options (finance)

[Kirkrrr]

Emon,

Yes, I'm totally self-employed, and yes it's all from my house. I'm 100% confident that I can make a living trading. In fact, let me rephrase that: I'm 100% confident that I can become filthy rich trading (qualification: filthy rich = net worth > 10M, which is plenty for me).

KKF,
I have already mentioned elsewhere that day trading is my focus right now, though as I get better and learn more I will start taking more long-term positions. The thing most people don't realize, though, is that any time your money is in the market it's at risk, so the longer amount of time you take a position for, the greater the risk becomes. Thus I will invest for longer term as I get better, not vice versa.

SlowHabit,

Cool [img]/images/graemlins/smile.gif[/img]

btw, you have a guy that runs a desk at a hedge fund in this thread, why doesn't he have a billion questions directed at him??? this is like a golden opportunity for everyone.

Kirk

[emon87]

kirk,

What makes you so sure? I'm not doubting that you can, just wondering what you base your confidence on.

[xxThe_Lebowskixx]

kirk,

"So to say I'm no authority on trading/investing is an understatement of the year."

"I'm 100% confident that I can become filthy rich trading (qualification: filthy rich = net worth > 10M, which is plenty for me)."

I am not trying to be snide, and this thread is exciting and inspiring for me, but can you please give more details on why you are this confident. Do you feel that you can clearly look at your results and see that you are not running lucky and that it is actually your decision making that has led to your success? And since you dropped some numbers, what bankroll are currently using, and how much have you made thus far?

[owsley]

[ QUOTE ]
quantitative degrees from school

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Could you be more specific on what kinds of degrees are included in this? math majors, engineers, or finance majors? what kind of academic background do you need to get into this field out of college (i assume the school being prestigious is important)? If you were talking to someone who has already gone down the road of the humanities to a certain degree but has a genuine interest in market, does a lot of reading, understands poker/bankroll management/similiar things, what kind of advice would you give that person?

[Shizzle12345]

@kirk

how much do you need to get started in this? With poker you can ofcourse start with a 50$ Br and follow Br management, but you wont get there fast messing around at the nano's.. I know almost nothing about this, and not planning to do so, but when i happen to earn more with poker i might get interested in it and start studying it annd try to become good and see if its my thing [img]/images/graemlins/smile.gif[/img] . It sounds really interesting..

[xxThe_Lebowskixx]

@kirk

i was thinking today how little you would to gain percentage wise if you were using a large bankroll. for instance, say that you would buy $500k worth of a stock, if it goes up just .0025 percent, you would have made $1250 before fees. I am not sure how realistic of a model this is, but it does seem that someone with a large bankroll could keep skimming milk off the top all day long.

[The once and future king]

Anyone who day trades stocks might as well throw darts at a dartboard.

Stocks have been trending upwards for a long time, so if you had been doing the above you will have most likely shown a profit.

It is a great Bull market. When the market goes very Bear, thats whats sorts the men from the boys and I expect Kirk may have to revise his expectations. Day trading in a Bear market is nigh on impossible.

As Kirk said History tends to repeat itself. There was a time not that long ago when every man and his dog was day trading, where are they now?

Also a bear market is imminent imo.

[ceczar]

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Day trading in a Bear market is nigh on impossible.

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i agree with the general point of your post, but this statement is wrong. when you're trading with a margin account it's just as easy to short 1000 shares of IBM as it is to buy. downtrending markets tend to fall faster than uptrending markets go up, so there should be more potential for a day trader to make money when the market goes sour.

but it is for sure true that it's easy to grow overconfident in your abilities and the likelihood of continued success if you have only traded for a short time in just one type of market environment.

also, for those of you considering a trading related post-poker career, please at least aim higher than day trading (either for your own account or a day-trading firm). not that everyone would be concerned about the prestige aspect of it, but to the rest of the street, day trading stocks engenders about as much respect as being a stock broker. and that should be a concern if you are trying to leverage something like day trading into a "real" street trading job, especially something that is not just straight stocks.

getting on a trading desk for a big securities firm or a hedge fund has so much more potential for $$ and for actually doing interesting work, regardless of whether it's market making or longer time horizon strategy stuff.

[Kirkrrr]

[ QUOTE ]
I am not trying to be snide, and this thread is exciting and inspiring for me, but can you please give more details on why you are this confident. Do you feel that you can clearly look at your results and see that you are not running lucky and that it is actually your decision making that has led to your success? And since you dropped some numbers, what bankroll are currently using, and how much have you made thus far?

[/ QUOTE ]

You are completely incorrectly assuming that my recent results have anything to do with my attitude. As a matter of fact, I got my ass handed to me in the market every day for the past week or so, and today - sadly - was no exception. The thing is, I keep a log of all my trades, I am developing better systems and methods, and when I go back over my trades and "debrief" I can see that there's drastic improvements. It's a lot like poker, you can play it right and still lose, but you know you played the hand correctly. It's really tough to explain more than that.
Far as how I can be this confident... I don't know, do you wake up in the morning and just feel like you can't accomplish something? .. I don't. I simply go by Winston Churchill's "Never, never, never quit." It works. Plus I'm half-Jewish and to us it comes naturally [img]/images/graemlins/wink.gif[/img]

I started with 25k since it's what you need to be able to do pretty much anything in an individual trading account (if you have less you're not allowed to trade using certain strategies but I won't get into that here). Firm I trade with gives me 10:1 margin, hence the 250k room to maneuver that I have. It's a pretty good deal, especially since it's free unless I keep it overnight. It's also money that I could afford to lose and reload so I can learn without fear of going broke... which definitely doesn't mean that I intend to, far from it. I am aggressively-conservative with by capital [img]/images/graemlins/smile.gif[/img]

Kirk

[Kirkrrr]

Shizzle, see my post above. You could go as little as 10k but 25k is optimal.

[ QUOTE ]

i was thinking today how little you would to gain percentage wise if you were using a large bankroll. for instance, say that you would buy $500k worth of a stock, if it goes up just .0025 percent, you would have made $1250 before fees. I am not sure how realistic of a model this is, but it does seem that someone with a large bankroll could keep skimming milk off the top all day long.

[/ QUOTE ]

Umm... no, not really. The trading fees would instantly eat up your profits, and also in the absolute near term the stock has pricsely as much of a chance of going up .0025 as down. Today I was trading Unites States Steel Corp (X) and it's an extremely volatile stock which goes up/down .17c roughly every 17 seconds or so, depending on time of day (trading volume on the whole really dies down around NY lunch time and picks up again after 1pm, usually), you try to "skim" it you will get absolutely killed. But if you observe trends and prevailing market conditions your edge increases exponentially, and that's where you stand to make money in the long-term, with "long-term" being the key concept here. Again, it's a lot like poker - just because you win 5 hands in a row doesn't mean you're the best in the world, and vice versa. You're going for 1000's of "hands" until your edge manifests itself.

TOAFK,
I wasn't going to say anything because your post is so totally ignorant that it really doesn't even deserve an answer, but [censored] it, other people are here to learn so for their sake I will reply to your inane drivel:

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Anyone who day trades stocks might as well throw darts at a dartboard.

[/ QUOTE ]
Addressed numerous times in this thread.

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Stocks have been trending upwards for a long time, so if you had been doing the above you will have most likely shown a profit.

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"Long time" is very arbitrary, try to at least sound like you know what you're talking about. The DOW bottomed out in October '02 and has been on the rise ever since, granted. The thing most people forgot to pay attention to is that the dollar has lost over 30% of its value since the high in January '00. Adjusted for actual dollar value right now, we're about 18% off its peak back in '00 which would put us square in bear market territory. But lets leave that for right now and take a look at ANY chart. You see that stocks don't just steadily go up, they go down. They go down, in fact, 2.5 times faster on average than they go up since as they say there's always more fear than greed in the market. Traders capture both sides of the stocks' movement, both when it goes up, then when it drops - which is actually a lot more profitable and less risky for reasons stated above - and then when/if it recovers again.

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Day trading in a Bear market is nigh on impossible.

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Sigh... this is getting painful as your ignorance is truly astounding. Okay, to use myself as an example, I would guess that 75% of my trade is on the short side, which means I make more money and I make it faster when the stock drops.. since as I said on average stocks drop 2.5 times faster than rise, so I can be in and out quicker and on to my next trade while buy-and-holders are shaking their head and hoping it will come back sometime. It may, it may not, I simply don't care. My goal is to ride momentum, in either direction. Yes, there has been a lot of ignorant "day traders" during the dot com bubble, and yes most of them got wiped out during the bear market that followed. The real traders, however, made most of their money in the bear market that followed, and I intend to do the same in the one that I believe is coming.

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Also a bear market is imminent imo.

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If you understand that much, how can you be so thoroughly ignorant of the rest of what I just said?

Kirk