Why day Trade?

[Pa(b)st Prime]

Quote from volente_00:

Pabst,


Can you please clarify and define a few terms for me


significant money

small account

how wide of time sample

All of those variables are dependent on the wants of the individual trader. Most people coming into this business are delusional. I bet half the small traders on ET think like this, "If I achieve seven 100% consecutive compounded returns on 10k I'll make 1.25mil. I'll try to make .05% a day and in 1400 days I'm there!!!"

That rarely, rarely, rarely happens. Hell it rarely happened on the floor and that was after the advantage of paying dick in commissions, trading in front of orders (no queue) and regularly doing stuff that was almost felonious.

Since traders are making a series of probability bets than why not model how other small traders became successful? By and large it was by catching a swing NOT a series of 1400 consecutive .05% days. I know this isn't applicable to a few stock traders who've developed an edge-they can wipe out the bid on 20,000 shares and then bid them back a dime lower-but in futures the tape reading edge is random. Does anyone here have a CLUE as to if the Dow will close today +130 or down 48? Or how it'll do it? Random noise. Unmeasurable. Random results by traders. Minus of course zillions in commissions.

 

[ucf_student]

Quote from Pa(b)st Prime:

All of those variables are dependent on the wants of the individual trader. Most people coming into this business are delusional. I bet half the small traders on ET think like this, "If I achieve seven 100% consecutive compounded returns on 10k I'll make 1.25mil. I'll try to make .05% a day and in 1400 days I'm there!!!"

That rarely, rarely, rarely happens. Hell it rarely happened on the floor and that was after the advantage of paying dick in commissions, trading in front of orders (no queue) and regularly doing stuff that was almost felonious.

Since traders are making a series of probability bets than why not model how other small traders became successful? By and large it was by catching a swing NOT a series of 1400 consecutive .05% days. I know this isn't applicable to a few stock traders who've developed an edge-they can wipe out the bid on 20,000 shares and then bid them back a dime lower-but in futures the tape reading edge is random. Does anyone here have a CLUE as to if the Dow will close today +130 or down 48? Or how it'll do it? Random noise. Unmeasurable. Random results by traders. Minus of course zillions in commissions.

Nice post Pabst. I agree 100%.

 

[reno4nook]

Think about leverage.

A day trader can use less capital to control a large amount of assets than a swing trader.

Day trading margins are considerably less than overnight margins.

 

[PatternMaster]

Quote from casioboy:

Hmmm....day traders you talk about "only going with the longer term trend" so why even day trade and be restricted by the clock?

To me day trading is "spinning your wheels" It's stressful, you are tied to the quote machine every day. It's not making money every day and from I can see there is more money to be made position trading.

I wonder if day traders have actually considered if they really make more money day trading as to holding fr days at a time?

Any thoughts?

It's simple....get rich quick.

It's a societial thing..... Fast food; fast cars; quck wars (shock and awe...mission accomplished); fast money...........................................get rich quick!

Ease of access to discount online brokers, and price charts makes it all possible to get up and going quick for the get rich quick wannabees.

The gambling mentality is at work.

And Pabst is correct....they will fail.

 

[Banff01]

Pabst,

interesting argument but it only applies if markets are truly random which they are NOT. Thus, there is no reason why there could not be an long-term edge daytrading futures. And why should you even care where DOW closes?

Quote from Pa(b)st Prime:

All of those variables are dependent on the wants of the individual trader. Most people coming into this business are delusional. I bet half the small traders on ET think like this, "If I achieve seven 100% consecutive compounded returns on 10k I'll make 1.25mil. I'll try to make .05% a day and in 1400 days I'm there!!!"

That rarely, rarely, rarely happens. Hell it rarely happened on the floor and that was after the advantage of paying dick in commissions, trading in front of orders (no queue) and regularly doing stuff that was almost felonious.

Since traders are making a series of probability bets than why not model how other small traders became successful? By and large it was by catching a swing NOT a series of 1400 consecutive .05% days. I know this isn't applicable to a few stock traders who've developed an edge-they can wipe out the bid on 20,000 shares and then bid them back a dime lower-but in futures the tape reading edge is random. Does anyone here have a CLUE as to if the Dow will close today +130 or down 48? Or how it'll do it? Random noise. Unmeasurable. Random results by traders. Minus of course zillions in commissions.

 

[SethArb]

-It's completely the opposite. There are ZERO futures traders who will make significant money day trading a small account. Granted as of late there's been daily ranges as big as some prior years but by and large when someone tells me they "daytrade" index futures I know with almost absolute statistical certainty that over a wide enough time sample they'll be unprofitable. -


sheesh

I must be a lucky son of a gun then

 

[volente_00]

Account size is not a concern if you have an edge that has a higher probability of winning than losing unless you have a whacked out risk to reward ratio. Hell you can even have a 20% win rate and be net profitable if your r to r ratio is high. For a newbie the account size will matter more until they make it past the learning curb but for someone with experience who can work emini's consistently there is no need to have a 100k account when you don't ever use it. Trading es is no different than trading stocks at a prop firm with high leverage as long as you control your risk and respect the market. For someone just starting out there is no need to trade more than 1 es contract for every 5k of capital, using 3% max risk per trade.

 

[smilingsynic]

Studies of daytraders in Asian markets suggest that few traders make and keep most of the money, and that most daytraders in the long run fail.

 

[college_trad3r]

trading emini futures is less risky then trading stocks.

remember black monday, what happens when youre holding a stock and the black monday happens Pre-market. With stocks you will be screwed, with futures not so much.

Besides, if you trade stocks, stocks are based on one company, it has happened in the past a company went bankrupt out of nowhere. The retail trader will be the last one to find out.

 

[bighog]

Pabst said:............... and regularly doing stuff that was almost felonious.


hahahaha, pabst, please describe the law where a felony is ALMOST,

is stealing from the public ALMOST a exchange perk or a right of membership? AHH, the good days of the pits when the lions gobbled up the public and went home and kissed the wife and kids.

volente, very, very good stuff there. It is a shame many will not do it that way. The visions of getting all the money supersedes common sense in a game of chance.