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

To: jebj who wrote (486)	1/30/1999 9:04:00 PM
From: kaydee	Respond to of 611

I am not sure if some one has mentioned about this interesting thread/topic (IMO)... I saw it just now... The title says : Working All Day, But Trading Behind the Bosses Back Thread Subject 25035 Update 9:10 PM; I read the first 10-20 posts, the thread looks more like a stock pick thread IMO...

To: jebj who wrote (486)	1/31/1999 2:52:00 AM
From: kaz	Read Replies (2) \| Respond to of 611

"And that was my point - as long as the market is increasing, and over its history it continues to do so, there is "new" money coming into the game. Without this "new" money, individual stocks would go up and down but the market would remain the same and you point would be correct." So you admit it! Just joking. The market is increasing, yes. More and more people are putting more and more money into the market. More and more people are giving the few winners more and more money. The wealth is not being spread more broadly just because the market goes up. Don't jump over this point lightly, whenever a stock's price increases, a short loses money. The short loses more money than the long wins due to commissions and slippage. Doesn't matter if the market jumps 1000 points. The loser loses more than the winner wins. "This new money coming in is why the stock market is different from the example of the poker game given with everyone starting with the same stake. In that example, taking a commission out on each hand would, indeed, be as called." No, commissions are the reason why the poker example is different from the market. Poker and the market need new losers in order to survive. "...your suggestion that every time a stock is sold, someone wins and someone loses does not hold." Correct. However, every time the price goes up, somebody loses (the short). Every time it goes down somebody loses (the long). The net effect is, once again, losers losing more money than winners are winning. ">Why would anyone put their money in the markets?< Is one to assume from this statement that you do not? :)" You could assume that, but you'd be wrong. I trade. Last year I more than doubled my account. Sheer luck. This year I am slowly but consistently losing what I made last year. So I've stopped actively trading to re-evaluate my trading and myself. I know money can be made trading. I just haven't gotten to the point where I can do it with any consistency. It's that "over time" that's the problem. That's when probabilities and statistics prove themselves. And when the statistics show that 90% of all traders lose money, you'd better damn well know why. And I don't, yet. ">All the individuals who come on these threads to brag, "I just made $5000 today, $20,000 last week and I don't see it ever changing," let us know how you're doing this time next year, if you're still here. The chances are overwhelming you won't be.< I am missing how this relates to the original subject." I believe it is appropriate to point out to anyone who is considering trading as a way to support themself that those who are bragging should not be listened to. Harsh? Maybe. So is losing your money, house and family. It's happened to more than one poor soul who started out making decent money but couldn't stop when they began losing. Further, it skews reality just like the whole zero-sum thing. If you're going to play the game, at least you should know the rules. I've given my opinion of them- that the deck is stacked seriously against the small trader. But reality is meaningless when someone whets your appetite with how much money they just made. That's not trading. Many people make what seems like a lot of money early in their trading careers. I did. Doing that long term is VERY, VERY hard. Just like heads can come up ten times in a row, people can get lucky. Just don't think that it's going to last, because you are very capable of losing all your winnings and more. ">Then anyone who is losing money MUST be a moron since, over time, you can't lose in a positive sum situation.< Given enough time and unlimited resources you are correct - however one COULD wait a very long time for a head to come up in a coin flip." Agreed. And that's with a zero sum game (one winner for one loser, no commissions- waste of time but you won't go broke). Imagine how much longer you'd wait in a negative sum game (even with 51/49 odds against you, over time, you'll lose everything). Regards, Paul Kaz