One of the reasons I like Position Trading

[vetten]

Quote from Buy1Sell2:

Doing just fine! Hope you are as well. ROI in the trading account is typically between 50 and 80 percent yearly although one particular year it was 145%. The trading account represents 20%
of my portfolio. I base my leveraging on my total portfolio, not just the trading account. The rest of the portfolio is spread between cash and mutual funds (I do not trade individual stocks). Recently I was 100% cash in the 80% portfolio and I have started dollar cost averaging back into mutual funds when the daily bullish divergence was forming.( I had sold off the rest of my mutual funds in late April of this year and was totally in cash during the market decline).

hi B1S2
You cant be earning that much on your cash/mutual funds for 80% of your investments.
If you are doing so well with your trading account which average 50-80%, why would you ever want to be in cash or mutual funds for 80% of your total investments? It sure wont be much more time consuming to put a larger trade on or is a bigger postition worrying you?
Is your trading account too risky to be there 100%?

Could you tell me what your average leverage is on your trading account?

thanks

 

[Buy1Sell2]

Quote from vetten:

hi B1S2
You cant be earning that much on your cash/mutual funds for 80% of your investments.
If you are doing so well with your trading account which average 50-80%, why would you ever want to be in cash or mutual funds for 80% of your total investments? It sure wont be much more time consuming to put a larger trade on or is a bigger postition worrying you?
Is your trading account too risky to be there 100%?

Could you tell me what your average leverage is on your trading account?

thanks

Well, the reason that I keep money in mutuals, is to be diversified. If I had it all in the trading account, even I might be tempted to use more margin than I need to. The leverage that I use on the trading account is 5 to1. This equates then to 1 to 1 over the whole portfolio. If I am 5 to 1 on ES or NQ of course, then I need to watch how much I have in mutuals so that I am really not overleveraged since this would be a duplicate.

 

[vetten]

hi B1S2

thank you for your frank reply.

at the moment I am not a day trader, but trading short/medium term.

I would like to invest part of my portfolio in longer time frames of at least 1 year as this is more tax effective.
Here in Oz if I hold over 1 year, half of those profits will be added to my income.
Less than 1 year, full profits added to income.

I understand that your trading positions play out generally over more than 1 year. Do you enter when the trading vehicle is at
year high or do you have a shorter time frame?

thanks for your info

 

[Buy1Sell2]

Quote from vetten:

hi B1S2

thank you for your frank reply.

at the moment I am not a day trader, but trading short/medium term.

I would like to invest part of my portfolio in longer time frames of at least 1 year as this is more tax effective.
Here in Oz if I hold over 1 year, half of those profits will be added to my income.
Less than 1 year, full profits added to income.

I understand that your trading positions play out generally over more than 1 year. Do you enter when the trading vehicle is at
year high or do you have a shorter time frame?

thanks for your info

My trade times are weeks or months, not so much years.

 

[atticus]

Quote from Buy1Sell2:

I recently changed my stance on this. Even though it had been successful for me for a long time, my research of past trades indicated that I would have been more profitable (much more so), by just using my full position right at the beginning of the trade.

100% in agreement. IMO, the only argument for scaling is to reduce market-impact.

 

[vetten]

oh ok B1S2

you`re not much help

thanks

 

[Buy1Sell2]

Quote from atticus:

100% in agreement. IMO, the only argument for scaling is to reduce market-impact.

Yes, I agree. You will generally see scaling done by folks who have too large a position on to leave their screen(ie too large for their account).

 

[Buy1Sell2]

JJ, Osorico and Steve46,

My belief about position/swing versus daytrader is geared towards the fact that newbies and uninitiated traders need to be doing longer term trading first and then once they have had a lot of success, they may wish to turn to daytrading. My argument is not that you can't make money daytrading, rather it is that most people cannot, so why go there first?

 

[cashmoney69]

Quote from Buy1Sell2:

JJ, Osorico and Steve46,

My belief about position/swing versus daytrader is geared towards the fact that newbies and uninitiated traders need to be doing longer term trading first and then once they have had a lot of success, they may wish to turn to daytrading.

I was surprised to see how many "successful" traders tells newbs to learn how to day trade 1st. Their argument is not having the overnight exposure..but I find that to hardly be a problem.

 

[infolode]

All three, the weighting depends on market conditions.

The balance changes constantly but to be honest I've made most of my money over the years through position trading.

Over the last 14 months I've been unwinding very long positions to reduce my exposure.

To date: buy and hold 3%
position 39%
swing 22%
day 7%
cash 29%

I rarely use leverage. Cash is always around 30% for those once in a lifetime opportunities that surface once or twice a year.