Trading with $500,000.00

Quote from TM_Direct:

Yes...Im still trying to figure out who would win a race between a midget and a pig:D

In all seriousness though, This is not a serious problem...also, I will bet anything there is a follow up link from some "new poster" who will have a hedgefund, book or some other thing for sale that will miraculously appear....I'll keep quiet from here on and watch...but it's always the same. By the way do you know Harry?
in a search of posts it seems you tend to post when he does...maybe coincidence though.
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And, I thought I was the suspicious one... :)
 
What I have to do in this story :)

Quote from patrickpope:

This is really tiresome TM. Shall we drop it ?

I've got no idea who Harry123 is. I once posted to a thread started by Harrytrader. Perhaps you have a conspiracy theory about that too ?
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I can assure you that I am a regualar at home trader if you will...with no other motive than to hear the thoughts of others regarding the topic. There is no salesman pitch coming nothing more than a simple thank you for those who reply.

For those who ask why would one ask another for adivce..if that person has xyz amount of money...well good question. One, I can assume that there are people who are in a similar situation as I am and they have found a solution...Two for those who are not in this situation I wanted to open a thread to discuss and let them be aware of a trading dilemma rarely ever discussed. I respect the input of all those who reply and I never would I think that because someone may have less money than I do currently that their advice is worthless..so to flip that coin around pleae dont feel that your adivce is worthless to give if you do have less money...I assure you what you have to say is helpful. Also for those who are trading with less money it is helpful for me to hear from you because I would assume that you are trading your money more efficiently than I am currently and I would like to know if you feel that the future would be a problem for you if you continue to increase your account size or have you made a contigency plan for that.

Now to get on with some more things that need clarification..I have seen a couple of replies stating to buy a house...I would like to say that I have done that already. For the one person who asked why I posted the amount I'm trading, instead of saying a large sum...I felt that the absloute number was needed because a large sum varies from person to person and thus would negate the whole point of this thread. However I appreicate the point being brought up its a good obersvation.

So far the replies have leaned toward...account diversication for different trading techinques...(via day trading and swing)...financial instrument diversication (trading futures, currencies, interest rate swaps, along with equities). These suggestions are all very good and will help me to generate plenty of new ideas to battle this problem. Pleaes keep the responses coming thank you again.
 
Quote from Runningbear:


If you decided to never commit more than 50% of your capital to the long side of the market and no more than 50% to the short side, you may be a little bit more comfortable using all your capital.

Of course this may result in less total trading opportunities, however if your daytrading, you will still be getting plenty coming your way.
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Runningbear brings up an interesting point-- the catastrophic event scenario, e.g. nuke in NY, 9/11 part 2, etc. It's highly unlikely (maybe not), yet it is something that all should consider.

What are some ways of hedging against such an event? RB already mentioned never comitting more than 50% of capital to long or short side.

Perhaps if one is 100% long, then he could buy deeply out of the money puts on QQQ or SPY?

Also, I don't think there is an event that could wipe out someone 100% short, i.e. a catestrohpic 'good' event. Therefore, it seems that the disaster scenario discussion must be kept to long exposure. Well, perhaps news of Bin Laden's capture may count as such a catestrophic 'good' event? But even if he were captured, I don't the think the market would react as dramatically as if a terrorist attack happened.

So what can you do to protect against catestrophic events?
 
another coincidence????

heres a post from jay in Novemeber regarding same subject as harry old boy....and guess what? They jsut happen to be the same age(33) and trading the same amount of time (9) years (although it was 8 in novembere wasn't it?

"Interesting thought...here is my answer. I have been trading now for 9 years...been at home trading now for over 6 of those years. I have made over 3 million gross over those last 9 years. It is something that I enjoy to do and honestly I don't care if I'm 80 years old I will continue to trade. Currently I'm 33. Remember a few things...the market will always be there...you cant be laid off...if you get tired of day trading when your 60 plus then just swing trade who cares...either way its a click of a mouse button or what ever they will have 50 years from now...hell technology is advancing so quickly I wouldnt be surprised if we have watches that allow you to voice control trades and market information that is sent to you via holographic images by surgical implant! My point is this...this when people retire they are bored to tears..and wonder what they will do with their time...for me the question is already answered...I will always be active in the market its what I love to do!
 
now heres' harry's quote:

I'm opening this thread to discuss a problem that is not often widely mentioned. To begin with a brief background of myself, I have been trading for 8 years now (mainly stocks). I trade full time (claim traders status), use Realtick software and I utilize both daytrading and swing trading strategies. I am also 33 years old, recently married with no kids as of yet. Now with that in mind here is my current "problem".
I have watched my equity increase steadily throughout the years, however; over the last couple of years while I have made more than enough to pay my bills and increase my account, I can honestly say that the percentages per year have been going down against my overal trading capital. I know this may not sound like a five alarm fire type problem as I have been profitable year after year for 8 years running there is an underlying issue. That issue is the underutilization of my trading capital.
 
I just read that post by Jay123 and I dont know what his game is but I can assure you that I have no idea who he is..and the fact we are the same age is coincidence...I don't appreciate somelike Jay123 screwing with those who would reply honestly to a real problem that I have..

Jay123 please leave this thread or I will send a message to the moderater..
 
jay, thanks for posting your question. I hope I have the same issue some day.. (if gold keeps going up, it might be sooner than later).


You really have a whole different world of problems to deal with.

Over 1mil +, I'd start to worry about:

1. Dollar risk (I'd want to be earning interest in euros or $cdn or chf, with some possible juice on a dollar deval)

2. Institution risk (what if one of my banks fails...)

3. Travel risk (get another citizenship. not too hard or expensive if you're willing ot buy some nice beach property).

FWIW, if it were me I would start trading more on a macro level. I like the mobius-esque idea of cherry-picking investments around the world-- dunnow if that kind of thing appeals to you.

At this very moment, I'd probably be interested in doing private placements into illiquid canadian gold companies (e.g. stock+warrant) cause it's too hard to buy 100k shares of jpn.v on the open market. But I'm a crackpot.

But the very first thing I'd do is go have a sit-down with the private client manager of my banking institution, and ask for help. Even if you don't take their advice, it can't hurt to get perspective from someone used to dealing with people coming into large amounts of money.

Best regards, best of luck, and thanks for your post.

--laz
 
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