How to follow big money?

D

darkray707

If individuals (maybe not if) keep losing money while those guys in Wall streets keep making tremendous amount of money? How can I follow there position?
Recently I participated on the DOM but it didn't help. Because I don't know if it is real until it is filled.

Do ya'll have own filter or rules that might indicate the HFT movement or big money flows?
 
Which guys on Wall Street make big money?
Pretty much none of them can beat the market, so you can do better than 99% of “those guys” by simply holding SPY.

Though your post is too generic. You imagine some “guys”. You don’t know how much they make. You mix HFT with some other guys. You are unable to provide specifics except for imagining that some guys make some big money. While annual reports and statistics about those big money guys don’t support anything that you’re thinking or saying.
If this is how you trade (based on wrong assumptions and imagination) then this may explain why you keep losing money. You need to know every detail of the business you’re in, otherwise focus on a different business that you can fully understand.
 
darkray707 said:
If individuals (maybe not if) keep losing money while those guys in Wall streets keep making tremendous amount of money? How can I follow there position?
Recently I participated on the DOM but it didn't help. Because I don't know if it is real until it is filled.

Do ya'll have own filter or rules that might indicate the HFT movement or big money flows?
More...

Try to understand and analyze the volume. If you can analyze it correctly, you will be able to identify accumulation and distribution places.And it works
I'm not joking.
 
darkray707 said:
So if I follow Deus Ex Trader, will it make more money than those "guys" such as from https://10minutemillionaireinsider.com/top-8-high-frequency-algorithmic-trading-firms/
??
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I don’t know, it’s not finished and may make or lose money. May not be better than anyone else’s auto-trading.

HFT firms you’ve pointed out don’t really make money trading, but many seem to be market makers whose job is to be wholesalers. They don’t take risk and hedge every trade, making small profit form bid/ask spreads. Most other types of HFT firms went out of business as this is a cutthroat business where not many can survive, each blowing millions in investments. A few that are left and still make money, I’m not sure whether they beat the market. There is max capacity and basically making a fraction of a penny per trade wouldn’t make you rich either, without huge investment that you could’ve put into SPY instead.
So for regular people simply investing long-term into an index seems like the best option. Otherwise it can take thousands of hours to achieve decent and repeatable profitability, just from looking at a few successful traders here on ET.
 
darkray707 said:
If individuals (maybe not if) keep losing money while those guys in Wall streets keep making tremendous amount of money? How can I follow there position?
Recently I participated on the DOM but it didn't help. Because I don't know if it is real until it is filled.

Do ya'll have own filter or rules that might indicate the HFT movement or big money flows?
More...
Back in the late 1990s and early 2000s, it was relatively easy to ride on the coattails of large institutional orders. SOES bandits were doing just that. Then towards the mid to late 2000s, there came the ECNs and Dark Pools, along with stealth order routing that allowed you to better hide your orders. That completely changed the market dynamics, which made it nearly impossible to shadow larger players.

So, to answer your question, your time would be better spent finding another strategy than trying to find an edge where there ain't any.
 
schizo said:
Back in the late 1990s and early 2000s, it was relatively easy to ride on the coattails of large institutional orders. SOES bandits were doing just that. Then towards the mid to late 2000s, there came the ECNs and Dark Pools, along with stealth order routing that allowed you to better hide your orders. That completely changed the market dynamics, which made it nearly impossible to shadow larger players.

So, to answer your question, your time would be better spent finding another strategy than trying to find an edge where there ain't any.
More...


This. And I’m not sure whether I understood the original question because following big money is different from trying to make as much money as they do. Most hedge funds have difficulty making 5%/year, except when the market is up 20% or so. So making as much money as “those guys” often means less than everyone else :)
 
guru said:
This. And I’m not sure whether I understood the original question because following big money is different from trying to make as much money as they do. Most hedge funds have difficulty making 5%/year, except when the market is up 20% or so. So making as much money as “those guys” often means less than everyone else :)
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I think he means to "shadow" their moves. That was actually pretty profitable strategy back in the 90s. Not anymore. This is also true for scalping...until the HFT came on the scene.
 
darkray707 said:
If individuals (maybe not if) keep losing money while those guys in Wall streets keep making tremendous amount of money? How can I follow there position?
Recently I participated on the DOM but it didn't help. Because I don't know if it is real until it is filled.

Do ya'll have own filter or rules that might indicate the HFT movement or big money flows?
More...

You're barking up the wrong tree trying to trade intraday noise off the DOM.

The big money buys and sells over days, weeks and months based on changes to the fundamental backdrop (eg interest rates) and medium to long term momentum / sentiment cycles. If you want to follow what the big money is doing, your best bet is to move to a much longer time frame (holding for weeks to months) and apply some basic logic - e.g. by looking to buy the leading stocks or sectors in a bull market, which will get bid up by momo-chasing allocators.
 
Your seeing DayTraders mainly on the DOM getting in and out, big money will be part of it, but no way to tell between big and fish jumping in and out.

Chart Momentum is all you've got and try to ignore the noise.
 
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