It would be worse.
there is no career in trading - quote
- Thread starter edward22245
- Start date
It would be worse.
If capturing inefficiency is bad, reductio ad absurdum, the best market would be maximally inefficient. In other words, one where prices are completely random and unanchored from any fundamentals. Obviously this can't be correct. Actually I would say it's the opposite - capturing inefficiency is the point of participating in a market, and the best market is maximally efficient.
I would also dispute the idea that trading is zero sum. As you mentioned in another post, there are interactions with the real economy. If financial market prices are not efficient then resources will not be allocated optimally in the real economy.
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LBJ said part of it[From The Pit to The PC book ]
ALLmost all of it right, but his book was mostly day
trading which by definition would make that true.
But most money is made by longer time frames, so you may want to inVest sometimes\not as much in a down trending bear.......... LBJ did graduate to longer time frames later on.
I would have to strongly disagree,
The most, possible, money is made by the highest number of revolutions, or trades, you can do....magnified by leverage, options.
If you can generate a certain % in a day....versus waiting weeks, or months, or years....imagine that ....an investor or swing trader is playing with Sparkers, while someone doing it on a daily scale with leverage, is refining plutonium for a nuclear bomb.
Make a million dollar Turtle,
I agree trading isn’t zero sum in that a liquid market inflates asset prices and that incentivizes real capital to be invested. It is largely zero sum in that there is a winner and a loser as real wealth isn’t produced (like building an airplane or providing a real service). It’s value is a secondary derivative.
Do you want the sum of your productive life to be a minnow in that phenomenon?
obviously there’s no right answer. It’s all based on our own value system and full disclosure I’m struggling with it myself.
%%I would have to strongly disagree,
The most, possible, money is made by the highest number of revolutions, or trades, you can do....magnified by leverage, options.
If you can generate a certain % in a day....versus waiting weeks, or months, or years....imagine that ....an investor or swing trader is playing with Sparkers, while someone doing it on a daily scale with leverage, is refining plutonium for a nuclear bomb.
Make a million dollar Turtle,
SURE; in some cases.
But my point was made because n mostt millionaires in stock market are made by buying every month for 40 year s or more; or market making/specialist$ like you hinted.
Even some of the best trading funds[James simons.... are dwarfed by sheer numbeof long only funds /% fees on AUM, i think ; but have not really done all the math on this last one\LOL
]Correction: Thieves do not make money. They take money from others without authorization so of course they don't produce anything. But traders are not thieves. If they are considered thieves, then so are the countless investors in mutual funds and etc. cuz they are all traders just in longer term.
No you have it backwards. It's zero-sum within the context of a specific transaction within a specific point or duration of time. In the long run over a period of time, byproducts of trading are produced for the benefit of all so real products with real value are actually produced and real wealth are produced because people actually buy the products that are produced by trading. This is what the majority of people fail or refuse to understand and/or acknowledge.
Everybody's productive life is a minnow if you want to define it the way you do. But by aggregation, the work that we do, the contribution we make culminate to the grand scheme of things. That's how it is with every single profession no matter how "big" including being a country's leader.
In my mind, there is no difference in "prestigiousness" between jobs. The job of a garbage collector is just as prestigious as the leader of a country. The only difference is in their function.
What products are produced by financial trading? I don't understand your first part of the post.
There's a difference between a garbage collector who can see his value by keeping a community clean and a trader who front ran a pension fund that was accumulating a stock so that they could sell it to that pension fund 10 ticks higher (but created liquidity in the process).
Real investors own assets for their cashflow where the current price is the present value of that cashflow. It's very different than a trader who is looking for a change in price.