Daytrading the SPY or QQQ...?

Originally posted by DayTraderNYC
SPY or QQ is just there to increase my volume. That's enough to lower my rates on everything I do (bullets and regular commission) and increase my payout which would be worth it for me in the end. But , again, I do not want to lose money in the process. As long as I can break even, thats all that matters to me at this time.
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Honestly it sounds like a lot of extra effort to move that much volume for such little reward. Your other strategy will probably suffer at least a little. My first advice would be to see if any other reputable firms would give you the rate you want without all this extra trouble...it can't hurt to ask.

Then if you must do this volume strategy maybe you could use some sort of pairs strategy with QQQ and SPY. Use the standard deviations of the spread range and put on large positions on each side. You could rack up huge volume and be hedged against systematic risk at the same time. Being profitable would take some work...but this was the best idea I could think of.
 
Dustin......GREAT SUGGESTION!
I think between SPY, QQQ and DIA.... I should be able to hedge 2 positions and risk very little....Thanks for the idea dude!!! Im not sure if any other index stocks will work because of lack of voulme..Anyone know of others that I could use?
 
Originally posted by DayTraderNYC
Dustin......GREAT SUGGESTION!
I think between SPY, QQQ and DIA.... I should be able to hedge 2 positions and risk very little....Thanks for the idea dude!!! Im not sure if any other index stocks will work because of lack of voulme..Anyone know of others that I could use?
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Becareful! This sounds like a Texas hedge!!! The indexes are correlated but not all the time. You don't want to be caught with a big "hedged" position when they diverge and go the opposite way.
 
Originally posted by DayTraderNYC
Dustin......GREAT SUGGESTION!
I think between SPY, QQQ and DIA.... I should be able to hedge 2 positions and risk very little....Thanks for the idea dude!!! Im not sure if any other index stocks will work because of lack of voulme..Anyone know of others that I could use?
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DTNYC,

Use the search button (upper right corner) here at EliteTrader to review past messages on SPY or QQQ strategies to see what was previously posted.

I believe what you are looking for has already been discussed..."strategies being used for trading SPY or QQQ".

Nihaba Ashi
 
Originally posted by DayTraderNYC
...As Trader101 mentioned, I have a very very specific method I use profitably everyday. Suffice it to say, Ive been at this for 3 years and make a comfortable living. I very rarely trade the index stocks but have come to realize that I may be able to use it to my advantage because of soemthing that happened at my firm recently (which is not important to post here)...

My money would be made by trading other stocks... my usual method...

As long as I can break even, thats all that matters to me at this time.

Agaion, thanks for the various input - they will all help me.
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DTNYC,

I'm a little confused by the post above by you.

If you ALREADY HAVE PROFITABLE STRATEGIES for trading whatever it is your currently trading...

why don't you test your already proven strategies on SPY or QQQ?

If you have and they don't work well...then I undertand (a little) why your asking your questions as so many others that come to ET.

If you have not tried your current trading methodolgy on SPY and QQQ (what's already working for you and makes you enough money to make a living)...test them first and I highly suggest this to you before you listen to a bunch of anonymous usernames.

Also, I disagree with Trader101 comments that "The fact of the matter, as you already know, is that a very great majority here do not have the answer and do not trade successfully."

I don't know if it's FACT (I'm curious where Trader101 got his/hers stats from)...but I have a feeling that the great majority here realize that their success is based on their experience, intuition, psychology of the markets and psychology of themselves and a little luck...

more weight on psychology of themselves as the tool to profits.

Thus, for a poster to write a few paragraphs of exactly how they do it for profits...Is a little absurb to think their answers will be profitable to you...

especially when you already have a profitable system.

For example, what if someone posted a general answer to compliment your general question about strategies...Answer: "sell or short at overbought...cover or buy at oversold".

Of course such a suggestion will cause more losses than winners and of course they're doing something additional that most likely can't be explained in a few forum threads...let alone in a few paragraphs.

I'm just amazed at how many people come here asking for something that probably requires a mentor (one on one education) and expect to find it among many market veterans that most likely will agree with me than disagree...arguably.

Get a mentor and it'll be money well spent...much better than trading books and much better than answers from usernames.

Note: I'm not saying that mentorship is the best method...just at the top of my list.

Nihaba Ashi
 
i have to say i'm a bit confused too. the thread starts off asking how to trade the qqq,spy...now you're saying you don't care if you make $ or not..you just want it for your volume? why not just up the volume on your current strategy...on your current stox?
I mentioned the hedge in my first post...but why not do more pairs trading.....pro firms have always suggested thats a good way to increase commissions..I mean lower your risk. :)
 
First, the strategies I use for other stocks do not work at all for index stocks. I traded basically news stock at the open. Thats my bread and butter strategy... and Im what you might call a "tape reader". Try reading tape of SPY or QQQ. Simply does not apply.

Why am I interested in increasing my volume? To have my commissions lowered. Why is that so important? Look at the following figures and you'll understand:

If my current commission is 0.0075 (avg daily volume of mininmum 100,000 shares, let's say), that adds up to $750. If the rate goes down to $0.0065, that adds up to $650. $100 x 250 = $25,000 a year. Can I get 0.0065? If my volume is 400,000 a day for a couple of months....Im sure they will consider it. Those are the minimum figures. As my rates go lower, Im sure my volume will increase as well. Perhaps for most of you, commission rate is not important...but it is important enugh for me to consider these strategies. After taxes, this is my second biggest expense to my business.
 
daytradernyc-
i understand what you're saying..and I'm with a pro firm and doing this for a living so I too know the importance of cost. It just seems like a risky strategy for commission savings.
in my experience, trying to make a cut in cost by increasing volume is usually a losing proposition. that why i say, if you have a good strategy...increase that size..or review your trades and maybe you'll find that you leave $ on the table
but if you think using the qqq's will work..maybe you can just envelope them or constantly get on the inside..
good luck.
and as far as 'tape reading" the qqq's etc..yeah I know...sometimes I'll remove the ecn's..they take out some noise...and the spy and dia are a bit slower.

P.S. I just read on another thread that you're at worldco...well my understanding is that unless you have nasdaq clearnce you can't use the ecn's anyway...and in that case i think that increases the risk in this idea even further.
 
"Try www.vtoreport.com They have a strategy there where you buy the QQQ when the NDX 5day RSI goes below 30 and sell when the NDX 5 day goes above 50. This method has a gain of 193% over the last 6 years which is a 12 - 13% compounded annually return. "

If you did it this time you'd be down 20% + right now???
 
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