If you hold overnight positions/swing trade, how do you hedge against gaps up/down?

[Visaria]

Quote from oldtime:



who are the traders making a living full time that do not need and use margin?

Ok, you have a point. I think of margin sort of differently in that I nominally fund my trading.

 

[oldtime]

Quote from oldtime:

no, only anecdotal

would be interesting to see the difference between options and just getting flat on the close

just because you are flat doesn't mean you aren't swinging, you can put it right back on on the open

both tactics are too expensive for me

 

[oldtime]

Quote from oldtime:

both tactics are too expensive for me

actually, I employ the most expensive (when it comes to opportunity costs)

I trade small enough that a gap is just another bump in the road

I expect them, endure them and half the time enjoy them.

 

[oldtime]

Quote from Visaria:

Ok, you have a point. I think of margin sort of differently in that I nominally fund my trading.

sometimes I think the only difference between trading and investing is margin

the investor uses his hard earned money

the trader goes out and borrows to fund his crazy ideas

 

[syswizard]

Quote from oldtime:

would be interesting to see the difference between options and just getting flat on the close

You're right...that would be quite an analysis. Since Futures Options historic pricing is likely either not available or mucho expensive, doing this with an IB test account would be the way to go.

 

[007Arb]

Quote from oldtime:

sometimes I think the only difference between trading and investing is margin

the investor uses his hard earned money

the trader goes out and borrows to fund his crazy ideas

I don't believe in margin unless you are just starting out and have a four figure account. According to you I am an investor, even more so if I told you I only trade open end equity/bond funds. This year (a typical trading year) I will make about 500-600 trades spread among three accounts. I am almost daily increasing/decreasing/moving to the best relative strength funds etc., but I would hardly categorize my style as that of an investor.

 

[oldtime]

Quote from 007Arb:

I don't believe in margin unless you are just starting out and have a four figure account. According to you I am an investor, even more so if I told you I only trade open end equity/bond funds. This year (a typical trading year) I will make about 500-600 trades spread among three accounts. I am almost daily increasing/decreasing/moving to the best relative strength funds etc., but I would hardly categorize my style as that of an investor.

so what is your average annual return?

 

[007Arb]

Quote from oldtime:

so what is your average annual return?

Unlike when I had a smaller account, average annual return is meaningless to me now. As your account *compounds* over the long haul it obviously takes a smaller and smaller annualized return to generate a large dollar return. One of the perks of getting older and being in the game a long time.

 

[oldtime]

Quote from 007Arb:

Unlike when I had a smaller account, average annual return is meaningless to me now. As your account *compounds* over the long haul it obviously takes a smaller and smaller annualized return to generate a large dollar return. One of the perks of getting older and being in the game a long time.

yeah well, we weren't talking about old men getting older, we were talking about young men supporting a wife and children

My guess is you had a real job, so when it comes to trading for a living you don't really know what you are talking about

but congratulations for managing the money the company paid you well

 

[007Arb]

Quote from oldtime:

yeah well, we weren't talking about old men getting older, we were talking about young men supporting a wife and children

My guess is you had a real job, so when it comes to trading for a living you don't really know what you are talking about

but congratulations for managing the money the company paid you well

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