Daniel, one way to optimize the situation is to stick mainly to stocks that trade plenty of volume but also not too fast. There are plenty of stocks that trade between a million to ten million shares per day and if they are swinging in price, it is the place to be. The pace of the trades is good and steady allowing you to judge the patterns more easily and to always have the liquidity to bail in or out with out much difficulty.
Trading DELL for me is just about impossible. Just too much for my internet connection and for me.
Don't get me wrong its not impossible, but it is much more difficult and to me just not worth the trouble.
I would bet you have traded an illiquid stock and so you know how that works. I will trade one occasionally but those are often position trades or on days that the volume is way above normal.
If we assumed that there is one and only one rule for trading.... never let a stock go against you... if for simplicity we agreed that was the only rule; then I would say that you want a trading system that lets you control your entries and exits nimbly and you need to pick stocks that are relatively easy to trade in and out of.
Since I hooked up with Manhattan Beach; the only times I have taken a beating... while I was sticking to the rule... was when I was in a low volume stock or in a fast market stock ... IPO's are a good example.
So after a few memorable beatings, I have learned to pick active stocks.
So to answer your question... YES! With the direct executions, reasonable stock picking, and a proper mental attitude <<< that's the tough one >>> I can jump in and out with very little slippage.
When you recognize the signals telling you to hit the button, and you do not hesitate, but confidently and quickly act on what you know, man it works. the classic frustration is when you see the signals, know its go time, wait a few seconds, then a few more, and then ten other guys did what you knew to do, now the market moves, you get a partial or no fill.
I would say that at this point the difference between a great day and a bummer is 90% me 5% luck and 5% the broker.
I am only as good as my next trade, so don't take my word for it, but the two greatest qualities you can cultivate within yourself, the two that I think about every single day is patience and flexibility.
funk |
