Buy The Close....Sell The Open $$$

There are a few ways to trade :

1. spend a very long time (like 8 hours / day ) glueing your backside to the trading chair
and eyes to the computer screens

2. listen to professional writers who appear to have done some analysis. Then just trade the closing & opening.
Spend about 10 minutes at closing and 10 minutes at opening every day and
hope that tons and tons of money will just fall from the sky.


3. Because #1 involves staring at the screens for so long, automate the trading.

What we know of trading is that there is simply no shortcut to reaching
financial freedom.
 
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Yes I ran a test from 1993, buying close, selling open, with $1 per trade commission. That's where I got the 4.5% yearly return. I didn't compare with buying open, selling close though.

Trader200K said:
Sometime back I read an academic research report basically saying all the market risk premium came before/after hours. Seemed incredible to me with the volume differences. Individual session change moves can get impressive as heck, but I have yet to run across any strategy with any real predictive power to benefit from them.

Curious to see if I could verify this claim from a direct, boots in the mud perspective, I built a quick daily bar strategy in TradeStation that simply computed performance of buying at each Close and selling at the next day’s open. After trying it over numerous timeframes, I couldn’t confirm any numbers with that huge degree of after-hours advantage. Maybe I screwed something up, but it’s pretty straight forward computation.

Anyone else run this test with results that match the first graph above?
More...
 
maxinger said:
1. spend a very long time (like 8 hours / day ) glueing your backside to the trading chair
and eyes to the computer screens
More...

Not sure why you keep believing that trading profitably means staring at the screen/charts for 8 hours or more per day.

Some day-trading systems require no more than 10 to 15 minutes of screen time per day.
 
Tradex said:
What do you mean?
More...

I think it is important for traders to spend lots of time to develop their own holy grail / trade plan.
We are all different. What works for one person may not work for another person.
One thing for sure; it is hard work and there is no shortcut.
 
maxinger said:
I think it is important for traders to spend lots of time to develop their own holy grail
More...

Yes, searching for the holy grail could take an entire lifetime.

This is by far the most time-consuming activity, as far as trading is concerned.
 
If you did this in 2020 - you'd be up 79 ES points excluding commissions and assuming you'd actually get filled on the Close/Open. You'd have to endure a 808,75 point drawdown. That's more than 40K on 1 ES contract.

A quick study, so I'll stand corrected if there's anything wrong.

upload_2020-9-29_16-59-22.png
 
I also did backtest on equities, non-edge exists anymore if there was any. the gain is $0.002/share, which can not cover commissions, let alone the dd is huge.
 
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