambling, then every mercantile endeavour is a gamble. But TBH, I think you are confusing taking a gamble with taking risk.

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It's not pedantic, it's accurate, and you're the one furthering the discussion. I don't bother going more than one post into this topic because I know the argument never ends. Like I said in the previous post, ultimately what matters is that the trader understands the underlying mathematics, even if they don't acknowledge it as gambling.

No, I'm not confusing risk and gambling. In your post, it is clearly stated that gambling is placing a stake on an uncertain outcome. This can be interpreted to include any action we take, but in even its most literal sense it still includes trading.

Mazzatelli, there's no use pointing to a wiki page regarding this topic. Wiki is hardly a definitive source, and gambling is a widely misunderstood term and topic. Like I've said though, I'm not going to go further into it. There is no reward in this never-ending argument, and I only bother to point it out once.

I suppose Tabcorp is a gambler too then.

I didny say all traders, but i know of many traders who only spend 2 hours trading a day, and still have posisitve results.

once again depends on what you want to do. i know with options trading, i spend far less time then i do with my cfd trades. It differes with everyone is what im trying to say.

but like anything the more time and effort you put into something the better results you get. perfect practice makes perfect. of course if your doing the wrong thing the more time you spend the more you will lose, thus why i say perfect practice.

PS. off topic is anyone who is holding longs, as scared as i am that if wall street doesnt break 9860 tonight its gonna roll?