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<DIV><FONT size=2>Is anyone using a flatfee broker, were you pay % of your
portfolio or $ 1500.00 for unlimited stock trades ?</FONT></DIV></BODY></HTML>
</x-html>From ???@??? Tue Aug 10 08:41:10 1999
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Date: Tue, 10 Aug 1999 15:24:43 +0100
From: Doug Penny <pennyd@xxxxxxxxxxxxxxxxx>
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To: RAY RAFFURTY <rrraff@xxxxxxxx>
CC: BrentinUtahsDixie <brente@xxxxxxxxxxxx>, realtraders@xxxxxxxxxxxx,
Realtraders@xxxxxxxxxxxxx
Subject: Re: RT_GEN: Day Trading News
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I think the conclusions were fairly valid. Have you ever run a risk of ruin over
your own system. Maybe some would have been profitable if less than 10% of
capital was risked on each trade but obviously they had no idea as to the real
risk
Doug
RAY RAFFURTY wrote:
> Hi Brent,
>
> They started with 30 accounts, but thru out 4 because they where traded by
> the same person, leaving 26. If you read further, 9 accounts had less than
> 30 trades and where statistically insignificant. They where thrown out,
> leaving 17 accounts.
>
> Five of the six winning accounts where thrown out because they took high
> risks, and according to them, will become losers sooner or later. Well,
> maybe, but they can not prove it.
>
> Seems to me the numbers where both manipulated and to small a sample.
>
> Good luck and good trading,
>
> Ray Raffurty
>
> ----- Original Message -----
> From: BrentinUtahsDixie <brente@xxxxxxxxxxxx>
> To: RAY RAFFURTY <rrraff@xxxxxxxx>; <realtraders@xxxxxxxxxxxx>
> Cc: <Realtraders@xxxxxxxxxxxxx>
> Sent: Monday, August 09, 1999 8:33 PM
> Subject: Re: RT_GEN: Day Trading News
>
> > >As I understand this report, it used a very small sampling of day traders
> > >from one office in Mass. It samples only 17 individuals of which 6 where
> > >making money.
> >
> > It's not quite the way Ray heard it, although the sample was small. Pasted
> > below is the info from the report.
> >
> > Brent
> >
> >
> > Analysis of Customers' Day Trading Accounts
> >
> > Thirty (30) short-term trading accounts were randomly selected for
> analysis
> > from accounts that had been maintained at the Watertown, Massachusetts
> > office of All-Tech in 1997 and 1998. Copies of customer account statements
> > had been obtained in connection with Massachusetts' proceeding against
> > All-Tech.
> >
> > The Project Group retained Erik Sikowitz of STZ Analytical Services in New
> > York, New York to tabulate account statement data and quantify trading
> > activity. Mr. Sikowitz made calculations of profits and losses;
> commissions;
> > turnover; and cost-to-equity ratios.
> >
> > The Project Group retained Ronald L. Johnson, a Securities and Futures
> > Consultant, of Palm Harbor, Florida to analyze and evaluate the trading
> > performance of the accounts. Mr. Johnson's findings and conclusions are as
> > follows:
> >
> > The average account was open four months, had an average annual turnover
> of
> > 278, and a cost/equity ratio of 56%. Six of the accounts were traded by
> two
> > individuals so four accounts were removed to avoid skewing the performance
> > analyses.
> > All trading in the accounts was analyzed and evaluated (4,093 trades in 26
> > accounts). Seventy percent of the accounts lost money and were traded in a
> > manner that realized a 100% Risk of Ruin (loss of all funds).
> > Only three accounts of the twenty-six evaluated (11.5% of the sample),
> > evidenced the ability to conduct profitable short-term trading.
> > The statistically significant day trading (2,754 trades in 17 accounts)
> was
> > evaluated. Sixty-five percent of the accounts lost money and were traded
> in
> > a manner that realized a 100% Risk of Ruin (loss of all funds)
> > There was only one successful day trading account in the 17 accounts
> > analyzed, and this account did not have trading returns commensurate with
> > the risks to which the account was exposed.
> > The most successful account in the study had limited short-term trading
> and
> > no day trading.
> >
> >
> >
> >
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