Daytrading becomes more difficult because of algorithmic trading?

I have seen the market for tick scalping go from stupidly-lucrative to desert. (5 years?)
I have seen the market for option selling go from 'like farming wheat' planting/harvesting to (again...) desert. (5 years?)
I have revisited one of my oldest interests -- Ye Ol' Trend-Following rules. (EOD, FWIW.) I have assembled an algo, and am implementing. I expect it to be *joyously* simple and productive, until the market no longer "comports" to my trading method.

We have to match our trading method to the market regime in front of us, and adapt as that regime changes, as it will. If the market and the trading method do not match up, do not expect success.
 
tommcginnis said:
We have to match our trading method to the market regime in front of us, and adapt as that regime changes, as it will.
More...

artforgame-gamedesign-whack-a-mole-2.jpg
 
very few big guys develop their own algo's - and the guys who develope the algo's - do so with building counter algo's in mind to prey off the algo they sold. only traders who are self performing everything in house are killing it continually. until they get a wild hair and get into some other business and lose it all.
 
I remembered first trade I took in stocks was 100 shares of IBM and commission was $125 in 1978. And in mid 80s first commodity trade was $40, stayed that way till 1990 to $25 and $12.50 in '95, but fees in stocks where coming down in 90s faster like 5,000 for $5 bucks with Brown I think if willing to do limits. Fees for day trading futures are way too high and futures have been watered down in value hugely in S&Ps from $500 a point to $50 in ES to get retail to be suckered into them imagining they be the 1 in a 1,000 and playing golf at 10am and pay higher fees. So when you think an exchange is doing something to benefit small trader, think again, they guppies in a pool of sharks as it should be. Knowledge and dedicated work is everything.

Stay playing the game long enough, you adapt much quicker, after awhile you don't notice anything being different, maybe little frustration for 3 minutes and adapt, I hardly remember if market went up or down by the close any more. But do love playing the stats and watching the work put into this be correct.
 
digitalnomad said:
Manually? What's your average holding time?
More...


It depends totally on the market which is not within our control.
It could be

few seconds as what happened to last Friday India Nifty futures,

or few minutes as happened to NQ market during today US session,

or few hours as what happened to GBP during today Eur session.
 
digitalnomad said:
@maxinger
Digitalnamald you
Unless your trading penny stocks at second to minute timeframes, you're definitely bothered by algos. Maybe you just don't realize it :)
More...
Digitalnamald, u must be mad with some one

I don't trade stocks. I trade futures. And I don't use time based candles.
 
Last edited:
prj said:
I'm going into day trading, it looks like it makes sense, there're some working patterns, but I hear sometimes that it's getting harder because of robots, patterns work worse. As a day trader do you feel the same?
More...
no

prj said:
For how long there're still money?
More...
as long as the market stay open, the commissions stay relatively low, the spread stay relatively tight, and the public keep investing in markets
 
Of course technological progress makes it harder for mom and pop day traders to win:

Here is an excerpt from a 2010 letter from the most successful day trading firm, Shoenfeld, to it’s fully fully trained and fully backed traders before it fired most of them:

"unfortunately, our vision of the future of trading has changed. It is getting much tougher for traders to make a living or get by.

The direct competition from black boxes, stat arb and high frequency trading which continues to grow at exponential rates is here to stay and has caused us to change our outlook for lesser skilled traders."

11 pros I know from 15 years ago all became losers and have stopped, even though some had made millions.

I will not say there are no highly successful pros, but many of those who crush are highly automated and incredibly skilled.

  • stay away from gurus-for-hire as mostly they now have no edge and no longer win, or they never did.
  • Try to hook up with real winning day traders on a personal level. Maybe you will not be able to do this, but this should be your goal.
 
You must log in or register to reply here.
Back
Top