31–40 of 98 posts
So, the obvious question for me is where can I buy stocks for $2.40 per trade? Any day trading successes I might manage would be eaten up by transaction costs at my current broker (where trades are $9.95, I think). I'd probably be a far more active trader at $2.40 (which may not be a good thing, but cutting costs is always good).
I have no idea what that guy is talking about with double moving averages and what not, but I'd bet that a few simple IF/THEN statements could have produced similar results over the same period of time. Say it hand done well, would you go an invest a few thousand dollars using the IF/THEN algorithm? On a similar note, say this guy did lose his $3500. Do you think you'd be reading this post on how to automate day trad…
There are historical prices available at finance.google.com. Backtesting your strategy before playing around with real money is probably a good idea.
Heh, so this has piqued my interest. I have absolutely no experience in online investing/day trading, although I'm pretty sure a lot of you are veterans. Any books you'd recommend to a programmer with day trading aspirations?
I'd learn about finance before you learn about day trading. The Intelligent Investor - Warren Buffet's favorite A Random Walk Down Wall Street for one perspective. Mark Douglas books for a different perspective Options Volatility & Pricing for the technical stuff. And Inside the Mind of a Street Addict for the bathroom read.
Options Volatility and Pricing by S. Natenberg (sp) is a great theoretical primer for options, though typically a bit dense for people outside the industry. The writing style is brutal, but this book has probably made more millionaires than any single other book in history. Walk around the option exchange floors and every clerk has a copy, to this day.
I have no idea what that guy is talking about with double moving averages and what not, but I'd bet that a few simple IF/THEN statements could have produced similar results over the same period of time. Say it hand done well, would you go an invest a few thousand dollars using the IF/THEN algorithm? On a similar note, say this guy did lose his $3500. Do you think you'd be reading this post on how to automate day trad…
This is not always true.
I had a theory a few years ago that went like this: The price of a stock is a direct function of the perceived price of the company multiplied by a risk factor: The more risk the less the stock is worth. On the day the yearly report is publicised for a company the risk is big just before the publication because nobody knows for sure what the numbers are, and low just after the publication because everybody now knows. So according to my theory the stock price of an arbitrary company should statistically go up on the day that the yearly report is made public.
I, painstakingly, found some historical data on this (it wasn't easy) and found that it was spot on. A bit of statistical analysis showed thet there was a definite gap to be exploited.
A friend of mine showed in his Masters thesis that there were certain patterns that would almost always be present in IPO's that could be exploited if you knew them.
So there are definitely loopholes where past behaviour shows future performance, but not a lot of them.
And professional investors aren't always as smart as they're made out to be. I know a few, and hackers are a lot smarter in regard to numbers.
Heh, so this has piqued my interest. I have absolutely no experience in online investing/day trading, although I'm pretty sure a lot of you are veterans. Any books you'd recommend to a programmer with day trading aspirations?
http://www.amazon.com/Technical-Analysis-Financial-Markets-C...
I still stand by my above claim that Tech Analysis (and especially LONG term trending) has no theoretical basis, except for the fact that everyone else believes in it.
I've been thinking recently about how it would be cool to have a service which allowed you to try different trading algorithms. For instance, it would have a few algorithms built in, you could choose which you want and with what parameters and then it would monitor how it performs. Also available would be the ability to see how this algorithm would have performed in the past (to see how it worked in bad markets, etc)…
I've personally never used it. I just download raw pricing data then backtest it myself. You could learn how to do it on even yahoo data if you wanted (for day-over-day trading). Bloomberg is by far the best for intraday price information.
So, the obvious question for me is where can I buy stocks for $2.40 per trade? Any day trading successes I might manage would be eaten up by transaction costs at my current broker (where trades are $9.95, I think). I'd probably be a far more active trader at $2.40 (which may not be a good thing, but cutting costs is always good).
The cost of a ES mini (SP500 mini future) trade is $2.40.
Stocks trade for half a penny to a penny per share with a minimum of $1.00 per transaction.
I think they require 20k to start a new account these days though.
IB has been by far my favorite brokerage
http://fattyfatfat.com/2008/12/moving-average-crossover-theo...
Earlier quoted context omitted.
http://www.amazon.com/Technical-Analysis-Financial-Markets-C...
http://fattyfatfat.com/2008/10/automated-day-trader-most-tec... I still stand by my above claim that Tech Analysis (and especially LONG term trending) has no theoretical basis, except for the fact that everyone else believes in it.
Outside factors like news don't occur everyday, so the using technical analysis for intraday trading is very reasonable
Earlier quoted context omitted.
you're right. and i ran it until it started losing. I announced the day i quit running the basic moving average crossover algo. I still dabble with variations of it (made like 250 bucks last friday), but I'm now doing way more research and backtesting before I drop things into the market for real.
on that note, i lost over 1000 bucks a day for 3 days straight, which is when i quit. and on having the "secret sauce" to beat the market. Read about Edward Thorpe. He's a badass. He wrote the book "beat the dealer" which was the bible on counting cards and beating vegas at blackjack. Then he figured out how to price options (convertibles, really) and made a killing in his own hedge fund (Princeton Newport Associates…