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re: Buckle up for today's stock trading
Posted on 3/18/11 at 10:15 am to Tiger JJ
Posted on 3/18/11 at 10:15 am to Tiger JJ
quote:All trades. Not exactly sure what you mean by "hit" rate, but I've had one losing trade this year. It is included in the 67 and 28 basis points figures.
the average profit of all trades? If it's all of them, what is your "hit" rate?
quote:1-2% of total broker account assets (not "total" assets as I have financial assets outside of my broker accounts) per trade. Total stock and ETF purchases to date for day trading = $3,020,865.33.
And what % of your assets do you risk per trade?
quote:If only....
In a perfect world
1
Posted on 3/18/11 at 10:32 am to LSURussian
quote:
Not exactly sure what you mean by "hit" rate
The ratio of winning trades to total trades.
You seem to be saying you have a hit ratio of 90%+. IMO, you aren't risking nearly enough per trade (this is assuming no liquidity constraints - i.e. you aren't trading microcaps.)
Posted on 3/18/11 at 12:18 pm to Tiger JJ
quote:Yes. I've been lucky this year. Hit rate (I've learned a new term
The ratio of winning trades to total trades.
You seem to be saying you have a hit ratio of 90%+.
) = 95%+. quote:You're probably right. But I firmly believe as soon as I increase my self-imposed limit per trade, I'll just be getting greedy and I'll get burned. I'm comfortable trading the amounts I'm doing.
you aren't risking nearly enough per trade
The one big trade this year, which would probably be what you're suggesting I do more of, which worked so well for me was for a company whose quarterly results were being announced the next day. It was down 3% the day before the qtrly results so I put more than 5% of my broker assets into that one position. The next day it went down another 2%.
I doubled down.
It blew out its qtrly estimates when it announced after the market closed that day and I sold-out in after market trading.
I ended up making over 10% (1,000+ basis points) on that one flip.
Was I happy? Hell, yes!
Was I sweating blood for a few hours? HELL, YES!!!
I considered myself to be very lucky on that one. It could have gone the other way. It's just not worth the risk to me.
quote:I NEVER trade micro-caps. They are too illiquid. Just so I can have some micro-cap exposure, the only mutual fund I own is a micro-cap fund which I bought years ago.
assuming no liquidity constraints - i.e. you aren't trading microcaps.)
I do own one micro-cap stock and it is a smallish bank in the DC area. It's not for trading purposes. I know someone there and he keeps hinting that larger banks are sniffing around them for a possible purchase. Of course, he's been saying that for quite some time so..........
Posted on 3/18/11 at 4:47 pm to LSURussian
quote:
I considered myself to be very lucky on that one. It could have gone the other way. It's just not worth the risk to me.
That's why I say the ideal is to use indices. Realistically, how far down can the S and P gap in one trade?
Posted on 3/18/11 at 4:49 pm to Tiger JJ
quote:Not enough volatility for me to make it work. I've tried the S&P etf and it just doesn't move far enough, fast enough.
That's why I say the ideal is to use indices. Realistically, how far down can the S and P gap in one trade?
Posted on 3/18/11 at 6:16 pm to LSURussian
quote:
Not enough volatility for me to make it work. I've tried the S&P etf and it just doesn't move far enough, fast enough.
The flips are too small or your hit rate is much lower?
Posted on 3/18/11 at 6:38 pm to LSURussian
Maybe try flipping one of the triples? FAS/FAZ.
Or BRK-A?
Or BRK-A?
Posted on 3/18/11 at 6:58 pm to RedStickBR
I don't do those & I don't run with scissors either.
Posted on 3/18/11 at 7:02 pm to Tiger JJ
I don't think so & I don't know.
Posted on 3/18/11 at 7:13 pm to LSURussian
quote:
I don't think so & I don't know.
So you think you could flip the S and P for the same margin?
Posted on 3/18/11 at 7:28 pm to Tiger JJ
I don't know since I have not done it in years. Nothing for me to base my answer on. I don't even have it on my main watch screen.
ETA: I'm back at home now. I was at the baseball game using my iPhone so it was cumbersome to elaborate. Plus the game got exciting.
JT, most of the stocks I flip are in the $20-$50/share range. So I can buy a couple thousand of them (my minimum purchase of any security is 1K) and a 10 to 20 cent/share move gives me what I'm looking for. With SPY at over $120/share if I purchase the same $$$ amount of SPY to have a cost basis in the $40,000-$100,000 range, I need a much higher move up per share to get the same $$$ profit. If I buy 2K of SPY, I'm way over my self-imposed $$$ limit for one trade.
To RSBR, 2X & 3X leveraged ETF's just don't do it for me. I tried it one time about 3 years ago (when Col Hap suggested it on this board) and I got burned. I lost about $3K in just under 4 hours.
Warren Buffett's rule #1 for investing is "Don't Lose Money." I try to obey that rule. And to me, those leveraged ETF's are too screwy to keep overnight, especially the short ones. I'll let smarter people than me make money using them.
ETA: I'm back at home now. I was at the baseball game using my iPhone so it was cumbersome to elaborate. Plus the game got exciting.
JT, most of the stocks I flip are in the $20-$50/share range. So I can buy a couple thousand of them (my minimum purchase of any security is 1K) and a 10 to 20 cent/share move gives me what I'm looking for. With SPY at over $120/share if I purchase the same $$$ amount of SPY to have a cost basis in the $40,000-$100,000 range, I need a much higher move up per share to get the same $$$ profit. If I buy 2K of SPY, I'm way over my self-imposed $$$ limit for one trade.
To RSBR, 2X & 3X leveraged ETF's just don't do it for me. I tried it one time about 3 years ago (when Col Hap suggested it on this board) and I got burned. I lost about $3K in just under 4 hours.
Warren Buffett's rule #1 for investing is "Don't Lose Money." I try to obey that rule. And to me, those leveraged ETF's are too screwy to keep overnight, especially the short ones. I'll let smarter people than me make money using them.
This post was edited on 3/18/11 at 9:40 pm
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