For Those Who Watch The Stockmarkets

[Killer Bunny]

Or IFAs taking half a percent rolling commission off low yield bonds funds invested in by gullible customers

You're pejorative re low yield bonds. Love it. For UK investors US Treasuries up 35% in 13 months to end January.

[Killer Bunny]

You can really understand why people vote Tory. Out of all the possibility's of the next election which out come would drive up share the most?

Labour. Obviously!

[Killer Bunny]

If you sold everything where did you put the money?

USTs!

[Killer Bunny]

I've given up taking a view on what indices are fairly or unfairly valued (I thought houses were overvalued in 2006 - it appears that the market didn't agree).

I've taken a ten/fifteen year view that equities will outpeform bonds, and I drip my money into a basket of ETFs that is basically 15% bonds, 15% commercial property and 70% global equities. I rebalance this portfolio 6 monthly back to the target allocation and re-invest dividends.

The only thing I know for certain is that it won't prove to be the optimal strategy for the next 10 years in hindsight.......

Obviously never heard of Japan

[Killer Bunny]

200p some truly excellent points.

I'd add there are some amazingly generous tweeters. Most 'letter' services are ok but ultimately not too helpful. if you find a good one then it's a goldmine.

I know one trade tipper who makes consistently 200 points every week. Week in week out. Think about it. It's fact.

[Si1]

You're pejorative re low yield bonds. Love it. For UK investors US Treasuries up 35% in 13 months to end January.

That's interesting, but the anecdotes that prompted this were short dated uk bond funds that yield the same returns as a building society account, minus commission :-)

[thejaksie]

Honkey Show me any random time series and I can make you believe it's orderly. The problem with the market is that 364 out of 365 days it's efficient and rational.and then 1 day it's totally bizarre and irrational and will wipe out most day traders mum and pop investors with a bloom berg terminal thinking they're the dogs b*llocks. This 1 day however might come as a day or a couple or a week or a month,in a day week moth or year (s). If you've done this for 7 years that means you missed the volatility of 2007 and the crash of 2008. See how you feel when suddenly everything moves outside your lines and your invested pot is wiped out with a margin call (if levered).

[@contradevian]

Honkey Show me any random time series and I can make you believe it's orderly. The problem with the market is that 364 out of 365 days it's efficient and rational.and then 1 day it's totally bizarre and irrational and will wipe out most day traders mum and pop investors with a bloom berg terminal thinking they're the dogs b*llocks. This 1 day however might come as a day or a couple or a week or a month,in a day week moth or year (s). If you've done this for 7 years that means you missed the volatility of 2007 and the crash of 2008. See how you feel when suddenly everything moves outside your lines and your invested pot is wiped out with a margin call (if levered).

Its not about how much you can make, but how much you can loose. Have to learn risk and money management.

There are enough warnings when you open an account.

Millions enter the housing market, without a thought to how much they can loose. Property can only ever go up innit.

Edited February 28, 2015 by aSecureTenant

[bovinedealer]

Honkey Show me any random time series and I can make you believe it's orderly. The problem with the market is that 364 out of 365 days it's efficient and rational.and then 1 day it's totally bizarre and irrational and will wipe out most day traders mum and pop investors with a bloom berg terminal thinking they're the dogs b*llocks. This 1 day however might come as a day or a couple or a week or a month,in a day week moth or year (s). If you've done this for 7 years that means you missed the volatility of 2007 and the crash of 2008. See how you feel when suddenly everything moves outside your lines and your invested pot is wiped out with a margin call (if levered).

I would take issue with your comment about the market being efficient and rational; Plenty of market wizards have made money through each type of market environment and Jack D Schwager puts pay to that little academic lie in his book market sense and nonsense.

As has been stated, it's about risk mgt and under standing psychology, your own. Control the urges to chase losses and remembering the markets aren't going anywhere, means you live to fight another day.

[honkydonkey]

Honkey Show me any random time series and I can make you believe it's orderly. The problem with the market is that 364 out of 365 days it's efficient and rational.and then 1 day it's totally bizarre and irrational and will wipe out most day traders mum and pop investors with a bloom berg terminal thinking they're the dogs b*llocks. This 1 day however might come as a day or a couple or a week or a month,in a day week moth or year (s). If you've done this for 7 years that means you missed the volatility of 2007 and the crash of 2008. See how you feel when suddenly everything moves outside your lines and your invested pot is wiped out with a margin call (if levered).

Ok. I've done it a little longer than I thought then because I was buying Apple options when the market crashed and lost everything. Now i day trade, if the market crashed tomorrow I'd lose nothing and reverse to ride it down.

I invested in CAT when I was a teenager. I got out at a 12 bagger, it went up something like 40 fold before something happened and it delisted.

[longgone]

As has been stated, it's about risk mgt and under standing psychology, your own. Control the urges to chase losses and remembering the markets aren't going anywhere, means you live to fight another day.

you are a gambler ,just your tipple is different .

[Up the spout]

Another vote against day trading (i.e. it isn't for me). The problems I found were placing stops - too tight and natural market gyrations take you out, too distant and you can 'work' for 8 hours a day and lose money. That goes against every sinew of my work ethic.

Another problem with stops is - and this was with IG - I'd be watching the chart get close to my stop and then just 'dip' a pip or two and then bounce back, and carry on within a range I'd predicted, which was a bit disappointing (actually made me f'ing furious).

I did make some 'wins', not by spread betting but trading in and out of shares with short timeframes, actually during the crash of 2008; a share (usually banks) would fall like a stone and then bounce (probably short covering), and I'd get in early on the bounce and trade back out within a few hours.

As to those charts - Vodaphone and the Dax - sorry to be a party pooper and no offence intended; you could have just bought them at any time, sat on them and engaged in a full-time job at the same time. You could still use charting to select a buy-in point, even checked on a weekly basis to confirm your decision, but scalping is stressful, boring, and unprofitable unless you're betting a lot of money per point. Doesn't seem worth it, to me, especially as there's little chance of pay rises, redundancy, career progression or sick pay.

Good luck to all who try it, this is just why I don't and not to persuade anyone either way.

[honkydonkey]

Little chance of pay rises: your pay will rise exponentially when you know what to do. Not other job offers this.

Redundancy, career progression: you're not reliant on others for either, I cannot stress how nice this is.

Sick pay: don't fancy working today? Don't. No one to call, stay in bed. Use the laptop if you want to work.

[Guest_growlers_*]

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2222008

Found this paper on current valuations interesting.

[bovinedealer]

you are a gambler ,just your tipple is different .

Disagree. The difference between trading and gambling is quite clear.

A gamble is a win / lose event on a single event, where as trading or investing goes as on long as you want it to continue (unless a share is suspended), i.e. you can be down on a share only for the market to catch on to your original thesis for investing in it.

Yes we can talk about edges on both and probabilities but trading is not in the same category as gambling.

However as has been well documented with black jack you can play the probability game, well, you could, before the Casinos caught on to it.

[bovinedealer]

Little chance of pay rises: your pay will rise exponentially when you know what to do. Not other job offers this.

Redundancy, career progression: you're not reliant on others for either, I cannot stress how nice this is.

Sick pay: don't fancy working today? Don't. No one to call, stay in bed. Use the laptop if you want to work.

Yes some major upside there, as you stated before though, it's the waiting, I find boring.

Although when you do call one correctly first thing in the morning, it's great to have the rest of the day off, going for a run or a walk. Makes up for the days when there is nothing on and you spend all day fighting with it, or you take a hit. Another thing about the market is you can't hide your results, no one to blame or conversely praise but yourself for own endeavours.

[honkydonkey]

Try daytrading stock markets. They make their moves first thing so you can often be done in the first hour. The waiting isn't boring, if I'm waiting to get in I do others things on another screen, if I'm waiting to get out then ignore it, use the mobile app, go out. Have trust in your work.

Edited February 28, 2015 by honkydonkey

[Up the spout]

As I said, it isn't for all. Actually it isn't for about 95% who try. Where is there another career in which 95% of people not only fail but lose money doing it? Good for you (sincerely) for making a successful go at it, but I bring up these points to illustrate the downfalls - which I see ignored by so many posters who are bullish (pun intended) about daytrading. Even if I had been/was a successful day trader I wouldn't go say publicly how neato it is without also telling people about the negative side; I see that as being quite unrealistic and a little bit deceitful.

[bovinedealer]

As I said, it isn't for all. Actually it isn't for about 95% who try. Where is there another career in which 95% of people not only fail but lose money doing it? Good for you (sincerely) for making a successful go at it, but I bring up these points to illustrate the downfalls - which I see ignored by so many posters who are bullish (pun intended) about daytrading. Even if I had been/was a successful day trader I wouldn't go say publicly how neato it is without also telling people about the negative side; I see that as being quite unrealistic and a little bit deceitful.

You are correct, there are plenty of negatives with full time (swing or day) trading and yes, the failure rates are incredibly high. It's usually banded around that some where between 80 - 90% of people lose money. Hence it's a different mindset that's needed than in the public or even, dare I say it, the private sector.

Regarding your point about stops with IG, there is a thought in the market that the algo's are programmed to hunt for stops, i.e take retail investors out as they know what the trading and investment industry would have taught them. No one said it was fair, but that's life though isn't it?

[honkydonkey]

As I said, it isn't for all. Actually it isn't for about 95% who try. Where is there another career in which 95% of people not only fail but lose money doing it? Good for you (sincerely) for making a successful go at it, but I bring up these points to illustrate the downfalls - which I see ignored by so many posters who are bullish (pun intended) about daytrading. Even if I had been/was a successful day trader I wouldn't go say publicly how neato it is without also telling people about the negative side; I see that as being quite unrealistic and a little bit deceitful.[/size]

I completely agree. It's caused failed relationships and depression for me. It's not a subject I treat lightly.

[bovinedealer]

I completely agree. It's caused failed relationships and depression for me. It's not a subject I treat lightly.

But you are stronger now for it though, I'd hope?

[honkydonkey]

But you are stronger now for it though, I'd hope?

Yes. It's very different when it all starts working.

It's a bloody hard, expensive road though. You have to make such profound changes to your thinking it wouldn't surprise me if they translate through to your personality.

Edited February 28, 2015 by honkydonkey

[R K]

Terry Smith reckons to hold 20 to 30 shares. The more shares you hold the less you are going to know about each company. Diversifying you holding over more companies has diminishing effect by the time you get to 20 you have gained nearly all the advantages of diversification.

Although AAPL could be number 21.

Edited February 28, 2015 by R K

[bovinedealer]

Yes. It's very different when it all starts working.

It's a bloody hard, expensive road though. You have to make such profound changes to your thinking it wouldn't surprise me if they translate through to your personality.

Mmmmm, I certainly can't talk about it with family or friends. There was one when I was younger where I use to work. However upon reflection of his musings he was probably more a follower than someone actively trying to understand it. We are talking back in the late 80's so the playing field for both professional and retail investors / traders was possibly even more unbalanced than it is today I'd suggest.

[Up the spout]

You are correct, there are plenty of negatives with full time (swing or day) trading and yes, the failure rates are incredibly high. It's usually banded around that some where between 80 - 90% of people lose money. Hence it's a different mindset that's needed than in the public or even, dare I say it, the private sector.

Regarding your point about stops with IG, there is a thought in the market that the algo's are programmed to hunt for stops, i.e take retail investors out as they know what the trading and investment industry would have taught them. No one said it was fair, but that's life though isn't it?

I bet it was either the algos or ... something/someone else. Once or twice I'd put it down to bad luck but it kept on happening, I compared IG's chart to others and they didn't tally. To me it wasn't unfair it was blatant fraud. I took the easy way and pulled out pretty soon after so didn't build anywhere near enough experience to make a success of it, not something I'd usually do as I tend to stick things out too long, if anything, but it did really seem like a scam.

I've had more success betting/gambling on sports; I've never lost money on the Grand National, and won more than lost on tennis and football. The National really is pot luck but bet on a few nags each way - long and short odds - that the trainer of the winner will be Irish, that so many will finish, and a few dartboard-type guesses, and (this is key) make use of the incentives bookies give for new accounts, and you can't go far wrong. In Hong Kong (on my birthday) me and a mate clubbed together - he going for the favourites and me the three-legged donkeys - and we won enough to pay our our drinks bill. With footie I only bet on big tournaments as the gulf between teams is much larger than in the Premier League. Sometimes it works, sometimes not; I had an eight match accumulator in the 2004 European Championship, 7 came in but Germany had a crap tournament! What are the odds. I've bet on a few tennis matches, just choosing the highest rated player, and been lucky.

I know it's highly addictive and so only gamble occasionally, usually big tournos and annual events. I bought a few Lloyds shares, my average if 49p, but it was money I was prepared to lose.

I completely agree. It's caused failed relationships and depression for me. It's not a subject I treat lightly.

Very sorry to hear that. My weakness for several years when I was young was the bandits, once I started putting in rent money I sought counseling (which worked). Now I only play them on annual trips to Skegness (I have family nearby, I don't go to Skeggie for a holiday) or on holiday elsewhere. In Prague I won over a grand one very drunken night, and put it all back in (a different casino) the following drunken night.