Re: Richard' questions:
You make reference to the fact that someone like me might recommend selling stocks at the end of the day because of commission: Let me address that:
1. In making that statement, you haven't followed my opinion of day trading in general. If you recall, and someone might point you to the two or three days of this discussion that we had, I was virgorously opposed tomost individuals daytrading at all. Not only do I consider it fool's gold, but I strongly feel that the real, big money I have seen made by clients and others on the street has been through disciplined investing. As I have stated, 90% of my firms' business is from long term clients, institutionssuch as the Bank of NY , trust co of NJ, money managers, smaller accounts, etc. We provide sound market advice and have had great sucess with it for 20 years. 10% of our business is the active trader. Because of our market approach, we have a great niche. We have clients who are brokers and traders at other firms, specialists on the amex as well as your typcial day-trading client. Day trading for me is less than 20% of MY, personal portfolio/investment activity. It is a nice supplement when done properly and timely.
2. If you are suggesting that I might recommend to anyone that they buy or sell a stock JUST to get a commission, you don't know my integrity or sincerity in providing advice.
3. If you thinkthat a firm that charges $25 for a trade,makes $25 for the trade, you don't understand the brokerageindustry. Firm have clearing and brokerage (floor or electronic communication) costs in a trade. For instance, at our firm, we have about $18 clearing costs on each ticket we do. SOES is a few pennies per share, selectnet is about $2.60 per share and the specialists onlisted exchanges charge a few peenies for listed limit order. Part of this goes towards my argument that firms that do business for this $20 per trae have to be making elsewhere, most likely to your detriment.
4. Gap downs - exact figures..no i have no idea as to exact numbers. I am not a statistician, I am a trader. In an up market, like the one from 1995 through midway last year, stocks on more occassions gapped up than gap down. ZITL ran from 15 to 72, IOM from 3 to 100 INTC from 50 to 200....all you had to do was throw money at a trade and you succeeded. In a down market, the potential for gap losers is greater.
MORE IMPORTANTLY, when stocks gap down, they gap down harder than they do when they gap up. It takes 3 years for xyz to go from 10 to 18 but can go back to 9 overnight on news....on good news its not going from 9 to 18. Stocks that gap down also usually continue to gap down. This is why I usually don't bottom fish until I see 2 or 3 bounces....
Richard, when i noted that there might not be that many traders posting up here who were unsuccessful because they were no longer traders and no longer on this thread, I did not mean any disrespect to anyone. That traders come and go is part of being a trader. Its not a shingle you can always put onyour roof.
As for how doyou pick stocsk, I usually do the following and somewhere in here come a list of a hundred stocks I might watch for a trader:
1. I quickly (in less than10 minutes) check out IBD each morning for stocks withupticks/ downticks in volume, % gainers and news stories.
2. I always try to get a quick grasp of coming reports and earnings. I hate owning stocks at or on earnings.
3. I setup my screens so industries are segmented...hardrive together, box makers together, industrials, transports, etc. this way I can see where the money is flowing.
4. I setup a multi column page so I can see bids, asks, last, lasttrade voume, total volune, news etc.Youcan sort of see my setupwith some of the screenshots inthe Yamner University, yamner.com
5. ThenI start to focus down on stocks that are printing well. By printing well, you are looking for nice prints, good action, bids that increase, offers that leave.
6. I watch the bond market religiously as well asn the TICK and TRIN.
Their is a good articleon the trin at yamner.com try htm if html doesnt work.
Ultimately, there is not set strategy that works all the time. Youeventually have to have a feel for it, a tickle in your gut that tells you to buy some stock.
Regards,
Steve@yamner.com |
