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Don't Steal Money from Day Traders Before They Lose It

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Re: Don't Steal Money from Day Traders Before They Lose It

#211

Post by qaq »

gesman wrote: post #71

Trading is essentially an activity of showing numbers on a screen between funds deposits and funds withdrawal. Traders are playing with numbers. No one actually expects the paper shares to be mailed after stock purchase. Brokerage guarantees successful withdrawal event - and if not - then it's a present and clear fraud. So if brokerage does not actually do anything, but properly updates the numbers on the screen acco…

In this case brokerage exposes a client to counter-party risk that client has no idea about.

Re: Don't Steal Money from Day Traders Before They Lose It

#213

Post by Retric »

throwawaymath wrote: post #203
mabbo wrote: post #160

Earlier quoted context omitted.

I worked briefly[0] at a startup that helps get professional traders faster/easier access to reports, data, etc[1]. It was eye opening. Brokerage firms do huge amounts of research to help figure out where the market is going, then only give that information to the big fish who do millions/billions in trades. You and I are not competing in a fair game when we buy and sell stocks. I just keep my retirement savings in a…

I've worked in a similar role. I broadly agree: individual investors don't really have the technical skills or the capital needed to acquire and analyze the dizzying amount of data you typically need find an edge. That being said, an individual who specialized in that kind of data acquisition and analysis at a firm can do well on their own by targeting specific equities with only one or two streams of revenue. But it…

The alternative is to simply look at longer time horizons.

In the 1990 you could have beaten the market by simply realizing that the PC was going to explode into an everyday item and simply focused on buying and holding the sector vs any one stock. That's not going to see huge daily gains, but on the backs of huge successes like Dell it could easily have turned ~100k into retirement money in a decade.

Re: Don't Steal Money from Day Traders Before They Lose It

#214

Post by kolbe »

anonu wrote: post #25

I was a trader at a big bank for many years. The tools and access I had there put me in a different class of trader that very few other firms or individuals can attain. There is such information and technology asymmetry in this business - its not worth trying to day trade as an individual. Buy and hold forever... only way to invest.

Banks and hedge funds aren't always competing for the same types of profits that other market participants are. I've met some very small individual investors who generate legitimate alpha. There are myriad niches to extract outsized returns from. Even the fact that your bank was able to succeed shows this. Banks have shit technology and fundamental information, but can utilize their customers' ideas and order flow to generate alpha. That's a niche that Hedge Funds and prop shops don't fulfill.

Re: Don't Steal Money from Day Traders Before They Lose It

#215

Post by lotsofpulp »

platz wrote: post #208
mabbo wrote: post #160

Earlier quoted context omitted.

I worked briefly[0] at a startup that helps get professional traders faster/easier access to reports, data, etc[1]. It was eye opening. Brokerage firms do huge amounts of research to help figure out where the market is going, then only give that information to the big fish who do millions/billions in trades. You and I are not competing in a fair game when we buy and sell stocks. I just keep my retirement savings in a…

The problem is when everyone is simply tracking an index, there are no more humans in the loop to avert disaster.

We've had quite a few disasters with humans in the loop. And humans are still in the loop, no one is banning them from the exchanges. As long as there is an arbitrage opportunity, why wouldn't someone take advantage of it?

The only thing happening is the low value brokers/traders are being taken out of the system and automated, just like people were made redundant in other industries. But for investors who like digging in and doing their homework, opportunity is abound. Everyone else can enjoy their standard index returns to keep up with inflation.

Re: Don't Steal Money from Day Traders Before They Lose It

#216

Post by froindt »

VBprogrammer wrote: post #193
froindt wrote: post #186

Earlier quoted context omitted.

>I wonder how far down this rabbit hole things go. Do they have people standing outside factories counting how many cars leave on the back of the truck? Do they have people standing outside factories counting how many cars leave on the back of the truck? Mostly as an exercise for myself, I've been curious to make a system that would do this. Cameras on all the entrances, license plate tracking, and maintaining an "in…

Funny enough, in the last couple of days I've been wondering whether you could use computer vision in combination with sports betting to generate more accurate odds given the current state of the game. Of course the problem with that is getting up to the second video feeds (as apposed to delayed video feeds from SKY etc) from a fixed view point. I'm sure you could pay some money to get essentially a security camera f…

>I've been wondering whether you could use computer vision in combination with sports betting to generate more accurate odds given the current state of the game.

Totally unfamiliar with the gambling side of things. Do they set odds at the start of the game and maintain them throughout? There are already companies who will do live "coding" of game events to create a stream of data about the game. Players on the field, time on the field, location of the ball, location of the players, who has possession, possession by player.

There are some other trackers out there targeted for coaches. E.g. track player running speed. If they are going 10% slower than typical after the start of a play in American football, it's a good sign that they need to come out.

The common problem with your idea and mine are getting high enough quality for relatively modest prices. A standard dash cam isn't enough to grab a license plate, it'd have to be at least somewhat better tuned. Drone video from a distance is going to be tough to use to discern who is who and to get valuable info.

Re: Don't Steal Money from Day Traders Before They Lose It

#217

Post by Y_Y »

VBprogrammer wrote: post #193
froindt wrote: post #186

Earlier quoted context omitted.

>I wonder how far down this rabbit hole things go. Do they have people standing outside factories counting how many cars leave on the back of the truck? Do they have people standing outside factories counting how many cars leave on the back of the truck? Mostly as an exercise for myself, I've been curious to make a system that would do this. Cameras on all the entrances, license plate tracking, and maintaining an "in…

Funny enough, in the last couple of days I've been wondering whether you could use computer vision in combination with sports betting to generate more accurate odds given the current state of the game. Of course the problem with that is getting up to the second video feeds (as apposed to delayed video feeds from SKY etc) from a fixed view point. I'm sure you could pay some money to get essentially a security camera f…

BSkyB has a betting arm, why wouldn't they just do this with all the cameras they have?

Re: Don't Steal Money from Day Traders Before They Lose It

#218

Post by usefulcat »

speedplane wrote: post #96
mikestew wrote: post #88

Earlier quoted context omitted.

Today, it's extremely difficult to get information 5 minutes sooner than everyone else without insider trading. You're assuming parent is trading on news, information, or fundamentals. A technical trader wouldn't care about anything you've mentioned.

> You're assuming parent is trading on news, information, or fundamentals. A technical trader wouldn't care about anything you've mentioned. I don't believe it's possible to consistently make money ignoring "news, information, or fundamentals". Otherwise you're just fitting curves to noisy data. If it could work consistently, then you would be able to read the future.

If you haven't heard of arbitrage, you might want to look that up before assuming that all forms of profitable trading require knowledge of the future or inside information.

Re: Don't Steal Money from Day Traders Before They Lose It

#219

Post by celdon25 »

anonu wrote: post #25

I was a trader at a big bank for many years. The tools and access I had there put me in a different class of trader that very few other firms or individuals can attain. There is such information and technology asymmetry in this business - its not worth trying to day trade as an individual. Buy and hold forever... only way to invest.

Aren't there lesser known trading pairs that are too small in volume to be worth the time for institutions to develop and operate trading strategies for, with an acceptable risk level? I know plenty of successful individual traders, and not a single one shares your mindset.

Re: Don't Steal Money from Day Traders Before They Lose It

#220

Post by Y_Y »

froindt wrote: post #188
tomp wrote: post #183

Earlier quoted context omitted.

The problem with that is that it could be insider information (or, at least, it isn't obviously not insider information, the way info about the serial numbers from iPhones that anyone could buy is public information).

The gist I've read in the past is that basically as long as it's not obtained illegally (e.g. breaking in and stealing) and there's no benefit to the person providing the information, it's not insider trading. Matt Levine writes on the topic pretty regularly. Here's an example with a number of interesting situations. www.businesslive.co.za/amp/rdm/business/2018-02-01-matt-levine-the-fine-line-between-insider-trading-…

That would be a good way to donate to charity. Just feed info about your corporate overlord to a philanthropic trader.
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