Learning Investing

[fees]

Are you ever gonna host some penn games? step 3 obv

[stephenNUTS]

As a former B/D owner,I have ONE word of advice for anyone new to investing in the market.

I became fairly wealthy retiring after 20 yrs from the commisions from daytraders alone

DO NOT DAYTRADE..the Big Boys will eat you up,as intra-day trading can run up HUGE costs,from commisions,ECN costs from ARCA/Island,monthly sofware costs(a premium daytrading platform like RealTickPro costs almost $300 a month),etc

If you are DT'ing from one of their remote locations(we had 20+),it will cost even more as they(the B/D) will encourage 40 or more trades a day.If you are trading from home,you are an isolated target lacking live news feeds as Bloomberg-Reuters,cable connection vs. T-1 or better yet T-3 lines,home distractions,etc.You are gonna' go broke fast just watching CNBC or Cramer(what a joke/FOOOL)from home

This is WAAY too much to over come.Sure a B/D will give you a muliple monitor set-up,free lunch,BS you with all kinda CANT MISS formulas,etc...but it is ALL about the # and volumn of each trade.

You are only a commodity while trading with them....until your last one.Then ,,,,,NEXT!

~stephen [img]/images/graemlins/cool.gif[/img]

If you have any questions,feel free to ask

[fees]

Wow nice post, =D. I was more interested in leaps/options b/c of how lucrative they were, but I wanted to approach it like I was researching companies/industries and making assessments as to what direct the company/industry was going. Is this practical/doable? How risky is it, assuming you do everything possible to research (fwiw these are 3-12 month plays, poss longer but assume this time frame)

[stephenNUTS]

[ QUOTE ]
Wow nice post, =D. I was more interested in leaps/options b/c of how lucrative they were, but I wanted to approach it like I was researching companies/industries and making assessments as to what direct the company/industry was going. Is this practical/doable? How risky is it, assuming you do everything possible to research (fwiw these are 3-12 month plays, poss longer but assume this time frame)

[/ QUOTE ]

Any form of trading beyond daytrading..swing trades( a couple of days,to a few weeks...,short term( afew months but LESS than one year...,and long term(1 year +) can be profitable if managed properly.

Some of my BEST trades were swing trades,and to this day, managing my family accounts/estates, the bulk of my trades are swing or short term trades

From the equity side of the market,if you are going the LONG term route,and and dont want to stomach the day to day fluctuations...stick to some no-load Mutual Funds and let the Pros deal with the descisons. Dollar cost average if you can,setting aside a specific amount of monies each month.Starting at a young age you will be a happy camper down the road!

As far as options......BE CAREFUL!

Many a whiz kid has gone broke walking into the treacherous waters of option trading.They come in with complex trading strategies after getting their MBA's ,and the markets/seasoned pros ALWAYS adjust and eventually they dry up.
Most of these guys just come and go.

The majority of option plays I personally traded were WRITING them,and collecting the premiums as a hedge,on a covered equity play from the long or short side

GL
~stephen feraca

[fees]

Hrm,
Well I want to become a pro, hence this thread. I guess I'm a whiz kid? I guess what I'm asking is whether or not its possible to be sustainable trading options as an individual or is it impossible? I'm not thrilled at the prospect of working for a fund after I learn how to trade (I will do a coop at a hedge fund over the next few years), but thats just because I would be very pleased to work for myself, by myself.

So I guess what I'm asking is; is it possible to trade options profitably, indefinitely as an individual?

[stephenNUTS]

[ QUOTE ]
Hrm,
Well I want to become a pro, hence this thread. I guess I'm a whiz kid? I guess what I'm asking is whether or not its possible to be sustainable trading options as an individual or is it impossible? I'm not thrilled at the prospect of working for a fund after I learn how to trade (I will do a coop at a hedge fund over the next few years), but thats just because I would be very pleased to work for myself, by myself.

So I guess what I'm asking is; is it possible to trade options profitably, indefinitely as an individual?

[/ QUOTE ]

Hello Fees,

I wasnt implying anything against YOU being a new whiz kid.It was a generic W/S term,for new players on the street..

As far as making money long term in the options arena,do you mean trading them on an individual basis...and not for or with a firm/fund EVER?

What I was trying to say was that options are a tough game.The major players/market makers have DEEP DEEP pockets and will do what ever it takes for THEM to profit.Whether from the short/long side....they can and will push/pummel a stock until there adgenda is satisfied,and that is why 95% expire worthless.

As to YOU making money trading them....sure you can I guess.It was not my specialty,but I always made some $$$ writing them/collecting premiums,...but remember I was an equity trader for some big funds/houses,so my positions were usually covered either way.I had some sick buying power to hedge my trades with,so I dont know if financially it can be done long term the same way by yourself.I think you should be properly funded though IMO.

The main point I was trying to make about option strategies was that MOST of new algorythms employed recently by the new MBA's work for short periods of time only IMO.
The market always catches on at some point in time

Sorry if you took my response the wrong way [img]/images/graemlins/smile.gif[/img]

GL,
Stephen

[fees]

Stephen, I wasn't at all offended, I just assumed thats how I was classified?

You said MBA's came up with algorythms to try and figure out how to buy/sell?
Wow, I'm new at trading but this seems so impractical and like you said exploitable. My approach was going to be focusing on companies that I though had all the components of a successful company, good management, product, distribution, financial, etc. Basically I plan on researching the industry/company and make decisions about where they are going based on what I read. I also plan to gain a network of traders/friends to run ideas/thoughts passed. I wanted to trade options b/c they are soooo crazy lucrative. Also I am only vaguely familiar with how funds can abuse individuals, I read some examples in confessions of a street addict but I'm still not to the point where I understand how the markets work and how their hedging will [censored] me.

But thanks again for your response, it was very helpful.

Ryan

[PRE]

[ QUOTE ]
Stephen, I wasn't at all offended, I just assumed thats how I was classified?

You said MBA's came up with algorythms to try and figure out how to buy/sell?
Wow, I'm new at trading but this seems so impractical and like you said exploitable. My approach was going to be focusing on companies that I though had all the components of a successful company, good management, product, distribution, financial, etc. Basically I plan on researching the industry/company and make decisions about where they are going based on what I read. I also plan to gain a network of traders/friends to run ideas/thoughts passed. I wanted to trade options b/c they are soooo crazy lucrative. Also I am only vaguely familiar with how funds can abuse individuals, I read some examples in confessions of a street addict but I'm still not to the point where I understand how the markets work and how their hedging will [censored] me.

But thanks again for your response, it was very helpful.

Ryan

[/ QUOTE ]

It sounds like you're mixing two different types of investing: short-term trading and fundamental analysis.

[fees]

Can't do that? Can you point me in the direction of definitions of those types of investing?

Thanks

Ryan

[Foghatlive]

[ QUOTE ]


What I was trying to say was that options are a tough game.The major players/market makers have DEEP DEEP pockets and will do what ever it takes for THEM to profit.Whether from the short/long side....they can and will push/pummel a stock until there adgenda is satisfied,and that is why 95% expire worthless.


GL,
Stephen

[/ QUOTE ]

Great post, Stephen

It's always nice to see some reality injected into the internet fantasy world where it's easy to make a killing at the market.