The Basics of Trading

This is a discussion on The Basics of Trading within the First Steps forums, part of the Reception category; [QUOTE=vergis92]You are right, and I don't want to ever learn daytrading, I daytraded the e-mini SP500 contract and was not ...

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Old Jan 2, 2007, 3:31pm   #449
Joined Nov 2006
[QUOTE=vergis92]You are right, and I don't want to ever learn daytrading,
I daytraded the e-mini SP500 contract and was not worth the effort
even in winning months,

I'm not taking advice from anyone unless they are making 3 times
the index points I make, spend equal time , and have comparable
success rate.

And since daytrading cannot beat the efficiency of swing trading
I don't care about it,

You can all talk about the 'elite trader in oneself' and encourage all new traders
to find theirs in daytrading and lose all their money faster than ever and in vain
in the process.

most of the daytrading losers money sooner or later ends up in the hands of the longer term traders,

or do you think there's a perfect ballance of funds between winning and losing

If you can prove the statistics wrong I will sure change my mind

that's if you can answer at all...
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Old Jan 2, 2007, 3:43pm   #450
Joined Nov 2006
Originally Posted by dbphoenix
I've said nothing of the kind, but if you want to believe that I have, knock yourself out.


sorry I'm only responding to nobrainer's brief comments
he says I talk a lot, I need a dictionary etc
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Old Jan 2, 2007, 5:35pm   #451
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Originally Posted by dbphoenix
The statistics don't say any such thing. You're going by what you've been told or what you've read somewhere, not by reviewing actual studies.
Hi Dbp,
I suspect that the ol' chestnut about 90% of traders losing money is likely to surface again and again. If you have access to reliable stat's on what the true figures are, I'm sure that many peeps would be interested to review them - if you're able to provide a link. I have a sneaky feeling you've done this already elsewhere, but I couldn't think where to look, such is the size of the site!
Thanks in advance. Happy New Year everyone.
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Old Jan 13, 2007, 3:09am   #452
Joined Dec 2006
just wanted to say Thank You to FTSE Beater and TBS especially for their contributions in this thread. its nice to see people helping.
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Old Mar 17, 2007, 1:01am   #453
Joined Feb 2007
Anyone know whats happened to FTSE Beater and TBS? Guys if you are out there and reading this I just wanna says cheers for all the posts on this thread. They have been of immense help.

FB, you mentioned a long way back about preparing a document of this thread, did you ever manage to complete it?

PS. First post after a long week reading this entire thread... great stuff...
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Old Mar 17, 2007, 5:45am   #454
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I'm still breathing - just
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Old Mar 17, 2007, 1:06pm   #455
Joined Feb 2007
Hello all,

I have a great interest and would really like to get into trading. Like many, I am currently in full time employment but, unlike many, I actually like my job and don't feel the need that I want to replace it with full time trading.

Since being in full time work I can only trade outside of work hours so EOD trading seems like the best option. My first question is "Is it possible to still setup trades when the market has closed?" i.e. If for example I come home one evening, switch the PC on, check the FTSE (which has closed for the day) and see that I would like to enter long can I do that at 9pm? If not what exactly is an EOD trader? The only other option is trading on the US stock market which I beleive close at 9pm GMT.

Another question, If I have a capital of £1000 purely for trading, how much of this should I be investing at any one time in trades? I read somewhere that you should only have 1% of your capital in open trades at any one time. Is this correct?

Lastly, I just need to get my head around profit and loss... I have only ever dealt with shares and am very new to the concept of SB, futures and options. With shares I know that you won't ever make a loss unless you sell your shares below the price you bought them at. I know that with SB and Options you don't actually buy the shares. These are merely financial instruments which derive from the underlying stock you invest in. So....Let's forget Optiions for a little while as I know these are for the very experienced traders. If I had £100 that I wanted to invest in spread betting on stock X, I buy £100 of stock X at £1 (Is this the correct terminology?)... How long can I keep the trade open for? Does it cost me to keep the trade open overnight? What I am trying to get at is if stock X goes down to 90p and I have no stop loss, can't I just wait for it to go back up again before I close like with shares however long it takes or do I get a margin call?
So, purely as a mathematical example, if I did have a stop loss at 90p how much would I lose if it was hit? Also, if I closed the trade at £1.10 how much would I gain?..

I know these may seem like daft questions but I am only a newbie (a very determined one!)

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Old Mar 17, 2007, 2:35pm   #456
Joined Oct 2006
I'm no expert myself, but i'll do my best to provide some answers, and let the experts fill up on the rest that i missed out.

Depending on which SB company that you join, there is always a spread within their prices. Different firms have different spreads. The typical for the FTSE100 is a 2 pip spread.
If per se you want to trade outside hours of the LSE, it is definitely possible. But SB firms usually change the spread, usually 4 pips now.
So trading out of hours is possible, but obviously the profits are harder to be obtained.

The American markets close at 8pm as of now. 9pm when daylight saving is in effect. So depending of when you get off work, you'll have probably 2-3 hours to trade.

That being said, you can always put an order on to begin your position, which also means if you're on work when your order is hit, you can't monitor it, or look at how much you're winning/losing.

For an absolute beginner, 1% of your capital seems dead-on.

For rolling trades, i.e. the one you were explaining, about keeping trades on overnight. You need to know that when you decide to rollover the position, you pay interest to the SB company. So balance the interest vs your profits and see which will make you money.

For most day traders, leaving a position overnight isn't advisable.
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