Anybody day trading C Citi?

azzzy · Jan 15, 2009

I'm new to trading and still learning. I was wondering if anybody was day trading Citi these past couple of days? How did you figure your entry/exit points? Or was it more of a gamble? I paper traded it (on a demo) and made out pretty good, but I feel like there was no real strategy. I think I was lucky and I don't know if I would dare to do this with real money. Edumacate me please about your methods when it comes to Citi and the like.

Thanks much.

KINGOFSHORTS · Jan 15, 2009

NO!, Trading in C shares could be halted at any moment, sudden downward spin and boom halt in trading.

C shareholders likely to become insolvent.

Paper trading is not the same as real trading. Paper trading is like playing poker by yourself.

When you trade in real life you put your hand out there and other traders will see your hand, and they will trade against you. So its different.

If you are going to learn how to trade. Go practice trading 2 lots of PG

my7tvette · Jan 15, 2009

I agree with king; C is a poor choice for a new trader due to the unpredictable news factor. The only redeeming quality is that there are many other bank stocks that you might be able to hedge yourself with if you are stuck in a position with news pending.

why are you using a sub-$5 stock? if the reason is to be able to put on a larger position share-wise, i would look for a cheap stock in a sector that is a bit less newsy, maybe utils or something.

whatever stock you choose, you might want to find a peer stock or two in the same industry group to keep an eye on as well.

At any rate, good luck in your trading journey. I'm glad you are keeping your "tuition" low right now by paper trading, but until there is some $$ on the line, even a small amount, you won't really get a great feel for what trading is going to be like. just my opinion, others here may disagree.

azzzy · Jan 15, 2009

Quote from KINGOFSHORTS:

NO!, Trading in C shares could be halted at any moment, sudden downward spin and boom halt in trading.

C shareholders likely to become insolvent.

What do you mean? They can just stop trading in a middle of the day? Is that even legal? Do the shares become worth $0 in an instant? How does this work?

Quote from KINGOFSHORTS:

When you trade in real life you put your hand out there and other traders will see your hand, and they will trade against you.

Not sure whether this applies to my situation - I use market orders, and even if I used limit, the sheer volume traded of C shares probably would make my measly 5000 shares virtually invisible/unnoticable.

Quote from KINGOFSHORTS:

If you are going to learn how to trade. Go practice trading 2 lots of PG

Why PG? Are you being sarcastic or is it a genuine advice? I just looked at the chart and it seems to be going up and down a lot without a long enough trend to make it worth trying.

azzzy · Jan 15, 2009

Quote from my7tvette:

why are you using a sub-$5 stock? if the reason is to be able to put on a larger position share-wise, i would look for a cheap stock in a sector that is a bit less newsy, maybe utils or something.

Cheaper stocks require shorter movement to produce more profit (or loss). Most cheap stocks don't move as much as expensive stocks but C has almost as much movement as something costing $50, only each cent is 10 times the money. In other words you need shorter trends to make the same amount of money. And the volume let's you not worry that there's somebody to catch you when you want to exit.

my7tvette · Jan 15, 2009

azz, you are exactly right. with cheap stocks, you can load up on larger positions, thus exacerbating the loss when you are wrong. Plan on being wrong for awhile. a lot. So the positive reason you give for trading C (huge percentage moves) actually works to your detriment when you are just starting out. Remember you are trying to keep your tuition low, thats why you are paper trading, right?

Anyway, as to your question about trading being halted, yes, trading in stocks can be halted if big news is pending. No, it usually doesn't mean that when trading resumes, stock will be at $0....but will it feel any better if C reopens at $.25 if you are caught long with 5000 shares? Of course, maybe you will be on the right side of the trade when trading resumes, but then, you are talking about a coin flip now, which goes back to your original question. The answer: Yes, trading C is a lot like throwing coins in a slot machine.

azzzy · Jan 16, 2009

Quote from my7tvette:

Anyway, as to your question about trading being halted, yes, trading in stocks can be halted if big news is pending.

I am curious how does this usually happen? Is there an anouncement from the broker? A warning saying the trading will be halted in 5 minutes? 1 minute? Or is there no anouncement. You just trying to place a trade and it doesn't happen?

Quote from my7tvette:

The answer: Yes, trading C is a lot like throwing coins in a slot machine.

Thanks. That was pretty much the essence of my question.

So nobody is day trading C? Nobody at all?

my7tvette · Jan 16, 2009

Not sure how exactly the process goes with stocks being halted, but it happens when big news like mergers, bk's etc are coming out during trading hours. I had it happen when I was a newbie one time on DIS while I was in a position. They were scheduled to report earnings after the close, and news leaked prior to market close. the stock was halted for 15 mins. or so until the company made an unscheduled early release of earnings. You can cancel your pending orders and put in new orders, but nothing is filled until trading resumes, typically at prices far from where stock was previously trading.

This is obviously not an everyday occurence, so no point in stressing about it, but I think Kings point is that there is a lot of news surrounding C and the banking sector in general right now, so trading it can be very treacherous for a new trader.

BTW, I used to trade C along with JPM and BAC quite a bit. Not so much intraday anymore. You see the volume, obviously these are among the most heavily traded nyse stocks, so somebody is trading them. I just think if you are trying to learn, maybe picking something that has some volatility, but not so much news, might be a better way to go. 'nuff said. Anyway, again, good luck with your trading.