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Mark Jurik wrote:
1. Is the recent surge of interest in day trading due to software, the
roaring bull market, glamorization by the media, greater personal
control over retirement accounts, all or none of the above?
3. In your opinion, what percentage of day traders routinely outperform
other investment strategies? What percentage blow out their account and
suck their thumbs?
I have been trading since 1981 and full time since 1986. Starting out
in equities and equities options and switching to commodities in 1990.
In that time, 1990 to present I have known some 15 to 20 successful
traders and countless others that were not successful. Most of the
unsuccessful traders were underfunded or inexperienced or both. I have
also seen at least two of the unsuccessful, come back with another
bankroll, this time more prepared with a greater understanding of what
it takes (psychology) to withstand the mental parts of this business. I
have also seen, what I thought was a very successful trader go down in
flames. From 1988 to 1992 he made over $2.5 million, starting out with
$48 thousand and from 1992 to present give it all back and then some.
All because he was convinced of what the market was going do, go down.
As for the increased number of day traders that seem to be creeping into
this profession, I believe that there are a number of reasons that is
occurring.
First, computers are having a great deal of impact on ones ability to
analyze data.
Second, there are a number of data sources that the average individual
can access now that 10 years ago were unavailable.
Third, there are software platforms that can now test, develop systems,
backtest data and any number of functions that could not be performed,
even as late as I started in 1981. In fact, the very first charting and
analysis package that I used was Compu-Trac back in 1984 or 1985. It
was an EOD package, but was the cadillac of the trade at the time. In
fact, I still use it along with TS.
As for the media having influence in glorifying the profession of
trading IMO it might have had some of the opposite effect. Almost every
story I have seen in the past few months have shown that day trading is
anything but easy. Most of the stories have centered around the
individuals that lost, and some considerable amounts of money.
The only other aspect of this increase in the number of day traders
seems to be coming from these brokeages firms that open up these
shoppes, so to speak, that allow underfunded individuals to come in and
use the firms data feed, computers and services for a fee and begin to
trade. This to me is where most of these individuals are losing and
losing in great numbers.
Just my two cents worth.
Lamont Cranston
` "who knows what evil lurks"
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