It wouldnt all fit on one thread.Sorry






DCB, others


I have read this thread with great interest and think it is worth contribution.
If nothing else, it debunks the idea that day trading is easy, or that an
intelligent and motivated person can make money is the strange profession
without "paying tuition" in some long months (or years) of trading losses.
Remember John Urbanek? I entered this field with high expectations that
the techniques of a bull market (everone's a genius in a bull market)
would work in the new bear market that developed after he started. It
took him many months of embarrasssing losses to get a grip on a more
appropriate trading style, and I hear rumours that he is now quietly
successful.
I think that everyone needs to find the style which suits their personality.
In my case, like you, I "lack discipline" in the sense that I hate using
stop losses. How I cope with that is I buy in-the-money options. This
way, I have a limited loss, and if I am wrong about the market's direction,
then the option premium may get lost. But I do not have the risk of
unlimited or unpredictable losses. Of course, options require a different
sort of discipline. I think more work has to be put in the entry, and
somewhat less discipline in the exit when compared to stoploss trading.
This works well for me. I have been generating fairly consistent profits
for many months. (You can see some of the trades on the shorting BANKs
thread, if you are interested.)
Another trick I may mention is my "THREE POTS" system.
I divide my trading capital into three pots of capital: short term, medium
term, and long term. The Short term capital is around 5-7500, the medium
term about five times this, and the long term... ah, considerably more.
With my short term pot, I day trade, using Finspreads and other spread
bettors. This keeps me in touch with the market, and gives a fine focus
to my executions. But if I blow up, I can replenish it from the medium
or long term pots. I have had to do this once or twice already. If I
make good money, I can spend it or move it to the Medium term pot. I do
not feel obliged to trade everyday.
The Medium term pot takes positions which I manage on a few days to few
weeks time horizon. Recently, I have found that Full Moons often provide
good entry points for these positions. And hold for some or all of the
monthly cycle, may maximize results. Believe it or not, I started with
$22,000 in this pot early this year. Have pulled out over $30,000, and
still have over $50,000 left. Much of the money pulled out has gone into
the long term capital pool.
I dont look at the long term positions every day. They tend to be companies
that I have researched and where I have usually met management and am
excited about long term propects. This part of my portfolio has had some
big winner (2-baggers,3,4 and more in some cases.) It has been nicely
profitable overall.
This system causes me to develop different skills. The short term and
intrday trading requires different skills and disciplines than than
researching companies for long term investment. Interestingly, the short
term pot is the one that is least consistent in its profitability.
hi-there - 21 Sep'02 - 18:21 - 92 of 329

DCB Thankyou for the book list. I'll buy them, sit by a pool somewhere and read them. I purposely wouldn't attempt to learn every in and out for fear of not seeing the woods for the trees.
I do believe I need to learn some TA skills. However, Trading in the Zone by Mark Douglas would probably be my best investment. The reason being that I know I can consistently make profitable trades that exceed my targets etc. It's when that turns sour, which, 99% of the time is due to my state of mind, altering my decision making.
acorn1 - 22 Sep'02 - 13:48 - 93 of 329

I think DCB will be back......
Seymour Clearly - 22 Sep'02 - 15:19 - 94 of 329 edit

DCB,
I think you are too modest. This has to have been one of the most stimulating threads for a long time. I'm particualry interested in how other people trade - Perhaps other traders could outline their method of trading.
Energyi, thanks for laying out in such detail how your system works.
I am interested in developing the idea of how people trade, what they find works.

M.T.Glass,
Your way of doing things looks like the one I am aiming to achieve at the moment. You seem to be highly profitable and I take my hat off to you. I would be interested to know a bit more detail - if you are prepared to share it with us. The main reason for knowing is that the tool you use (Sharescope eod) is my principal tool.
If you'd be willing to share with us I'm sure there be a lot of interest. If you feel that you want to keep your sytem private then fair enough - I'm being cheeky asking really!
However, if you feel like it, I am wondering:
What signals are you using?
How long do you run any one trade?
How many trades do you have running at any one time?
Do you have a target for each stock or index you run a trade on, or do you simply run winners and cut losers?
Do you run close to your margin limit? (I assume that having done it for long enough you have capital you can draw on if margin is tight).
My system is that most evenings I look at Sharescope and look for:
a) significant daily price movements, usually with volume,
b) look at the support & resistance levels, and trend, although I don't worry too much about trend - which can be an expensive mistake.
c) look at the fundamentals.
I will only buy a company's stock if I like the company, they have a low enough p/e and gearing isn't high. To this end, I will often hold the stock long term (several months) if I believe the market is undervaluing the stock. I rarely sell a stock at a loss unless I feel I've made a terrible mistake - I'd rather wait for the market to correct their mistake! However I have been very thin on stocks I have been holding this year
I then place a buy order at a price I'm prepared to buy at the following day, and when I get to work I check to see if it has executed. Once a trade has occured, I then place a limit sell order, usually at 5% above the buy price (after charges). This obviously limits profit, but I find it's easier to have a number of small profits rather than one large one, which rarely comes.
As you can tell I'm only going long, so have not had too many deals recently. My recently set up s/b account has a bit of play money in it to experiment, but as I said in one of the earlier posts in this thread, I have only used this to try & scalp the dow, with terrible results so I've given that up as a bad job, and know now that I need to look at stocks or long term index trades.
Cheers, Seymour.
Dead Cat Bounce - 22 Sep'02 - 19:12 - 95 of 329

Seymour Clearly - Why are you only going long? I spent some time this morning looking through the S&P components. I didn't find any longs but I found some cracking shorts. Surely using Sharescope should yield similar results. In a bear market, if you want to trade, you have to go short.
dcb
Mr Ashley James - 22 Sep'02 - 19:20 - 96 of 329

DCB,
How long for though?
Wars have a tendency to create severe stock market rallies, peace, ie post Vietnam War Slump created 1973/75 crash plus Oil Crisis, as indeed WW II and lead up pulled us out of The Great Depression.
I do not think now is the time to add to shorts, I think the bottom is near and time for closing shorts is near.
UK Stocks look very cheap now, USA still stuff worth shorting yes I agree, but name an overvalued stock on LSE now apart from ARM?
Best regards
Ashley
Dead Cat Bounce - 22 Sep'02 - 19:49 - 97 of 329

Ashley - I don't have access to charting on UK stocks so I can't comment, and the word "value" does not enter into a chartists lexicon I'm afraid (PLEEEEESE don't start another chartists vs fundamentalists argument on this thread).
All I'm saying is that in order to decide whether I should be looking predominantly for longs or shorts in the current week, I first check the S&P. And in my opinion, the S&P still looks bearish in a short time frame (Short = days/2-3weeks). Having thus decided that I would want to pick more shorts than longs, I then start churning through the charts. Now admittedly, I didn't look at all 500, but I saw far, far more that look bearish than bullish, thus confirming, at ground level so to speak, that the S&P as a whole is indeed still bearish. Its only one chartists opinion. As I said "value" doesn't enter into it and I could be completely wrong. But everyone has to have a trading strategy into which they fit their tactics, and looking at the general direction of the S&P over the next couple of weeks is my starting point.
Looking at the Dow, back to 1916, I cannot agree with your hypothesis about wars creating booms and slumps coming with subsequent peace. 1917 was a down year. 1918 was a bit static and 1919 was a boom. 1941 and 42 were down years 45 and 46 were booms. The Korean War from June 50 to July 53 created 2 boom years and 2 stagnant ones. 1954 and 55 were booms. The 73-75 slump was surely more to do with oil prices and the middle east than anything post-Vietnam. The Gulf war was the winter of 90/91 and 91 boomed. But hey, we are getting into the dreaded fundamentals here!!!
dcb
Mr Ashley James - 22 Sep'02 - 20:51 - 98 of 329

DCB,
IMHO Increased Defence Expenditure creates booms, ie there is an immediate kicker to industrial output and demand for goods and services falling in next reports and accounts.
This is why George Dubya wants a war for Gawd's sake (plus stealing and controlling Iraqi Oil, and making Yanks all patriotic and ignore the past stockmarket woes)
Weapons and Defence is big business in the USA, and a good reason to kill anyone getting in the way of those making bundles from War, eg JFK, RK, LD etc, etc.
The reason the USA is so wealthy,powerful today is the huge amounts it made out of WWI and WWII.
Cheers
Ashley
Seymour Clearly - 22 Sep'02 - 21:04 - 99 of 329 edit

Dead Cat Bounce
Why only long? Because I have slowly moved from a traditional broker to an execution only web broker but until recently had no facility to go short - but all that can change - which is why I got a s/b account. But I'm a creature of habit, and predominantly am investing / trading for my future, (in my mid 40's) so virtually all my money is in vehicles that only allow me to go long and are shielded from the taxman (PEP, ISA, SIPP), but I have had most of those largely in cash this year unless I saw some screaming longs - like looking for hens teeth at the moment!
It takes time to get your head round the idea of going short - I'm EXTREMELY late to the party! which is why I have been reluctant to put a lot of money into the s/b account yet. So this is why I am asking for people's advice and techniques etc. The s/b acount will solely be used for going short - I don't need any more long facilities!
The fact is that I am cautious by nature, and only prepared to take on something like margin if I know exactly what I'm doing, what my risk is, and can I cover it if needed. I probably sound like an old fuddy duddy, but compared to a lot of friends who are private investors, I think / hope I am ahead of them by a big margin in my level of learning and knowledge of the market - thanks largely to the friendship and help of the folk on ADVFN PBB.
Seymour.
smileypete - 22 Sep'02 - 23:12 - 100 of 329

DCB,
As you have mastered paper trading but not trading at much higher stakes perhaps you should start trading at 1/pp, then gradually work up from there.
Pete.
Dead Cat Bounce - 23 Sep'02 - 08:37 - 101 of 329

Smileypete - you can only trade at 1/pt using a spreadbetter or CFD account. It is virtually impossible to be profitable trading indices in a very short time frame using s/bs or cfds because of the way they skew their prices and the endless requotes
hi-there - 23 Sep'02 - 08:46 - 102 of 329

The way I'm trading cfd's this morning: I need to open a new thread " Why I should give up trading"
Scripophilist - 23 Sep'02 - 09:35 - 103 of 329

This thread is very similar to the axiom thread isn't it?
Robbb - 23 Sep'02 - 10:38 - 104 of 329

Scrip
I think axiom and dcb were rather different characters and that showed in the opening positions and subsequent thread development. Axiom seemed to me to be a bit of a tortured soul who was wrestling with a real problem with gambling but could hardly stop himself. I hope he was successful but I think he will be a bit like an alcoholic who, having just managed to stop drinking, cannot have even one drink. Just to mangle the metaphor, dcb seems to me to have decided that he doesn't like spirits but will happily stick to wine in future :-)
Regards
Rob

Kayak - 23 Sep'02 - 10:39 - 105 of 329

lol
Dead Cat Bounce - 23 Sep'02 - 11:00 - 106 of 329

Scrip - I have just re-read Axioms thread. Certainly there are similarities between what Axiom went through and what I have related, but as Robbb has so eloquently put it above, there are a lot of differences too. On this BB we are all traders and will all have gone through a very similar learning process. I have no doubt that if every member of this BB related their early trading experiences, then those stories would all have close similarities. We are, however, all individuals and how similar experiences have affected us as individuals makes everyone's story unique and interesting.
As LC said on Axiom's thread
"Limpsfield Chartist - 03 May'01 - 13:23 - 90 of 182
axiom
What you have written about your trading is nothing new - we have all been through it. And as you say, the secret to success is inside our heads."
What I have written is nothing new to many who have been through it, but it was new to me and the writing of it helped to clarify my thoughts and solidify my resolve to position trade in preference to daytrading.
What exactly is the point you want to make by saying the threads are similar?
dcb
M.T.Glass - 23 Sep'02 - 11:15 - 107 of 329

Seymour,
To call my ad hoc serendipitous approach a system would be to insult those who have carefully and painstakingly constructed a proper one. I feel a bit like a cook who somehow gets away with not using scales. A pinch of this, a dash of that, a handful of whatever, baked for a minute or two, or three, or four, and voila! Most times it works. Occasionally it's a turkey.
A quickly slaughtered turkey of course.
I will come back and answer your specific queries though. Bit busy away from screen this morning.
Regards
MTG
Seymour Clearly - 23 Sep'02 - 11:45 - 108 of 329 edit

MTG, thanks - sounds a bit like my "system" really!
Scripophilist - 23 Sep'02 - 15:11 - 109 of 329

DCB, No direct comparison intended it was more the style that caught my eye. Also yours was a very honest thread and one that should merit attention.
It's interesting really as I have met many similar stories over the years, it took me a while to find a style that suited me and I still use the same approach now in all markets. A lot of people never find something comfertable.
You always need to work hard to arrive at a philosophy. Also the survivorship basis is a poor way to judge success in any market.
mg - 23 Sep'02 - 15:30 - 110 of 329

dcb
Excellent post and IMHO you have your experience and axiom had his. The only comparison is that you have both shared them.
Exactly where do/did you find the time for Golf ???
My motivation for - eventually - getting my rhythm, is a balance in my life - 1/3 work, 1/3 trading and 1/3 leisure. The danger - in my experience - is that one or the other takes over - and the battle is on to stand back and review. Just what you seem to have done on Plans A, B, C, and D. Oh that we could all get it right first time.
But "there is no such thing as failure - only feedback" - it's just that some of us seem to need a lot of feedback before we get the rhythm that suits us best - even if it's doing something completelely different.
Loadsa respect - and it's about time we spent some more time together on the Golf Course ;)
Malcolm
Dead Cat Bounce - 23 Sep'02 - 15:51 - 111 of 329

Malcolm - many thanks for the post. I regret to say that I have given up golf! My son, who is 12, plays rugby for his school. Every Saturday they have matches and two evenings a week they have training. That only leaves Sundays and as I'm sure you know, you can't maintain any level of skill at golf without practice, so rather than see my game go to pieces, I stopped playing. The only exercise I get now is moving the mouse around my desk :-(
Maybe I'll start playing again after he has left school, although the zimmer frame will probably restrict my swing a bit.
regards
dcb
mg - 23 Sep'02 - 16:59 - 112 of 329

dcb
Not impressed - balance, balance, balance - don't forsake something (which I know you love) as a result of others - even if it's your son.
NO - just re-read that - I'm throwing my "map" on to you - I, equally, have not played the game that I love - at the same sort of frequency that I SHOULD - because of domestic reasons. BUT, I still play the game - FOR FUN - regardless of whether I win or lose - I - repeat I - enjoy it. My wife hates it (a long story) because she loses control of me for about 5 hours .......
I very rarely play Medals - so I'm a great bandit - but I've learnt that the TASK/COMPETITION isn't really why I do it. It's Zen like - some people work out in the gym (and if they're like me they often don't enjoy it - BUT - have to do it - my emotion) - some people read books, go on long walks in the country etc. etc.
For me, Golf is part of the "me" stuff - and I know it's an indulgence - not what I SHOULD do - not what the shrink - or family etc. - tell me is right - it's what I like doing. Part of the 1/3, 1/3, 1/3 stuff.
I'm sure you've worked it out for yourself - and chosen - but, given our discussions on the very few occasions we've been on the course together - I feel/think is/was very important to you - get a feeling that it migh not be something that you've allowed to be part of the calculations about balance...
mg
(Free Consultations available - but very rare - sounds like there are all sorts of reasons to get you back on neutral Golf Course - and I've just been training at Patshull Park (GC & Conference Centre/Hotel - didn't play) - and it looks like a good place to do some mind-bending stuff with you - off scratch - I think our handicaps are about the same :))
smileypete - 23 Sep'02 - 20:12 - 113 of 329

DCB,
I'm sure you wouldn't get requotes trading indices at 1/pp, I never have on CMC spreadbet.
As for skew, this has to be due to the movement of the underlying futures price, if not then it's a good opportunity for a guaranteed profit though arbitrage.
(Does anyone get requotes trading indices on CMC, if so at what /pp?)
Pete.
Dead Cat Bounce - 23 Sep'02 - 20:26 - 114 of 329

smileypete - I have watched both spreadbet and cfd prices on the S&P index and there is absolutely no doubt in my mind that whichever company you choose to follow - they skew the prices. And I don't mean they skew them away from the cash, what I mean is they skew them away from the futures price in whichever direction they think the price is going to go. You do NOT get honest pricing from them as far as index trading is concerned. And yes, if you call the changes in direction just before the spreadbetters do, then you can do very well. But if you are that good at calling bottoms and tops, you would do brilliantly anyway.
As far as I can tell though, they do not seem to skew stock prices, although I haven't been watching that long and I have given up my realtime feeds now, so I can't double check. But trading on a 2 - 10 day time frame, the odd few cents doesn't really matter.
dcb
MrWonderful - 23 Sep'02 - 21:18 - 115 of 329

Scripophilist-
We met at last years xmas do,i seem to recall you saying that in your opinion you did not believe one could make it as a day trader(ie,trading in the very short time frame mins and maybe hours) in the long run.
Did i hear you correctly or was it the booze effecting my hearing?
regards
glenn
Scripophilist - 23 Sep'02 - 22:15 - 116 of 329

I probably said something like that. Very difficult to compress knowledge into one sentence. There are certainly some immense barriers to overcome to avoid the risk of losing.
I'm close to finishing a big project at the moment which will be very interesting reading for a lot of traders. I couldn't find anything published on it so decided to embark on a project for myself. Generally attend most of the social events so happy to talk then. Away this week in Ireland so unable to make the event this week.
theape - 23 Sep'02 - 23:45 - 117 of 329

DCB.
cmon over to DRO9 on the FBB.
the home of the position trader (bear).
read it and form your own opinion. (I only ever lose going long).
M.T.Glass - 24 Sep'02 - 00:37 - 118 of 329

Seymour, answers to your questions earlier:
- What signals are you using?
My default s/scope chart is an 18 month cp line, with 3 simple MAs 20,60,200, a sector line, one simple RSI(20) and an equally crude MACD 13,26(9). (Note: those are mostly s/scope defaults settings which I was too lazy to adjust and have become familiar with. Not ones necessarily best suited). Secondary charts for longterm, and for daily candles. I toggle between linear/semilog, and zoom in, just looking for anything that catches my eye. Sup/res levels, familiar patterns, whatever. No sophisticated assessment or adjusted settings. But this is often in addition to observations made by other BBers whose leads I treat the same way. I skim through s/scope charts, having eliminated FTSE100 and sub-50k stocks. Where L2 or news strongly suggests imminent favourable movement I might double or treble my stake initially to bank some immediate gain, and then reduce. All bets by phone.

- How long do you run any one trade?
Cantor offer near week, far week, near quarter or far quarter. About half my bets are typically quarterlies, half weeklies. Occasionally I exit same day, quite often same week, most frequently the following week. Occasionally I might roll over to week 3, or to far quarter. I guess I hold far more positions overnight or over weekends than most sensible people would dare do, especially as I don't use automated stops..

- How many trades do you have running at any one time?
Typically 15-20. Max so far 35. Sometimes as few as 5. In August I was mostly away and didn't trade but had a couple of ongoing quarterlies.

- Do you have a target for each stock or index you run a trade on, or do you simply run winners and cut losers?
I play it by ear, but I do cull losers. I have an overall target of how much I want to bank per week, and I open sufficient positions to generate the gains to do that, rather than having a set target level per stock. Of 20 bets closed in the first 3 weeks this month 17 wins made almost 4k, 3 losses cost me in total just under 500. I am happy with that overall ratio but less happy with the ratio of win size to loss size. I don't do indices.

- Do you run close to your margin limit? (I assume that having done it for long enough you have capital you can draw on if margin is tight).
Assumption correct. Started from zero with a credit account but good cushion now.

I know I have stacks more to learn (eg making proper use of more suitable indicator settings, and maybe a more formal risk/reward approach) and will do so sometime. But meanwhile happy ploughing my own furrow at my own pace. I don't buy papers/mags/newsletters and don't send for company reports. I source everything online. No software except eod s/scope.
Regards,
MTG.

dondee - 24 Sep'02 - 00:47 - 119 of 329

DCB
Just read your story here. Great reading. You should take up writing, seriously. You have a way with words.
I will plough through the rest of the posts in due course.
DD
whitehawk99 - 24 Sep'02 - 01:17 - 120 of 329

D E A D (Not) C A T
Your so close and so very close.
Why?
Only the best traders choose Futures _ the S+P mini's are becoming the most traded futures and are now tradable 24 hours a day.
What makes trading these better than stock's? Futures go UP + Down. They are influenced by news + volume. Unlike stocks that are have many factors that affect them, sectors volume,badnews/good news...... Futures are great for day trading.
How do you trade them? The pro's use IB _ fools use Spreadbetting firms like CMC. If you look at IB (www.interactivebrokers.com) and look at comm free CMC your freak. Spread is huge,also price is very very bad. To trade something you must have the most fastest close to the price killer broker to execute your price ----
This is number 1
Number 2 -
Direction - what direction is the S+P going? Up or Down? If your looking at static charts and they say this and that and your confident of your research your type in your price and you execute through CMC. The price real time is a full-time buck behind CMC ... the market swings and we are heading south...your stake was north and as CMC ride the price way below the real price your in deep trouble. Your charts didnt say that we are going south ... on my what a mess.
Mmmmm must say I have been there many many times and the fustration loss of confidence is quite disturbing. Yet think again...what have you been reading how can anyone write a book that tells you how to get 100% winning trades, if they do they are lieing. 90% of traders lose
The markets need that 90% _ yet some are winning (10%) who are these 10% Id say the big money. No one in their right mind day trades FTSE-100 stocks as the brokers that do have multi-pound million software_these will outwit you so fast your eyes will join and your hand will get stuck deep inside your throat.
Now trade futures and you think these guys sit around reading static charts "mmmm its looking over-sold im smart" These guys see the direction and trade it and make money. If you cant see where you want to trade then yes 'STOP' and get out before you are wiped out. Ive been trading Futures for a while and may have something for you if yout interested, trading blindly will cause you bad health, bad wealth ;-)
Off to bed hope I made a little sense, please mail me Id be happy to share some more matt@gimme5.com



Dead Cat Bounce - 24 Sep'02 - 09:06 - 121 of 329

whitehawk - thanks for your thoughts but I think you have misread my original post. I did use the very best real time charting (see the bit above about getting bigger better faster software) and a real US broker. The problem is in my head, not in the speed of execution or the accuracy of my charts.
M.T. Glass - brilliant. I hope we can meet up at one of the advfn events. I'd love to chat.
dcb
Mega-Bucks - 24 Sep'02 - 09:48 - 122 of 329

D C B & M.T.G
Great posts you guys i think it is one of the best threads on the board.
Rick...M-B
Enjoy your day to the full you only live once....
REDYBREK - 24 Sep'02 - 10:03 - 123 of 329

Hi all, have read this thread and can't believe how close an affinity i feel with dcb's experience. i only survived my initial 18 months learning to trade by strictly limiting myself to 1/point. like most i tried to do the 'dow' thing and failed, don't touch it now but do trade the ftse100 index with increasing success - and it's a lot more relaxing (i have finger nails again !!)
i wish you luck with your new style dcb...if nothing else i'm sure you will get back some sanity (not that i'm saying you're insane you understand !)
MT. GLASS
before i go i have a quick question for you if you could oblige...i read your post re. sharescope which i have just started to use. have i understood correctly that you don't trade ft100 stocks ?. if so , what is the reason for that ? . thank-you in anticipation Gary
M.T.Glass - 24 Sep'02 - 11:01 - 124 of 329

Gary,
Partly practical reasons; partly psychological. I'm instinctively more comfortable fishing alongside the mainstream rather than in it. At present I don't have a facility to take best advantage of SETS system anyway, and have not yet got myself trained in that area. One day I might. Some top stocks move into line with events/news/opinion quicker than my mind works. I prefer stocks out of the limelight where there's sometimes a bit of a time lag in prices reacting, and I have time to get my eye in. I do occasionally make bets on a FTSE stock or two (currently short BOOT(541.5p),HNS(379.1p on a reduced stake),RSA(118p).
mtg
Seymour Clearly - 24 Sep'02 - 12:51 - 125 of 329 edit

MTG
Many thanks for taking the time and trouble to post those answers. It is a great help to me just to get a feel for what other folks do. I do lots of reading but can't afford the time for courses unless they're very close by. GNI keep ringing me up (once gave them my number) but that's a step too far at the moment.
I agree with Rick (Mega-bucks) that this is one of the most informative threads on the board. (Are you doing this full time yet Rick - you were thinking about it last time we spoke in Darlington).
I intend to start using my account in earnest and generate some profit instead of letting the dow eat it all up quickly! Despite what I may have posted about trading indices etc earlier, I'm thinking that was not one of my wisest moves.
Seymour.
bonsai - 24 Sep'02 - 14:47 - 126 of 329

DCB
did you read Alexander Elders article about Alcoholics Anonymous meetings ?
sounds to me as though it may be relevant to what you have been saying.
Its in his book "Financial Trading - How to trade successfully for a living"

Aquila - 24 Sep'02 - 15:35 - 127 of 329

DCB - just read the thread title not the contents...who going to provide liquidity now ?
Whatever you are up to good luck, best regards, A@inahurry!.com
mab - 24 Sep'02 - 16:58 - 128 of 329

dcb..no advice intended but.
"The problem is in my head" ......
try these for a bit of behaviour re-framing.
http://www.inspiritive.com.au/change.htm
http://www.nlpu.com/Patterns/pattern2.htm
it seems a shame that you have put so much effort and time into something you wanted to do and have backed down now. maybe you are closer to your dream than you think...did you use pivot points in your spx trading? if not backtest 20 days of data and you'll be amazed at there usefulness. they are THE killer app when it comes to spx futs imo
DP = (H + L + C ) / 3
R1 = 2 * DP - L
S1 = 2 * DP - H
R2 = DP + (R1 - S1)
S2 = DP - (R1 - S1)
good fortune


Limpsfield Chartist - 24 Sep'02 - 17:04 - 129 of 329

Did I miss something here - all dcb says is he is moving out a time frame re:trading, not knocking it on the head altogether. A few posts have suggested failure/admission of defeat. I think we all have to find a style of trading that suits us and this is a process of elimination. I lose money short term trading UK stocks. I make money longer term on UK stocks. I make money short term on US stocks. I don't make much money considering the amount of effort i put into day trading the S&P. So I mainly short term trade US stocks. I think DCB has gone through a similar thought process and I commend him.
indalo - 24 Sep'02 - 17:29 - 130 of 329

Great STORY DCB,
I too am of the opinion that my brain simply isn't built for daytrading...
I look to catch moves of 25%+ over timeframes upto several weeks...It works best when I look at the screen LEAST!
I've just been on holiday and returned to find all my bets well in the money. If I had been watching every day, I would doubtless have closed some of them too early and missed serious profits.
Having your heart in your mouth and stomach constatntly tied in knots is not the way to trade..You'll always lose if you're scared...so I try to only take trades that I can walk away from happily without fretting and let the stops do their job if it goes wrong. It seems to be working
My last bad trade was CCH short about six weeks ago....I KNEW it was destined for 300p (and lower still IMO) and was short from 390, watched it all day for six weeks bricking myself every time it twitched, and was finally stopped out on a rally over 400p....not too costly, but it affected ALL my other trading in that period. Two weeks later the buggers are 310p!!...Typical, but the moral is, don't rade anything you're uncomfortable with..In this case, I SHOULD have used a put option, so I wouldn't need to worry about daily movements.
Stress totally messes up your trading...Don't get stressed!
lodger - 24 Sep'02 - 18:32 - 131 of 329

DCB - well done on deciding! I remember you saying many times you didn't have the temperament for short timescales, but you'd have another go... :-)
MTG - The more you explain your style the more it reads just like mine. I knew we traded the same things from the daily thread, but didn't appreciate how deep the similarities went - timescales, reasons, sharescope only, bit of this etc, mainly FT250's. The only major difference I can see is that I am often very very aggressive on certain 'dead certs' and pull out when the go against me immediately. I used to use margin to it's full degree but now like just bumping along enjoying it without too much stress.
energyi - 24 Sep'02 - 19:11 - 132 of 329

Seymour, MTG,
I enjoyed your discussion here.
Would you be willing to continue it on a new thread (SYS)?
http://www.advfn.com/cmn/pbb/thread.php3?id=2358292
Also, with MTG's permission, I would like to post your Q&A above
Icerr - 24 Sep'02 - 19:24 - 133 of 329

lc
"Did I miss something here-all dcb says is he is moving out a time frame re:trading, not knocking it on the head altogether."
I think a lot of people,who have taken the time/made the effort to post to this thread have been through a similar experience as dcb and have followed a similar route ie switch to longer time frames only to find that it was the mindset which was the problem,not the timescales.As was quoted,a trader told him that he would never be successful as his discipline was poor.Discipline improves when you start to trust yourself,start to have faith that you will always do the right thing when it needs doing.That needs a change in mindset,not timescales(necessarily!).
If dcb wants to trade longer timescales then good luck to him,I hope he finds what he is looking for.The only reason I(& others) even hinted that it might be a shame to knock the day stuff on the head was based on my own personal experience as I went through the same thing,but found the route to the problem was something not related to the actual timescale of the trade.At the end of the day dcb posted a thread on the bb which was bound to get a broad range of response due to the nature of the post and the fact that people are at different stages in the trading curve.Everyone has posted a response based on their own experiences,in some cases that means they think he is doing the right thing,others are simply offering suggestions which they think might help.
I dont think anyone hasmissed the pointin the way dcb says,people have simply tried to offer suggestions based on real & similar experiences.out of the kindness of their hearts,in their own time,no motives,no books to sell,no courses to flog,no new ventures to springboard,just good honest opinion,free of charge!,suprised your having a dig :-)
Limpsfield Chartist - 24 Sep'02 - 19:30 - 134 of 329

Icerr
I just felt that some people were viewing it as a failure when it isn't - just a different tack - but maybe I had missed something. It's my age I think..I am turning into a grumpy b***tard.
Regards
LC
Paulismyname - 24 Sep'02 - 20:34 - 135 of 329

Have just read through this thread having been aware of its existance since the weekend, needed some time to absorbe the theme.
One factor that comes across that is common to nearly all of you (including me) is that you all trade (and would wish to continue to do so in an ideal world)
If it works it must be close to the ideal way of making a living, work when you want to, from home, in your own time, no travelling (except social events) with few start up expenses other than a decent computer and Internet access.
I am fortunate insomuch as my present business (from which I derive my living) is related to the art of investing and trading so I am able to combine the two, a hobby and a paying business. However I feel for various reasons I may be approching a crossroads businesswise, the decision I need to make, (and by the year end) is should I focus on trading to earn.
I came to ADVFN almost by accident ( a SIPPP investment that the story still has to be told) and to be honest just have the odd specualtive punt on telecom stocks. I have been on one of Bullshares course and inhabit the traders thread watching and trying to learn.
Questions I have is
a) how much actual free cash as in writing a cheque would I need to realisticly make about 50k gross per annum, based on mainly trading price volume type FT100 shares
b) would I be best off with staying with my current brokers (IG for cfds and T D Waterhouse for traditional longs)
I know this sort of turns the thread around on its head but is not the world circular
Kayak - 24 Sep'02 - 20:35 - 136 of 329

I think a lot of people are doggedly trying to make their daytrading work and it is very natural for them to dislike any hint that changing tack could be an option. Hence the number of people trying to persuade poor dcb not to give up :-)
Dead Cat Bounce - 24 Sep'02 - 20:42 - 137 of 329

Icerr - nowhere have I suggested that anyone has "missed the point". In one post I suggested that someone may have misread my post when they suggested that had I had realtime software I would have done better.
I appreciate your posts and I fully understand that from where you are standing things may look different. You may think I should have persevered and if I had then I could have gone on to be successful trading in a short time frame. Certainly my trading coach said he KNEW I could be a daytrader. I actually feel that I have let him down, but nevertheless feel I have made the correct decision taking many factors into account. Not least of which is that if I could make $x daytrading with all the stress and time it involves and I could also make $x position trading with no stress and only using a fraction of the time, which is the more sensible?
In the short time which has passed since I made the decision, my wife says I am more relaxed and I also have time in the evenings now to see my children. These things are important.
However, the most important factor is that my real trading is emotionally exactly the same as my paper trading. They are both conducted in the same time frame, and it is one in which I find I work best both in trading and in life generally. I can reflect, judge and take good decisions.
Here is another analogy for you. Some people are brilliant at thinking up witty ripostes on the spur of the moment. Most people think up the witty riposte hours later. I cannot EVER think of a witty riposte on the spur of the moment but, if I may blow my own trumpet a bit, many people on the BB think I can write well. And there you have it. I can write a good piece given the time for reflection, thought and revision. Almost every post I write is re-read and altered a number of times before I ever hit the "reply" button. But I cannot EVER think up an instant witty response. I just don't have that ability. My trading is exactly the same. I really do not think that it is any longer a question of persevering (flogging a dead horse more like) but of realising one's strengths and playing to them, as well as realising one's weaknesses and rendering them powerless by conducting oneself in such a manner that the weaknesses can't manifest themselves. (A digression - it took me 5 minutes to think of that phrase - point proved :-))
You may have been where I was and gone through it to become a daytrader. You may feel that everyone can go through to become a daytrader. That may be true although I doubt it, but I have made a decision that I am happy with and that decision is to stop banging my head against the wall and instead to do something I find easier. It was probably partly ego that kept me wanting to be a daytrader. And that part of my ego has gone - a bubble burst and I'm glad of it.
You may also be right in that a lack of discipline may blight my position trading as it did my daytrading, but somehow I doubt that. The time frame of position trading allows my reason to overcome my emotions in a way that could not happen in a 1 minute time frame. I said in my first post above that fear and greed were my enemies and that everyone suffers from them and that everyone can overcome them but in different time frames. I found that I could not overcome them in a 1 minute time frame but that I can in a daily time frame. I hope I have now found a trading style with which I will be comfortable but time will tell.
dcb
My apologies for another long post. I obviously have much too much time on my hands now I'm no longer daytrading :-)
Mr Ashley James - 24 Sep'02 - 20:58 - 138 of 329
If youre Interested in Starting Trading. Read this first!
PaulIsMyName,
My personal view is trying to trade for a living with capital of less than 100,000 is that it is suicide.
There are different views on this but ten positions, say 5 long of 10k, 5 short on 10k like a hedge fund works well.
My personal view is holding positions for at least a week ie 5 days, and possibly medium term say a month ie 21 days to 89 days is optimum period from low to high or high to low.
A 50% ROE on 100k is 50k gross pa, and allows you to aim above 100% pa ROE, I aim 115% plus, and build your pot.
All IMHO, NAG, DYOR etc, etc
Best regards
Ashley

ttt.
Get it printed off!;)