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Strategies & Market Trends : Are you considering quitting your dayjob to daytrade?! -- Ignore unavailable to you. Want to Upgrade?

To: SpongeBrain who wrote (35)	1/17/1999 12:31:00 PM
From: J. P.	Read Replies (5) \| Respond to of 611

Interesting to hear other people's thoughts on this. RE: Quitting one's job and day trading First of all, I've tried to 'day trade', and have found that for every 5 trades one is successful at, 1 bad trade can wipe out the whole profit, and this numbers game fails in time, like the laws of averages on coin flips. Hardly a basis on which to stake one's livelihood, in my opinion. For me, position trading has yielded incredible percentage gains. Well, when I first started I consistently lost ALL MY MONEY by trading in small caps. It took me a couple of years of diligently trading (most of it at work with a laptop dialed in to quotes,or on their internet) to turn the whole thing around and begin to make money. I even got canned once for being on the internet at work, because I was going through the firewall and they kept a record of that somewhere! I was on the internet at work 8 hours a day, 5 days a week and doing my job on the side, luckily I'm a decent programmer so I could carry it off, knew about the firewall but didn't give a damn, cause there's so many computer jobs out there. But now all that has changed. I make 6 figures on my IT job, but only use it as a mental diversion so I don't trade on emotion and SCREW UP my successful position trades. In fact, when I'm making a paltry 800 bucks a day at my job, sometimes I'm making 10, 20 thousand on that day on the market! Or conversly,I could be losing 10, 20 K on that day, and actually being at work for a huge financial loss! (I position trade options, which huge eyepopping gains are possible, I can tell you it takes years to perfect these methods, and incredible amount of time initially, I think only 1 in 100,000 investors can make this work, but it does work, and that is a fact, the ones who doubt I will tell you never spent 60 hours a week for 2 years analysing methodologies and actually going in there and failing 200 times till they got it right! There is a high price to pay to learn the options strategies and general market analysis to make it work) But I've tried to sit at home but found it hugely counter productive in that I begin to micro manage, and that is no way for me to make money in the markets! It's only by riding cyclical market waves up or down, and ignoring all the head fakes and little day to day tricks that the professionals use that the real big money can be made, IMO. Plus, the other factor I'd like to add, even if you're making six figures on the market per year, it's very nice to have that cash flow from a job. Because you hate to draw down from your accounts to fund stuff like mortgage payments and groceries. And if you make a good salary, you can treat your check like 'mad money' and just throw money around, and lavish your wife or girlfriend with toys. So my vote is to position trade and keep your job so you don't screw it up by trying to short term outthink the market!

To: SpongeBrain who wrote (35)	1/17/1999 12:56:00 PM
From: Mark[ox5]	Respond to of 611

<<<<<<During the August downturn, fund investors (like myself) got burned badly. I'd bet daytraders took much smaller losses, or made money shorting. I think your wrong on both counts. A) I think a lot less people than you assume short. B) In mutual funds I follow most took 25-35% short term losses which they eventually regained. 2nd, most people dont "trade" mutual funds... so at this point they have all their money back plus more. People (on average) in mutual funds are more buy and hold vs equity traders... so you dont get "burned" unless you sold... and most people i know in mutual funds just held on. C) In a 2 month down market, traders are still trying to buy and make money... so if you have a stock which in 2 months has gone from 150 to 80, and you traded it many times you can lose many times say from 140 to 135 from 125 to 120 from 110 to 100 etc and all along the way your going, this has to be the bottom, this is so undervalued... etc Your looking at August/Sept with 20/20 hindsight...when it is actually happening & your actually living it, you dont know (at that time) it is an extended period of downturn... when it first started happening people thought, ok this is one of our typical 5% corrections and they buy at the bottom of the 5% correction, only to see another 1.5 months of losses. I think your analysis is also based on zero emotion. What I mean by that is unless your a computer and/or your the most highly disciplined person I ever met... you wont always say "ok 2% loss and I'm out". There is the emotion of "Ok I will get this 2% back, just stick in it another day... today has to be an up day". Then the stock gaps down at the open the next day another 8% and your cursing. If you can find me one trader in the world who always sold at 2% loss and never let emotion interfere I have some great land in Florida to sell ya ;) Trust me, looking back at August/September and analyzing it, versus actually trying to trade in it is a lot different. Even with shorting.. if its mid September and the market has corrected 15% (which was the 1st time in 7 years?) do you still short? when the market has the potential to come back 10% and individual stocks go back up 30% within a week or 2? Its a lot differnet than analyzing it now :) Mark