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Re: RT_GEN: Day Trading News A Crock of Crap



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<DIV>Hi RT's,</DIV>
<DIV>&nbsp;</DIV>
<DIV>here are several excerpts from this report:</DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>"Numerous market studies have concluded that accurate market timing is 
not possible, even for professional money managers. Day trading is the ultimate 
test of market timing in that the trade is opened and closed within the same 
day."</EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><FONT color=#0000ff>What a conclusion!&nbsp; The goal of day trading is not 
to time the market, but to jump on a trend and ride it.</FONT></DIV>
<DIV>&nbsp;</DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>"The day trader doesn&#8217;t know if a stock takeover is going to occur and 
cause an immediate large loss in his or her short position..." </EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><FONT color=#0000ff>Takeover and similar announcements must be made before 
or after normal market hours.&nbsp; A true day trader would have no such 
exposure.</FONT></DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>"Exhibit G shows that all of the trades held 3 days or less were 
profitable, while all trades held over three days were losses. Please note that 
all 10 long-term trades in the A26 account are losses and that A26 had a 100% 
risk of ruin when all trading was considered.</EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>An effective day trading analysis must therefore consider both the day 
trading and non-day trading conducted in each account."</EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><FONT color=#0000ff>Seems to me this proves day trading is profitable and 
short term trading is not.</FONT></DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>"The largest 1,000 share loss was $81,522."</EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><FONT color=#0000ff>What stock moved 81-1/2 points in a day?&nbsp; This had 
to be a position trade, and a person who position trades has tools including 
stops and options to prevent such losses.</FONT></DIV>
<DIV>&nbsp;</DIV>
<DIV><EM>"For example, the original A26 account had 3-day trades with all of 
them successful. The A26 trades are included at Exhibit G and illustrate the 
problem. Two of the three winning day trades were conducted utilizing INFO SEEK 
CORP on 4/24/98 for a $648.74 gain. However, another INFO SEEK CORP trade opened 
on 4/24/98 was held 40 days for a $13,863.30 loss. In fact, it is clear that the 
A26 trader is not an effective day trader, but just a poor trader who cannot 
take a loss."</EM></DIV>
<DIV>&nbsp;</DIV>
<DIV><FONT color=#0000ff>Interesting conclusion.&nbsp; It seem that A26 is a 
good day trades but a piss poor position trader!</FONT></DIV>
<DIV>&nbsp;</DIV>
<DIV>
<P align=justify><EM>"Indeed, an analysis of all the trading conducted in all 
the accounts shows that the average losing trade was held twice as long (9.53 
days), as the average winning trade (4.52 days). The average intraday trade was 
also a losing trade. In short, these public short-term traders were cutting 
their profits short and letting their losses run."</EM></P>
<P align=justify><FONT color=#0000ff>What this shows is that short term trading 
is more profitable than longest term trading.&nbsp;It is apparent that position 
trading involves more risk than day trading.</FONT></P></DIV>
<DIV>It is very apparent from this report is that day trading like any type of 
trading entails risks when not done in a disciplined manor, in fact it glosses 
over the one trader that they found out of there limited sample who was using 
proper money management and limiting his/her risk to make good money.</DIV>
<DIV>&nbsp;</DIV>
<DIV>It is further apparent it is a smoke screen to cover an attempt, lead by 
the State of Massachusetts to promote further regulation or even elimination of 
day trading firms.</DIV>
<DIV>&nbsp;</DIV>
<DIV>Today I purchased 10 OEX&nbsp;Puts at 2:24 PM EDT for 9-1/2 and sold them 
at 10.5 a few hours later.&nbsp; I made a similar trade Friday and&nbsp;Thursday 
and Wednesday and most days, some losers but mostly winners.&nbsp; I guess they 
will be after me next.</DIV>
<DIV>&nbsp;</DIV>
<DIV>&nbsp;</DIV>
<DIV>&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 
&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 
&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; Good 
luck and good trading,</DIV>
<DIV>&nbsp;</DIV>
<DIV>&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 
&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 
&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; 
&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; Ray Raffurty</DIV>
<DIV>&nbsp;</DIV>
<DIV>----- Original Message ----- 
<DIV>From: Ronald McEwan &lt;<A 
href="mailto:rmac@xxxxxxxx";>rmac@xxxxxxxx</A>&gt;</DIV>
<DIV>To: &lt;<A 
href="mailto:realtraders@xxxxxxxxxxxx";>realtraders@xxxxxxxxxxxx</A>&gt;</DIV>
<DIV>Cc: &lt;<A 
href="mailto:Realtraders@xxxxxxxxxxxxx";>Realtraders@xxxxxxxxxxxxx</A>&gt;</DIV>
<DIV>Sent: Monday, August 09, 1999 6:35 PM</DIV>
<DIV>Subject: RT_GEN: Day Trading News</DIV></DIV>
<DIV><BR></DIV>&gt; goto www.nasaa.org and 
you can read the whole 46 page report. If you want<BR>&gt; to daytrade after you 
read this "good luck"<BR>&gt; </BODY></HTML>
</x-html>From ???@??? Mon Aug 09 21:12:50 1999
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Message-ID: <37AF9441.AB57DEEC@xxxxxxx>
Date: Mon, 09 Aug 1999 21:53:53 -0500
From: Clyde Lee <clydelee@xxxxxxx>
Organization: SYTECH Corporation
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To: rl2946@xxxxxxxxx
CC: walt@xxxxxxxxx, realtraders@xxxxxxxxxxxx, realtraders@xxxxxxxxxxxxx
Subject: Re: Inside Bars
References: <49149b56.24dde8e4@xxxxxxx> <37AF6111.57E5@xxxxxxxxx> <37AF7762.43FCDF92@xxxxxxxxx>
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Status:   

Here is an update on InsideDay system with a few changes.

Look carefully.  One set of parameters give a 52% per year
return.

Clyde Lee




{
= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
System:   Inside Day    

Inputs :  None


Test inside day theory.  

Mode 0 =Buy on breakout depending on difference
        in inside day h&l to prior day h&l divided
        by the value of EntMult.
Mode 1 =Buy on breakout of high+ or Low- 14 Day ATR
        MULTIPLIED by the value of EntMult
Mode 2 =Buy on breakout of H (on uptrend defined by
        position of Close to XAverage) with stop at
        low of prior day or sell on breakout of L
        (on downtrend) with stop at prior day high.

Exit on next inside day if trade occurs.

Exit on MM stop based on multiple of 14 day ATR


= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
}

Input:    StopMult(1.5),
          EntMult(0),
					AvgLeng(15),
          Mode(0);      

Var:      Div(Iff(EntMult=0,2,EntMult)),MP(0);

Value3=AvgTrueRange(14);
MP=MarketPosition;

If currentbar > 1 then begin

  Value1=H[1]-H;
  Value2=L-L[1];
  If  Value1>0 and Value2>0  then begin
  	If Mode=0 then begin
      Buy  H+Value1/Div on Stop;
      Sell L-Value2/Div on Stop;
    End
    Else If Mode=1 then begin
      Buy  H+Value3*EntMult on Stop;
      Sell L-Value3*EntMult on Stop;
    End
    Else If Mode=2 then begin
      Value4=XAverage(c,AvgLeng);
			If C>Value4 then begin
      	If MP<=0 then Buy  H on Stop;
        ExitLong at L[1] on stop;
      End
      Else If C<Value4 then begin
        If MP>=0 then Sell L-Value3*EntMult on Stop;
        ExitLong at H[1] on stop;
      End; 
    End;
  End;

End;

If StopMult>0 then begin
  If MarketPosition>0 then
    ExitLong  at EntryPrice - StopMult*Value3 Stop
  Else If MarketPosition<0 then
    ExitShort at EntryPrice + StopMult*Value3 Stop;
End;


Rory Lewellen wrote:
> 
>      Walt,
> 
>      Have you any numbers you could share which might give an indication
> of the measure of historical success using this easy to follow rule?
> 
>      Rory
> walt@xxxxxxxxx wrote:
> >
> > Peter,
> >
> > In the case of a downtrend, enter at the low of the inside bar
> > with an initial stop-loss at the high of the preceding bar.
> >
> > Like:
> >
> > stop
> > X
> > X X
> > X X
> > X X
> > X  Entry
> >
> > Walt
> >
> > > Hi Walt,
> > >
> > > In your example, where would you enter and where would you place your stop?
> > >
> > > Regards,
> > >
> > > Peter Greco
> > >
> > >

-- 
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Clyde Lee   Chairman/CEO       (Home of SwingMachine)
SYTECH Corporation             email:   <clydelee@xxxxxxx> 
7910 Westglen, Suite 105       Work:    (713) 783-9540
Houston,  TX  77063            Fax:     (713) 783-1092    
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