Playing the market Long-Only.

Quote from Fast_Trader:

Do you think one can be successful playing the market long-only? I have a friend who wants to start trading with $15K initial capital, and wants to do it from his cash-only account. That way he's not restricted by the pdt-rule. Do you guys think one can be successful going long-only? Even in a bear market, there are always gainers.

Thanks for any info. :)

Later.
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It was done all the time in the bull market. It can be done now, but it is harder.
 
Quote from Fast_Trader:

Do you think one can be successful playing the market long-only? I have a friend who wants to start trading with $15K initial capital, and wants to do it from his cash-only account. That way he's not restricted by the pdt-rule. Do you guys think one can be successful going long-only? Even in a bear market, there are always gainers.

Thanks for any info. :)

Later.
More...
Yes, as long as you realize that when one instrument is going down, there is another that is almomst certainly going up. If by long only you mean long only in one instrument, you are handicapping yourself immensely, IMHO.

nitro
 
Quote from Fast_Trader:

Btw, does any broker allow you to short from a cash-account, but only up to your cash limit? So, he could short $15K worth of stock only.
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no, you need a margin account to short.

yes, you can make money long only.
and yes you can make money long only even if you only play stocks.


(not all stocks move with the general market. check out NTES last year! :))


there are futures markets that move independantly of the stock market, but, imho, $15k isn't enough to trade them.
 
Your friend has a far better chance of making money if he only trades from the long side but the big question is how will he allocate his funds?

If he's trading stocks then he cant afford to place more than 10% of his capital in any one share. Why not tell him to trade one s&p mini from the long side only, he'll probably find it easier.
 
Quote from klutz:

Your friend has a far better chance of making money if he only trades from the long side but the big question is how will he allocate his funds?

If he's trading stocks then he cant afford to place more than 10% of his capital in any one share. Why not tell him to trade one s&p mini from the long side only, he'll probably find it easier.
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Given your point, which I believe is accurate, I'll restate that he should look at single stock futures.
 
Quote from Fast_Trader:

Do you think one can be successful playing the market long-only? I have a friend who wants to start trading with $15K initial capital, and wants to do it from his cash-only account. That way he's not restricted by the pdt-rule. Do you guys think one can be successful going long-only? Even in a bear market, there are always gainers.

Thanks for any info. :)

Later.
More...

Of course you can. Unless the market is going on a straight line to zero. Look at the volatility that occurred in the past two weeks on the long side. Any countertrend trader was probably long on either the 12th or 13th and captured part of the ride. Also dip buyers throughout last week captured part of the move. If anything shortsellers playing "the trend" down were crushed last week. <P>
More importantly, pick a method, and TEST it. No excuses for losing money if you don't test your ideas before trading.
 
I can't believe peoples' responses so far.

Anyone with an ounce of brain power can see that you would be playing the part of a fool if you only go long and never short.
This is like driving a car and only ever making right turns...HELLOOOOOO. The issue is not 'can it be done', obviously it can. The issue is, IS IT WISE.

Anyway,
The original decision to go long only was predicated on the idea that by having a cash account you can get around the PDT rules...NOT SO.

Not understanding PDT, margin, these very basic things leads me to believe that your friend ought to be trading VERY small when he starts out, less than 100 shares. Not only that, he should be reading a lot more books first and get his account to 30k for trading stocks.

Bottom line he needs to make himself aware of the possible options he has...going long only to avoid PDT (and going long only period) is not the correct or wise option.
 
Quote from Fast_Trader:

Do you think one can be successful playing the market long-only? I have a friend who wants to start trading with $15K initial capital, and wants to do it from his cash-only account. That way he's not restricted by the pdt-rule. Do you guys think one can be successful going long-only? Even in a bear market, there are always gainers.

Thanks for any info. :)

Later.
More...

Statistically speaking you have a better chance of having winning trades going long than short... thats a fact...
 
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