Is Daytrading dangerous?
- Thread starter pksam
- Start date
D
I am die hard day trader. Traded in nse cash [A group company] also in niftyfut . In year 2010 i make consistent profit. My monthly profit is in double digit in % of my trading capital .so i gain confidence so i pour much more capital for trading. & also operate my friend & relative account . It is hard to believe but day trading is not even possible it is profitable business. Tons of confidence. Ounce of patience. Years of hard work . Turns in to profit nothing else than profit.
Thanks
Thanks
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Hi
I enjoyed to read this thread today and this is my personal synopsis of it.
Many of the mentioned statements have been written from different writers in this thread and I would like to say thank you to them in that way.
Here it goes :
Is Day trading dangerous ?
- c) look at the chart & deside yr entry & exit levels seeing the price,vol &pattern
d)restrict the no of counters to 2-3 max
e)watch the first 5 min ave price & after one hr see where the mkt has been trading,ie below or above the ave price majority of trades & decide the trend & take position accordingly.ie Long or short
f)study the previous charts repeatedly to interpret.It is an art more than science
g)s/l must.
- oh it is dangerous no doubt at all but then so is crossing the road .....very small children who have a tendency to just dash across without looking left or right do get run over quite often....as you grow up you learn to follow the signals and generally make it across safe.....that is the key know the rules follow them diligently but most important keep your eyes open and be deft enough to dodge that occasional drunken driver.....
- As I said in the other thread, money management puzzle cant be solved in isolation..it has to fit seamlessly into your trading plan. For every strategy I employ I know the MAE ( Maximum Adverse Excursion ) that is..how much will the trade is expected to go against me before starting to show a profit. Based on that I size my positions which is as you can see are strategy dependent.When trading discretionary, I follow the Fixed Lot Methodology that is predetermined based on the 'heat/risk' I am willing to take on an account.
- Another key method I follow is to "Trade for Zero' that is I take trades which have high probability of going in my favor as soon as possible.That frees me from the two major things that most people are worried about - being right and knowing what the markets are going to do.
- I started out as a day trader, but consistency took some time. The most important thing that has contributed to my consistency is the understanding that there are periods of non-randomness in terms of identifiable patterns, rest of the time you have to SIT ON YOUR HANDS doing nothing.Most traders are chasing prices, they want to trade every up and down probably because they have no method in the first place
- As traders, you are trading patterns not turns. I am as happy as a trader trading up moves as well as down moves. Money is made in ranges not direction.
- For most people learning to trade is like a trip to Hell. The Devil Market will torture you in every conceivable way, searching out every weakness, stretching every nerve to its breaking point. It will throw you an occasional bone to lure you deeper into the abyss only to strip off more flesh until you are a quivering shell of your former self. Once you get past that stage its a lot of fun
- Its all about how much you have trained your eyes to spot a pattern. Most of the time I can 'feel' something is going to happen even before the pattern is complete.Actually I like to compete and overrun my systems, it keeps me alert.
b/w one thing, I have coded all the patterns I look for so that makes spotting easy. I also have an intrinsic pattern stop loss for each and know the probable % move that can result based on various permutations like Time of Day, Index Correlation etc.
- To day trade successfully you have to get a feel for the price action i.e how thick is volume, how is price trading at S/R, sector correlation, index correlation, overall market sentiment etc.
- I don't use radar screen, I trade a fixed no. of symbols which are easy to track.
I just switched to eSignal feed, little slower than the Reuters feed but its fine.
- I believe any type of trading becomes profitable if done in a predetermined manner. Day trading is nothing extraordinary if done with a plan.
The funda for day-trader should be
PLAN THE TRADE AND TRADE THE PLAN....
It's not simple but if the art of discipline can be mastered enough, day-trading would serve as a profitable profession.
All in all, my answer to the thread is... NO! DAY TRADING IS NOT DANGEROUS FOR THOSE WHO KNOW HOW TO DO IT
- http://www.traderji.com/attachments...177170421-daytrading-dangerous-timeframe2.gif
- BULLS & BEARS MAKE PROFIT SOMETIMES BUT BRAINS MAKE PROFIT ALWAYS
...This is possibly true in Derivatives trading !!!
All this may sound nice,but the trader who trades knows that brains play no role although one wouldn't mind the compliment.Have a system.Enter as per the trade plan.Trail stop exits or targets achieved.Risk management is key.Discipline is vital.......brains,nah,not necessary.
- What most people dont realize is that trading offers the ability to control losses but not the profits. You cannot predict how much profit you will make but you can at the very least aim to preserve your capital base by limiting your losses.
By controlling your losses and preserving your capital base the profits will follow. Dont be concerned with how much profit you will make on any one trade. If you aim to limit your losses on each trade then the profits will follow automatically.
- Thank God brains are not necessary to trade successfully....
I had lost all hope of making it as a trader....
U have renewed my enthusiasm.....
Lacking in the brain department.....
Seriously, the less brains we use , the more objective our thinking will be, the more we use our brains, we start to second guess our signal....hmmmm... signal to buy but rsi overbought.....cnbc says range bound, so I will not buy
Compared to dumb trader....signal by system to buy....yippee I have a signal , lets buy!
Thats the way to follow the system....no using brains to second guess the system
- Couldn't agree with you more,my friend........although many would beg to differ.
The sad part is while the intelligentsia amongst us theorists,analyses,forecasts,anticipates.......the trader simply trades his system and laughs all the way to the bank.
As Tharp puts it,depends on what you want.......Do you want to be right,or do you want to make money?
Discipline,not brains,make the trader's bank acct swell.
- To make money,one has to limit one's risks and let the profits ride........to make money,one may be wrong many times but so long as losses are small,and profits allowed to run as long as possible.
If one truly wants to make money,one should give up the desire....the 'want' to be right all the time.Conversely,those whose attention is on the 'want' to be right always tend to take many small profits,and few huge losses....the exact opposite.Their batting averages are fantastic,but not their profits/losses.
Therefore,before we get confused and flustered,we need to realize that all important word "want"............can we be wrong all the time and make money.Definitely not.Can we be right most of the time and have huge losses?Yes.
- http://www.crbtrader.com/trader/v09n01/v09n01a01.asp
http://www.investorhome.com/daytrade/profits.htm
- sir, trading is a competitive sport. ever talked about law of averages to Tiger Woods or Roger Federer or Schumi?
- what is this 95% statistics? strange that so called traders constantly quote these statistics to say this is dangerous...that is bad...you will drown etc etc. do you say that only 0.5% doctors succeed? or 0.001% lawyers get a case? then why this traders. imagine, tomorrow, you deposit some money and get a license to practice law or medicine...then millions of Indians will be eligible. and these will be your stats. in reality u have entrance exams and fixed seats and entry qualifications. imagine if trading had the same criteria like medicine, will that figure remain 95%? will the potato seller and milk man think of buying stocks on their own "research" hoping to be a millionaire? if they go belly up, do you really consider that another TRADER has failed?
- ami is just a TA software with superb back testing engine, blazing speed, and if you know C/C++ you can do anything with it including writing your own plug ins for data providers (provided u have the API docs) etc. if your data provider like Rauters provide FA data, you can import to ami and manipulate it in any way. its very cheap, but as a consequence has a steep learning curve. but if u are a quant, it will be cakewalk for you. of course you can try openquant too.
- there's no need to think, just follow the price with strict money mgmt etc. ...only if you have completed thorough thinking way in advance and have your levels on hand.
- Any time frame trading if done without proper risk control is very dangerous.....and any trading if done with a proper method,set up,entry,exits and risk control is not risky at all.....most people consider day trading as dangerous because most come to this form of trading to make big money in shortest possible time. Most beginners' trading accounts will die their deaths in this form of trading.....
Day trading if done considering the above,is extremely profitable....it is being done by many....we have to think whether we are psychologically comfortable with this form of trading....and if yes,learn how it is done.....
Thanks for all your input you give to me and other traders !
DanPickUp
I enjoyed to read this thread today and this is my personal synopsis of it.
Many of the mentioned statements have been written from different writers in this thread and I would like to say thank you to them in that way.
Here it goes :
Is Day trading dangerous ?
- c) look at the chart & deside yr entry & exit levels seeing the price,vol &pattern
d)restrict the no of counters to 2-3 max
e)watch the first 5 min ave price & after one hr see where the mkt has been trading,ie below or above the ave price majority of trades & decide the trend & take position accordingly.ie Long or short
f)study the previous charts repeatedly to interpret.It is an art more than science
g)s/l must.
- oh it is dangerous no doubt at all but then so is crossing the road .....very small children who have a tendency to just dash across without looking left or right do get run over quite often....as you grow up you learn to follow the signals and generally make it across safe.....that is the key know the rules follow them diligently but most important keep your eyes open and be deft enough to dodge that occasional drunken driver.....
- As I said in the other thread, money management puzzle cant be solved in isolation..it has to fit seamlessly into your trading plan. For every strategy I employ I know the MAE ( Maximum Adverse Excursion ) that is..how much will the trade is expected to go against me before starting to show a profit. Based on that I size my positions which is as you can see are strategy dependent.When trading discretionary, I follow the Fixed Lot Methodology that is predetermined based on the 'heat/risk' I am willing to take on an account.
- Another key method I follow is to "Trade for Zero' that is I take trades which have high probability of going in my favor as soon as possible.That frees me from the two major things that most people are worried about - being right and knowing what the markets are going to do.
- I started out as a day trader, but consistency took some time. The most important thing that has contributed to my consistency is the understanding that there are periods of non-randomness in terms of identifiable patterns, rest of the time you have to SIT ON YOUR HANDS doing nothing.Most traders are chasing prices, they want to trade every up and down probably because they have no method in the first place
- As traders, you are trading patterns not turns. I am as happy as a trader trading up moves as well as down moves. Money is made in ranges not direction.
- For most people learning to trade is like a trip to Hell. The Devil Market will torture you in every conceivable way, searching out every weakness, stretching every nerve to its breaking point. It will throw you an occasional bone to lure you deeper into the abyss only to strip off more flesh until you are a quivering shell of your former self. Once you get past that stage its a lot of fun
- Its all about how much you have trained your eyes to spot a pattern. Most of the time I can 'feel' something is going to happen even before the pattern is complete.Actually I like to compete and overrun my systems, it keeps me alert.
b/w one thing, I have coded all the patterns I look for so that makes spotting easy. I also have an intrinsic pattern stop loss for each and know the probable % move that can result based on various permutations like Time of Day, Index Correlation etc.
- To day trade successfully you have to get a feel for the price action i.e how thick is volume, how is price trading at S/R, sector correlation, index correlation, overall market sentiment etc.
- I don't use radar screen, I trade a fixed no. of symbols which are easy to track.
I just switched to eSignal feed, little slower than the Reuters feed but its fine.
- I believe any type of trading becomes profitable if done in a predetermined manner. Day trading is nothing extraordinary if done with a plan.
The funda for day-trader should be
PLAN THE TRADE AND TRADE THE PLAN....
It's not simple but if the art of discipline can be mastered enough, day-trading would serve as a profitable profession.
All in all, my answer to the thread is... NO! DAY TRADING IS NOT DANGEROUS FOR THOSE WHO KNOW HOW TO DO IT
- http://www.traderji.com/attachments...177170421-daytrading-dangerous-timeframe2.gif
- BULLS & BEARS MAKE PROFIT SOMETIMES BUT BRAINS MAKE PROFIT ALWAYS
...This is possibly true in Derivatives trading !!!
All this may sound nice,but the trader who trades knows that brains play no role although one wouldn't mind the compliment.Have a system.Enter as per the trade plan.Trail stop exits or targets achieved.Risk management is key.Discipline is vital.......brains,nah,not necessary.
- What most people dont realize is that trading offers the ability to control losses but not the profits. You cannot predict how much profit you will make but you can at the very least aim to preserve your capital base by limiting your losses.
By controlling your losses and preserving your capital base the profits will follow. Dont be concerned with how much profit you will make on any one trade. If you aim to limit your losses on each trade then the profits will follow automatically.
- Thank God brains are not necessary to trade successfully....
I had lost all hope of making it as a trader....
U have renewed my enthusiasm.....
Lacking in the brain department.....
Seriously, the less brains we use , the more objective our thinking will be, the more we use our brains, we start to second guess our signal....hmmmm... signal to buy but rsi overbought.....cnbc says range bound, so I will not buy
Compared to dumb trader....signal by system to buy....yippee I have a signal , lets buy!
Thats the way to follow the system....no using brains to second guess the system
- Couldn't agree with you more,my friend........although many would beg to differ.
The sad part is while the intelligentsia amongst us theorists,analyses,forecasts,anticipates.......the trader simply trades his system and laughs all the way to the bank.
As Tharp puts it,depends on what you want.......Do you want to be right,or do you want to make money?
Discipline,not brains,make the trader's bank acct swell.
- To make money,one has to limit one's risks and let the profits ride........to make money,one may be wrong many times but so long as losses are small,and profits allowed to run as long as possible.
If one truly wants to make money,one should give up the desire....the 'want' to be right all the time.Conversely,those whose attention is on the 'want' to be right always tend to take many small profits,and few huge losses....the exact opposite.Their batting averages are fantastic,but not their profits/losses.
Therefore,before we get confused and flustered,we need to realize that all important word "want"............can we be wrong all the time and make money.Definitely not.Can we be right most of the time and have huge losses?Yes.
- http://www.crbtrader.com/trader/v09n01/v09n01a01.asp
http://www.investorhome.com/daytrade/profits.htm
- sir, trading is a competitive sport. ever talked about law of averages to Tiger Woods or Roger Federer or Schumi?
- what is this 95% statistics? strange that so called traders constantly quote these statistics to say this is dangerous...that is bad...you will drown etc etc. do you say that only 0.5% doctors succeed? or 0.001% lawyers get a case? then why this traders. imagine, tomorrow, you deposit some money and get a license to practice law or medicine...then millions of Indians will be eligible. and these will be your stats. in reality u have entrance exams and fixed seats and entry qualifications. imagine if trading had the same criteria like medicine, will that figure remain 95%? will the potato seller and milk man think of buying stocks on their own "research" hoping to be a millionaire? if they go belly up, do you really consider that another TRADER has failed?
- ami is just a TA software with superb back testing engine, blazing speed, and if you know C/C++ you can do anything with it including writing your own plug ins for data providers (provided u have the API docs) etc. if your data provider like Rauters provide FA data, you can import to ami and manipulate it in any way. its very cheap, but as a consequence has a steep learning curve. but if u are a quant, it will be cakewalk for you. of course you can try openquant too.
- there's no need to think, just follow the price with strict money mgmt etc. ...only if you have completed thorough thinking way in advance and have your levels on hand.
- Any time frame trading if done without proper risk control is very dangerous.....and any trading if done with a proper method,set up,entry,exits and risk control is not risky at all.....most people consider day trading as dangerous because most come to this form of trading to make big money in shortest possible time. Most beginners' trading accounts will die their deaths in this form of trading.....
Day trading if done considering the above,is extremely profitable....it is being done by many....we have to think whether we are psychologically comfortable with this form of trading....and if yes,learn how it is done.....
Thanks for all your input you give to me and other traders !
DanPickUp
Dear Danpickup,
Can u pl explain the Time frame concept & trading the same in more detail for intraday.what r the most frequented patterns u come across in intraday chart?
Also,in which site u see the chart with vol live.
Any suggestion on scrips based on yr experience.
In the Broker terminal,it is embarasing to ask the dealer for the chart every time as it disturbs the other people & invariably hangs the screen aswell.
Can u pl explain the Time frame concept & trading the same in more detail for intraday.what r the most frequented patterns u come across in intraday chart?
Also,in which site u see the chart with vol live.
Any suggestion on scrips based on yr experience.
In the Broker terminal,it is embarasing to ask the dealer for the chart every time as it disturbs the other people & invariably hangs the screen aswell.
Hi rangarajan
As I was writing and you read in my post at the begin :
" I enjoyed to read this thread today and this is my personal synopsis of it.
Many of the mentioned statements have been written from different writers in this thread and I would like to say thank you to them in that way."
The statement,witch belong to your question, is from this gentlemen :
http://www.traderji.com/risk-money-management/5234-daytrading-dangerous-33.html#post443789
He is the one you have to ask about it. He is the 100% day trader and he knows, what he talks about.
DanPickUp
As I was writing and you read in my post at the begin :
" I enjoyed to read this thread today and this is my personal synopsis of it.
Many of the mentioned statements have been written from different writers in this thread and I would like to say thank you to them in that way."
The statement,witch belong to your question, is from this gentlemen :
http://www.traderji.com/risk-money-management/5234-daytrading-dangerous-33.html#post443789
He is the one you have to ask about it. He is the 100% day trader and he knows, what he talks about.
DanPickUp
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