The switch from investor to day trading

[nizar]

An Investor seems to be chasing perceived bargains, whereas a Trader is concerned with defending a position.

Interesting point.

Last week somebody at work asked me about how i trade. I told her i like to buy stocks when they are at their MOST EXPENSIVE. And she was like shocked and like "oh, wow, thats an interesting theory" and probably thought in the back of her head (i wonder how much this fool has lost so far). And i said well it is contrary to what most people think - but most people dont make money from trading stocks.

And then i explained about blue skies and volumes and when to sell. It took a few minutes and then i said to her it really is that simple. And then she said the classical line: Oh, but i could never put my money somewhere without knowing everything about the company.

And then i thought - time to get back to work.

3: Keep your position sizes within YOUR COMFORT ZONE --very important.

Position sizing (money management) and proficient use of stops (risk management) are both very important.

For me personally, sometimes my position sizes are a 1/3 or 1/2 of my initial capital (because i use fixed fractional position sizing and really like tight stops)

I think in general position sizing is an overlooked part of the trading plan.

 

[theasxgorilla]

I think in general position sizing is an overlooked part of the trading plan.

Agreed, usually in favour of technical (over) analysis.

 

[Bobby]

I have made the change (or in the process) and im very happy with the progress and results so far.

Learn to be selective. Your system may bring up many buy signals a day. If they dont exactly meet your criteria, walk away. Dont be tempted to buy everything that moves.


.

Hello Nizar,

I guess your now set up with live data & scanner.

Like to hear your recommendations & reasons regarding this.

Cheers Bob.

 

[nizar]

Hello Nizar,

I guess your now set up with live data & scanner.

Actually no.
Though i really really should.

Im going on holidays 2nite overseas for a few weeks, when i get back i will get some equipment.

Im not going to spend several Gs though, my account is not big enough to make such a spend practical.

 

[It's Snake Pliskin]

Im not going to spend several Gs though, my account is not big enough to make such a spend practical.

You can trade CFD's and take advantage of THEIR money.

THOUGH UNDERSTAND YOUR RISK.

 

[Bobby]

Actually no.
Though i really really should.

Im going on holidays 2nite overseas for a few weeks, when i get back i will get some equipment.

Im not going to spend several Gs though, my account is not big enough to make such a spend practical.

Looked into this some time back, costs little if your good with putors !
I'm not, but can show the way when you get back.

Cheers Bob.

 

[tech/a]

Dont think position sizing within your comfort zone can be over stated.

On price of trading tools.
Watching some of the "trades" and profits made in the "Fundamental shares" thread 3k on equipment for pretty well all those there should be a drop in the ocean.

I'm not understanding the contradiction.

There are trades of 100-200% made with regular monotony or so it appears.
Even a $2000 position will have the software and data paid for in a few trades.
A $5000 position and one trade will have it all paid for with change!

Hell if good software places you in the position to trade even a few a month why wouldnt you race out and get it!

If you cant afford good software you cant afford to trade! (Ive said that before).

Using it to the best advantage is another matter I suppose.

 

[ezyTrader]

nizar,

Commsec platinum platform is available for professional traders. 47 trades or 1 option, in a quarter (3 months), and the subscription is free.

Better than nothing, I reckon.

I'm at the stage of reading more books than you can chew (swamped is the other word) before I decide if daytrading is the game for me. So far, the market's been kind to me...I must say...

 

[Bobby]

I'm not understanding the contradiction.


Using it to the best advantage is another matter I suppose.

Tech those two points are worth considering, the cost of setting up with live feed & scanning ability is pertinent for those who find using this software difficult.

Sure you get a trial period with most, but that may not be enough time to get your head around how it all works before you need to pay up.

I know you use Marketcast , they charge some $bucks for their trial.
Yes its cheap it you know how to use it.

How easy is it to use comprehensively ?

Also good to see you posting again.

Bob.

 

[constable]

The switch from investor to day trading

I have been contemplating making the switch from investor to trader.
To make the move I will have to cash in about 30% of my current holdings to raise capital keeping the remaining 70% for long term stock.
On the capital I will have for short term trade I figure I will need to make a return of minimum of 2% a week (averaged out over 1 year).
One of the main reasons for making the change will be for tax advantages.
Has anybody else made the change and if so what problems have you come across or tips of the trade do you have?
Thanks

Vic , whatever you do , join a gym or better yet get a home gym.
One thing i found is that sitting in front of the computer for 6 hrs tends to pack on the weight!
Wouldn't hurt also to set up your desk and computer as far away from the fridge as possible! lol (mine is about 5m , no where near enuff)
Anyrate get those endorphins flowing, healthy body healthy mind.

 

[tech/a]

Tech those two points are worth considering, the cost of setting up with live feed & scanning ability is pertinent for those who find using this software difficult.

Sure you get a trial period with most, but that may not be enough time to get your head around how it all works before you need to pay up.

I know you use Marketcast , they charge some $bucks for their trial.
Yes its cheap it you know how to use it.

How easy is it to use comprehensively ?

Also good to see you posting again.

Bob.

Bob.

If it interests me I'll post. But gone are the days of "Teaching" so to speak.

I had Marketcast for a couple of years before I used it for shorter term trading.
I get a 50% tax deduction.
Im no Software genius Im a builder not an I/T based person---everything is self taught.
If I can use it anyone can.
Marketcast is $165/mth and around $400 setup.

Really in the scheme of things not big $$s. For a student---yes--- but students without a capital base shouldnt be trading---learning yes--trading---there is a time and place for everything---not the time.

You hear all the time dont confuse brilliance with a Bullmarket---well Ive seen some very very lucky and very very silly trades/decisions by people in the Fundamental section of this forum.

A lot of hope and could be,would have,should do on the next announcement analysis.

Its in plain veiw anyone can drop in and watch. Simply an observation.
So how costly is the right gear????

 

[Bobby]

Bob.

If it interests me I'll post. But gone are the days of "Teaching" so to speak.

I had Marketcast for a couple of years before I used it for shorter term trading.
I get a 50% tax deduction.
Im no Software genius Im a builder not an I/T based person---everything is self taught.
If I can use it anyone can.
Marketcast is $165/mth and around $400 setup.

Really in the scheme of things not big $$s. For a student---yes--- but students without a capital base shouldnt be trading---learning yes--trading---there is a time and place for everything---not the time.

You hear all the time dont confuse brilliance with a Bullmarket---well Ive seen some very very lucky and very very silly trades/decisions by people in the Fundamental section of this forum.

A lot of hope and could be,would have,should do on the next announcement analysis.

Its in plain veiw anyone can drop in and watch. Simply an observation.
So how costly is the right gear????

Tech I've quoted your entire post, before I comment you777
are a mix of idioyn'crasy thats you !

 

[It's Snake Pliskin]

Last week somebody at work asked me about how i trade. I told her i like to buy stocks when they are at their MOST EXPENSIVE. And she was like shocked and like "oh, wow, thats an interesting theory" and probably thought in the back of her head (i wonder how much this fool has lost so far). And i said well it is contrary to what most people think - but most people dont make money from trading stocks.

And then i explained about blue skies and volumes and when to sell. It took a few minutes and then i said to her it really is that simple. And then she said the classical line: Oh, but i could never put my money somewhere without knowing everything about the company.

Nizar,

I don't talk to non investors/traders anymore. They always know more and display sheep mentality with a touch of "might be able to think but can't" attitude. They all know more than me and that is the way I like it.

 

[wayneL]

Nizar,

I don't talk to non investors/traders anymore. They always know more and display sheep mentality with a touch of "might be able to think but can't" attitude. They all know more than me and that is the way I like it.

I think thats the best way.

"They" don't like what I have to say anyway... and they blame people like us for their losses

 

[It's Snake Pliskin]

I think thats the best way.

"They" don't like what I have to say anyway... and they blame people like us for their losses

Exactly.
Everytime there is a downturn they say "how much did you lose?"
Answer: "nothing."
Result: Sheep stare.

 

[Bearman52]

Exactly.
Everytime there is a downturn they say "how much did you lose?"
Answer: "nothing."
Result: Sheep stare.

hI sNAKE
IT CONFUSES THEM EVEN MORE WHEN YOU'VE SHORTED STOCKS OR FUTURES AND MADE A BUNDLE IN A FALLING MARKET
LOVE IT
BM