Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Trading For A Living -- Ignore unavailable to you. Want to Upgrade?

To: Robert Graham who wrote (673)	7/3/1998 4:35:00 PM
From: Brentsky	Read Replies (2) \| Respond to of 1729

Bob, For a person who says they are a computer network consultant and mathematician, I don't know how you've become such an expert on daytraders. I don't know if everybody makes a six figure income. I'm sure a few do and quite a few don't. But, you seem to be confusing daytrading with regular long-term investing. I don't have an enormous amount of time to respond, because I'm trying to install NT on my system. However, you begin by saying a trader should only risk 10% of their equity. What makes you think a daytrader who has a $50,000 trading equity has no other money? Remember, daytrader has the word "day" in it, which makes it the less risky of all investing, providing the trader is disciplined to taking small losses. I've followed a few of your gloom and doom messages and wonder what your real intentions are. Sure, some people get into daytrading and lose money. Money failures are everywhere. What percentage of start-up businesses do you think fail every year? More new businesses fail than succeed. Should everybody stop trying new business ideas? Of course not, it just means you have to be aware of the risks and, more important, know what leads to success. I am new to this but have had many traders private message me with perceptions (none have any reason to lie in a private message). Yes, daytrading is risky, yes it takes discipline, but, also, yes there are many successful traders. Brent

To: Robert Graham who wrote (673)	7/3/1998 5:00:00 PM
From: Tim Luke	Respond to of 1729

It's very possible to make 100K in one year of trading with less then $50K of capital. I have done this in my second year of trading, my first year was a wash out and a year of learning the hard way. My second year I started off with $25k trading on margin and I net over 100K, so it can be done if you have the skill, luck and timing down.

To: Robert Graham who wrote (673)	7/3/1998 7:36:00 PM
From: Darren	Read Replies (3) \| Respond to of 1729

With all due respect to Darren, I find it difficult to accept the statement that one can make a six figure income as being "pretty easy if you have at least some aptitude for trading". I have run across individuals here at SI that did demonstrate "some aptitude for trading" that washed out in the end. All they managed to do was stay in the game longer than many people have before coming to the understanding that trading the market is not working for them. Well, I guess it depends on the trader, and what you feel is easy. I'm not going to go through this message line by line and reply...Every person I know who has traded for longer than 6 months makes between 150-200% each year. Yes, there is a learning curve. Yes, you can lose your ass. But your representation is much too conservative. Day-traders buy 1,000 shares or more of each stock they buy. 200 shares would never even pay for commissions, which are between $20-25 per trade. The idea is, buy 1,000 shares, make 1/8th for $125 and pay $50 in commissions. Lower commissions equal more money for you. Fewer losses equal more money for you. I've never seen a trader over 40 make it in computer trading, but it's not that they don't exist somewhere. Forget about managing 10% of your portfolio, or whatever. Take what you can risk and trade it fearlessly. Take no more than 1/8th loss if you can help it, and let your winners run so you are playing or risking the markets capital whenever possible. Don't take chances. Don't trade in horizontal markets. Don't ever take a position home. I'm also talking a buying power of $100,000 and $50,000 in risk capital to start. IF you are talking 10K, I don't know how you can make it. Most people say $100K is the minimum, but I tend to think $50K is OK. As an example, you could have shorted 3,000 shares of DIGI the day they were bought out at the open and made about $5K if you held until lunch using about $60K of buying power, $30K of capital. That's 2 tickets, 1 trade, and 18% on your money. Forget intelligence, this is raw capitalism. You see a trend and you go along for the ride. At worst, you essentially have a 50% chance of being right. Clearly you are spending too much time thinking about it... What is a trader's success rate? You have to be right 60% of the time to break even. I'm right about 3 times in 4, or 75%. I do believe there are people who are right more -- some traders go about 200-300 days without taking a loss. That's amazing, but it's possible. I guess life as a trader is not that easy or success is not that predictable of an outcome, is it? Believe me, I'm not saying anyone can do it. But, at least theoretically, anyone can do it. It takes persistence and determination, and some luck on the front end when things are tough. In the book Market Wizards there was a trader who took 8 years to learn what he was doing. He got his butt kicked for 8 years, but he's now a great trader. What trading is not is a get-rich-quick-scheme. It's a slow methodical path. A lifestyle. A dedicated job that will kick your butt at every opportunity you give it. So, you wake up with your head on or you lose it. And, obviously, some people have it, some people don't. The people who don't complain about how hard it is and how risky it is and are determined to make it make it. The others become "trading experts" or "authors" or "Chat Line Admins" or "B/D's" or even successful people in other fields... I'm sure everyone that has ever thought of being a trader has gone through all this already...