This makes me chuckle. I have the same issue. I buy these shit companies a number of them mysterious ones out of China like IDEX that are most likely a house of cards but hey they bounce around with incredible juicy high implied volatility and I can cost base them down to close to zero buy selling inflated calls and entering after being assigned on selling a juicy put that they end up being good winners. I'd never put these turds in my IRA account (buy and hold) but from a trading set up they work. Ever read the quarterly filings for turds like IDEX and MARK their a shit show and will all end up on Hindenberg Report. Maybe it's a bunch of Robinhooders pumping these things up but an opportunity is an opportunity.
An Attempt to Learn How to Trade Consistently and Profitably
- Thread starter attempt
- Start date
LOL
that is not healthy.
i have seen sensex go up for months without a healthy correction but who are we to tell the market what to do
that word is key...trading but in trading who ever mentions healthy corrections
i feel like I could grab a quarter behind your ear, and you’d be amazed and befuddled every single time lol
Look dude, everyone has to start somewhere and I understand that the SPY is your thing because you find so much information about it.
You have to understand, though, that chances of making money with your setup are close to zero since you pay retail commission, you don't have the full orderbook in real time and you don't have direct market access. I also wonder why you are not subject to the pattern day trading rule that prevents you from intraday trading with an account less than 25k.
But let's say you want to be stubborn and stay on that route, forget about your plan, it's worthless at this stage of the game anyways. I mean what would you even write on it when you don't know what works and what doesn't???
Journal each and every day!
Prepare a template that contains the following subjects (this is only for the SPY. Adjust for your market of choice)
1. Big Picture: Copy/paste the daily chart here with major support/resistance
2. News: What are todays headlines?
3. Corresponding Markets: Write down the performance of USDJPY, Gold futures, ESTX50 and NIKKEI225, Oil Futures, 10y Notes and Copper futures. A simple +0,5%, -0.8% and so on is enough. Use futures, because they trade 23/7 and cover the Asia session.
4. Biggest index components: Performance of the 10 biggest stocks premarket
5. Since you are trading a derivative, note down the average premium/discount to NAV of the previous day (you were watching, right?). Also note the basis of the ES over index
6. Volatility: Note the 25d risk reversal(skew) and the 25d butterfly(otm vs. atm) both in IV. Second, note the 1-3m ATM calendar and the 3-6m ATM calendar, both in IV again.
7. Your trading plan for THAT particular day
8. Daily review of your trades
9. Potential ideas for tomorrow.
You do this every single day for at least a year and you will notice a drastic improvement in your results. The biggest problem in trading is the fact that you will never meet the same conditions ever. So practise is very difficult as you cannot just throw 50 3 pointers in a row. You may throw one, the next opportunity is in two weeks...so you somehow need to get repetitions under your belt. A journal accomplishes that.
Discipline is measured by how you do your daily journal not by adhering to some magical rules you took off the internet. If you slack, you'll never learn. This is the meat of your trading business and I still journal every day. Keep doing this and you will always find ways to make money.
I have a cash account and options clear T+1 or overnight. That is how I overcome PDT.
Can you go more indepth on (5) and (6) or point me to some resources. Honestly I do not know much about options and I will start learning about them more indepth starting today.
Thanks I'll do both video and textbook. I plan on doing a bit everyday if I can, so it might take some time to watch all the videos and read the book. But nonetheless I'll attempt to day trade with a single put/call everyday, even if I am in the dark about some of the market mechanics.
Ok, cash account makes sense, so it's mostly long only, right?
5.) https://www.etf.com/etf-education-c...s-the-creationredemption-mechanism?nopaging=1
Keeping an eye on premium/discount to NAV gives you insight into the authorised participants actions.
Second, the ES basis is basically the same.
Since it is not a delta one product it's kept in line by basis traders.
Looking at the basis gives you a feel for the move. E.g. market up/basis wide -> rally is futures driven. If top ten stocks don't move but the ES rallies while basis widens, you can be pretty sure that basis traders will hammer the ES back down.
6.) the 25 delta risk reversal shows you how much otm puts cost vs otm calls, e.g. are people buying protection?
25d fly shows you pricing of ATM vs OTM and timespreads give you an idea of urgency, e.g. when people are rushing for protection they mostly buy short dated puts since they have the most gamma and are cheap on a nominal basis
Start learning about ETFs first. I still find it mind boggling how many people trade these and still have no clue how they work. Do your homework, start with the basics.
After that, get the book by Pierino Ursone (https://www.pierinoursone.com/). It requires basic understranding but it explains the relationships best
5.) https://www.etf.com/etf-education-c...s-the-creationredemption-mechanism?nopaging=1
Keeping an eye on premium/discount to NAV gives you insight into the authorised participants actions.
Second, the ES basis is basically the same.
Since it is not a delta one product it's kept in line by basis traders.
Looking at the basis gives you a feel for the move. E.g. market up/basis wide -> rally is futures driven. If top ten stocks don't move but the ES rallies while basis widens, you can be pretty sure that basis traders will hammer the ES back down.
6.) the 25 delta risk reversal shows you how much otm puts cost vs otm calls, e.g. are people buying protection?
25d fly shows you pricing of ATM vs OTM and timespreads give you an idea of urgency, e.g. when people are rushing for protection they mostly buy short dated puts since they have the most gamma and are cheap on a nominal basis
Start learning about ETFs first. I still find it mind boggling how many people trade these and still have no clue how they work. Do your homework, start with the basics.
After that, get the book by Pierino Ursone (https://www.pierinoursone.com/). It requires basic understranding but it explains the relationships best