I am sure both schools are profitable. However, I am curious statistically which school is more profitable. Value investors like to cite Warren Buffett as an example why value investing is superior. They ask "If shorter-term trading is so profitable, why are there no prominent ultra-rich traders who can compare with Warren Buffett"?
I have been pondering over this question. Is shorter-term trading inferior to value investing mainly because it is not as scalable as value investing? What are the pros and cons of each approach?
I think you have thrown a wide open question and crossed several aspects of trading and/or lack of partial knowledge of Buffett. It wasn't until like last year I always thought Buffett was greatest long term trader around until
MY interests of trading gone different direction. I think Buffett can be considered one of the best options sellers around to make shorter term durations while using the underlying as the hedge/capital appreciation. It is my believe he is making very more consistent returns on the options than the stocks which where the stock market keeps making higher highs could be thought as a way to limit down side.
MHO, greatest number of wealthy commodity traders happened in late 1970s/80s was due to extremes and great movement in many commodities and the likes of Dennis, Trout, Rogers and dozens of traders became very wealthy, and cause of brokerage fees in stocks was more of a buy and hold style. But starting in 1990s, cheaper brokerage allowed guy at home, some of walls came down. Think there are more Commodity billionaires today than before because advent of Hedge funds and shows how automation can become an ATM.
www.cnn.com/2013/04/15/business/commodity-traders-250bn-harvest/index.html
I would like to believe in my heart that "make America Great again" would and could become again. I would like to see more Buffets' of owning businesses besides those just doing hedge funds as if more companies make an effort to start more businesses, business would come back to the states again.
I am sensing much more diversification of durations because those who are larger are making side companies for brokerage, larger hedge funds are making them. It really difficult to push in one million shares of anything at decent price and still be able to do options with the stocks, whereas owning a brokerage, can hide it more.
In my case, short term stocks or commodities the risk is the same, so I might as well get for longer durations, but dance shorter 2-12 month duration options around my positions. I think there are much less entrepreneurs who can trade funds and be able to manage people in other companies like those of Buffet, Icahn.
But let's face it, the number of years to get good and do it from home will be getting tougher, you can make a very decent living, doesn't matter which one you trade so long as you are consistent, what is difference if you net 200% in either one as long as you net the same. One of major problems with many of the pits closed is reduction of networking with those who might back an up and starter. It was much easier to learn spreading in the pits than at home, and spread trading was and is very consistent way to trade. You want to know where good areas to learn more about the markets? Look to see where there is absence of books written on some topics. Those who know-don't write books on it.
Playing the game is about thinking smart, don't waste you time trying to re-invent the wheel, and when you do know how to play, you will always think "that's it"? But I spent years trying to make it harder, keep it cheap-2% risk max, long term think in terms of 15 to 1 profit to loss min and short term concentrate on low losing percentages, if you not losing often, account more likely to go up and have confidence to add more shares/contracts.
