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Brian Massey wrote:
>Stocks are attractive because there's so many liquid markets
>available and if you can trade futures succesfully (even moderately)
>(i.e. S+P) you should be able to trade a market like DELL or INTC or
>MSFT or LU well using just Level 1 information. But I would make
>certain that the reason why a felt I wanted to switch was to reduce
>slippage and not some other more fundamental trading reason. I
>would ask myself if faster execution is really going to improve my
>bottom line.
Here's my take on a couple of points I've seen so far in this
discussion. First, the one thing I like about stocks vs. futures, and
this is purely my spin, is there is no expiration. You can't play
contango, backwardation and roll games, but that's OK by me. I never
was good at those games anyway.
Secondly, Brian wrote above, about trading DELL, INTC, MSFT, LU. In
my opinion those stocks that are the most visible and liquid are the
hardest to trade. Look at it from the standpoint of Goldman or
Merrill. If you have 10 times the volume of trades in DELL as you do
in WXYZ, wouldn't you put your best trader on DELL, and train your
greener traders on WXYZ? I would. You know they have a bigger book in
those big stocks, and more turns per day, so you know they put their
best sharks on them. They just have more exposure.
The final thing I have to add at this time is about information. When
I started SOES trading I had moved over from futures trading. I felt
in futures trading, the more info you have the better off you are. It
was hard to get rid of that idea in SOES trading. But the simple fact
was that the best traders in my shop were the ones who had no
market opinion, didn't watch CNBC, didn't read WSJ, didn't care what
the news was. They just traded stocks on momentum. It was really hard
to clear my mind, not have opinions about what should happen, and
have the discipline to let the prices solely guide me. But I became a
much better Level II trader when I did that.
Furthermore, some of the best money I made was trading stocks I had
no idea what they wer, what industry they were in, what the news
was, or anything about them other than their ticker symbol. We'd
watch New Highs/Lows after 10:30 and pick up a flyer or death-spiral
now and then and just go with the flow. And some of those flows were
huge.
I could write a book about what I've learned about Level II trading,
and the games people play. Maybe I should ; > )
Just my $0.02.
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"It's hard to make predictions, especially about the future."-Yogi Berra, Visionary, 19??
"I think there is a world market for maybe five computers."-Thomas Watson, IBM Chairman, 1943
"640 K ought to be enough for anybody."-Bill Gates, Microsoft Chairman, 1981
"With over 50 foreign cars already on sale here, the Japanese auto industry isn't likely to carve out a big slice of the U.S. m
arket for itself"- Business Week, 1958
"TV won't be able to hold on to any market it captures after the first six months. People will soon get tired of staring at a p
lywood box every night."- 20th Century Fox's Daryl F. Zanuck, 1946
"Don't sweat petty things. Don't pet sweatty things."-Anonymous
"When you are courting a nice girl an hour seems like a second. When you
sit on a red-hot cinder a second seems like an hour. That's relativity." -
Albert Einstein
Shawn Devlin
mailto:shawnd@xxxxxxxxxxxxx
http://www.netcom.com/~shawnd/shawn.html
http://www.netcom.com/~shawnd/joke.html
http://www.netcom.com/~shawnd/spar.html
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