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Day Trading for a Living?

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Re: Day Trading for a Living?

#291

Post by boulos »

Macross8299 wrote: post #263
JackFr wrote: post #163

Earlier quoted context omitted.

No inside information on commodities. (However trading on embargoed government press releases is illegal. Though rather than kidnapping Clarence Beeks on the train, you can just interview the Florida farmers yourself.)

There is definitely inside information on commodities, it's just rare that insider trading on commodities is prosecuted. You would definitely have an advantage in trading oil/gas futures if you had access to ExxonMobil's seismic exploration reports, for example.

Indeed! I found Matt Levine's post last Fall [1], particularly useful, as he believed you couldn't be prosecuted for insider trading of commodities (only securities). Then he received a nastygram from the CFTC :).

[1] https://www.bloomberg.com/amp/opinion/articles/2018-10-24/it...

Re: Day Trading for a Living?

#292

Post by curiousgal »

DSingularity wrote: post #51
soneca wrote: post #39

Earlier quoted context omitted.

Why weird?

Because that is not a representative sampling of the day trader population. Assuming the techniques of the study were sound, at best we can conclude whether or not day trading Brazilian futures is a sustainably profitable undertaking.

Isn't it the case for most studies that we read about online? Anything that ranges from "X can cure Cancer" to "Sleeping X hours is better for you" has a sample mostly consisting of American individuals. That doesn't stop them from generalizing nor does it make us question said generalization.

That being said, this seems like a double-standard.

Re: Day Trading for a Living?

#293

Post by [deleted] »

tim333 wrote: post #192
alexhutcheson wrote: post #161

Earlier quoted context omitted.

A business using this approach is called a Bucket Shop - it's both fairly well-known and explicitly illegal in most places: https://en.wikipedia.org/wiki/Bucket_shop_(stock_market)

It's also very similar to 'spread betting', explicitly legal in the UK and a large industry.

[deleted]

Re: Day Trading for a Living?

#295

Post by amluto »

tialaramex wrote: post #266
ummonk wrote: post #250

Earlier quoted context omitted.

I don’t think most commodities traders actually transfer or take delivery of the commodities though. Sure there are some firms that actually are engaged in the commodities business, and use the futures markets to offset price risk, but most traders in the commodities markets are basically just betting on commodities prices.

The nominal dealing on a future's market will be on some paper that entitles the holder to the commodity delivery at a future date. When you buy oil futures, you are NOT buying oil since the oil doesn't exist (well I guess it exists underground somewhere, maybe), you are buying a contract to deliver crude oil and that needs to really exist. If the contracts don't exist that's a Bucket Shop. It matters when things go…

You may be confusing the exchange with a broker. With a serious commodities broker, you’re using the services of the broker to trade on an exchange, e.g. the CME. The broker does not particularly care whether you make or lose money, so long as you don’t actually go negative.

In the US, securities brokers are very heavily regulated — see “regulation NMS”.

Re: Day Trading for a Living?

#296

Post by amluto »

voldacar wrote: post #258
amluto wrote: post #144

Earlier quoted context omitted.

> One interesting thing: they normally sell the course with a private platform to trade the stocks included. I believe that they use that platform to collect data and operate against the traders that use that platform. They know the strategy that they are going to use (because they teach them), so it is easy to operate against. You’re assuming a complex strategy is needed when a simple one can easily suffice: simply…

>If, indeed, the client is trading based on no information whatsoever, then the broker wins and the client loses. If this were the case, wouldnt both sides just make 0$ on average over a long period of time? (or whatever the avg growth of the market was during this period) I guess the broker would earn fees, but that still doesn't exactly sound lucrative

For the kind of trader that clicks on a computer all day, fees and spreads (which are not always easy to tell apart) can easily dominate price movement.

Re: Day Trading for a Living?

#297

Post by Kevin_S »

smdz wrote: post #148

That is so misleading! I have been day trading profitably for the last 6+ years. It is more than enough to cover my living expenses for a family of 4. But I also work (freelance dev), because it cannot cover my home EMIs. My returns are not too high, but much better than bank interest rates and probably much below professional traders. The only thing stopping me from earning my EMIs or more income is the allocated ca…

Ok but the last 6 years the market has generally only gone up. If you are doing technical analysis, you would expect to actually be profitable in an expansionary period. The problem is if you trade the same way in a deflationary period you will lose all of your gains.

Re: Day Trading for a Living?

#298

Post by Macross8299 »

pembrook wrote: post #274
hash872 wrote: post #267

Earlier quoted context omitted.

So then why do they trade at all then? I'm not arguing for trading, I'm just curious. It seems like the existence of 'trader' as a job at all of these financial institutions kind of disproves EMH if you have enough market data

They don't. After the Volcker rule the big banks had to close their prop trading groups: https://en.wikipedia.org/wiki/Proprietary_trading The idea that investment banks are filled with human "traders" is Hollywood nonsense. Most trading activity (and even filling of retail order flow) is now done by quant-driven funds.

Trump has undone the Volcker rule portion of Dodd-Frank [1], for what it's worth

Goldman Sachs, et al, would not lobby the government to get rid of a law that prevents them from doing something unprofitable.

[1]: https://www.politico.com/story/2019/08/20/volcker-rule-josep...

Re: Day Trading for a Living?

#299

Post by HenryBemis »

FX trader here. I do trade daily for the last 18 months, mostly algo, and it IS possible to make profit every single day. Just aim for 0.1% per day and you are set for life. You aim for the 0.1% of your capital, so when the market goes against you, you got enough margin to keep the account alive.

Anton Kreil has a good video (I will add it later - walking now) that tells the tale how the markets are set up to rip you off/apart. He mentions the 90-90-90 rule.

90% of retail traders lose 90% of their capital every 90 days. I have seen this happening so many times to retail traders who want to get rich in a week that I just stopped talking to other traders because they never learn their lesson.

Edit: Anton Kreil's video on how the system is stacked up against 'you'. He of course also sells the 'secret recipe' to win!!

https://www.youtube.com/watch?v=hzFl0uDwAQY

Re: Day Trading for a Living?

#300

Post by samfisher83 »

HenryBemis wrote: post #299

FX trader here. I do trade daily for the last 18 months, mostly algo, and it IS possible to make profit every single day. Just aim for 0.1% per day and you are set for life. You aim for the 0.1% of your capital, so when the market goes against you, you got enough margin to keep the account alive. Anton Kreil has a good video (I will add it later - walking now) that tells the tale how the markets are set up to rip you…

If you could make .1% every on the stock market that would be a return of 29% a year. I am not sure how many hedge funds could get you that kind of return.

FX is different and I guess there are differences in terms of trading days, but returning .1% every day would be very hard.

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