So have hit 3,000 posts over 7/8 years and thought would post a brief landmark.
# Life is what you make of it. Thankfully, things have been going well; have just released my second book on business and life, and my first one is doing well.
# It seems like life goes in two speeds. For my projects, too slowly. In general, too fast.
# At the moment, am trying my hand in investing, possibly options, and hope to create a popular/successful site in the social commerce realm.
# Learning and curiosity is vital. Some things go well, others don't, but as long as you are learning something new and valuable it's in the long run for the good.
Tempus Neminem Manet Posted by MightyCow (Member # 9253) on :
Investing is fun. Be careful with options, they can have incredible risk. Make sure you know exactly what you're getting into.
Posted by Phanto (Member # 5897) on :
Yes, it is, thanks. So far, am up almost 9% on 20 days of trading in stocks. Doing it in theory, of course, but it's been fun.
Options are risky for sure but ultimately like stocks - if you can judge a stock's price fluctuations, you can reap massive returns from options.
Posted by fugu13 (Member # 2859) on :
Phanto: is this after fees, and only trading in stocks with sufficient liquidity, and not making strong assumptions about how finely you'll be able to time your trades?
Posted by Phanto (Member # 5897) on :
Pretty much, yes. With fees, it would likely be a significant amount lower, but I'm not making an overwhelming amount of trades.
Yesterday, for instance, gained like 2.2% from the following:
$2,250 US airways $10.01 Feb 1 $9.74 Feb 7 $2,500 Micron Tech $10.84 Feb 1 $10.97 sell Feb 2 buy $10.94 + $500 $10.87 Micron Tech sell $11.4 Feb 7 +$112 +$24 $1,250 S&W Seed $4.48 Feb 4 sell $4.74 +$73 $1,500 Suntech $9.16 short Feb 7 $9.17 $1500 ANR $52.36 Feb 4 sell $53.9 +$44
There, I had a good feeling about Micron Technology (due to DRAM/NAND markets) so bought $3k at about $10.9 and sold at $11.4 and S&W Seed (due to global crop climate) which bought at $4.48 and sold at $4.74.
I shorted Suntech because I felt it was due for a correction then changed my mind (as it secured a big deal recently), but it did go down 2.5% today.
Posted by fugu13 (Member # 2859) on :
You should run the calculation with fees for your intended trading platform. You'd be up around 4% just on dumping similar quantities in an S&P 500 fund at various times in the last 20 days.
Btw, I did a quick look at some of those stocks, and I'd check your assumptions a little. How would you have sold S&W at $4.74? It peaked up there for one trade, of a thousand shares (it is a very low volume stock), but nobody else managed to trade at that price. Maybe if your programmed trades got really lucky, maybe. But most likely not.
My advice would be to start off with, say, $500 to invest in stock, and actually invest it. If you set your trades properly, you won't be able to lose more than a hundred or so. Then see how much you make -- keep track of all your expenses, because if you start "seriously" investing, the fees will start to become a lower percentage. But then you'll get a feel for your actual ability to time the market. I'd do that for at least three or four months. Make sure you also keep a column where you put the price of an S&P 500 ETF at the same point in time (those are completely liquid, after all) and the fee you'd have paid to trade that, to compare your earnings.
It is possible to make money as a day trader, though not a huge amount -- roughly as much as applying similar skill at another profession would earn.
Posted by TomDavidson (Member # 124) on :
(It's worth noting that applying skill in another profession might actually be a worthwhile endeavor that produces things or services of value.)
Posted by Phanto (Member # 5897) on :
Oh, that is interesting, thanks for catching it fugu13; I assumed that if it showed that price for 30 minutes, it was for sale at that price for that long.
Yes, that's exactly what I intend to do. Just see how I do over a period of months with stocks and options, and maybe try to get a job in finance or see what may develop.
thanks.
Tom - actually provide something of value? but stock investing is key to the economy because without financing.... Posted by MightyCow (Member # 9253) on :
Also keep in mind that you're working on a very limited set of results. Over a short period of time, with the right luck, you can make some money.
The difficult thing is making money consistently.
A few years ago, I made a great trade on one stock, but a month later I made a bad call and lost all the money I'd gained on the first, and a bit more.
Keep at it, but don't fool yourself into thinking that because you made a few good trades you're a stock pro Posted by TomDavidson (Member # 124) on :
quote:but stock investing is key to the economy because without financing....
If you aren't taking out more than you're putting in, you're not getting a salary. Posted by fugu13 (Member # 2859) on :
Tom: that's fundamentally incorrect. First, in almost all cases the counterparties to trades are other traders, not the companies in question. So the money involved in trading is only being transferred amongst traders. Further, when someone makes money on the stock market, that means they have been on the upside of more market moves than the downside, and since market moves are generally tied to the success of the associated company (or companies, in the case of ETFs and such), they have been reallocating assets more effectively than average for participants in the stock market -- and as stock price is important for companies to gain funding and the like, that means the more effective allocation has provided a benefit for the companies involved.
Posted by TomDavidson (Member # 124) on :
Yes, yes, I understand the argument. And by all means, I don't begrudge people their decision to profit by skimming off the excess from the lubrication they've helped apply to our economy as opposed to doing something more useful.
Posted by fugu13 (Member # 2859) on :
If you still think what you said is accurate, you don't understand the argument Posted by TomDavidson (Member # 124) on :
No, I do. And like I said, I don't begrudge 'em their rationalizations. *grin*
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