My side project at the moment is day/swing trading. I started sometime in early March when I pulled my money out from the stock market and cashed in on some capital gains. Things went to hell shortly after that but I was safe waiting in cash waiting to buy back in.
Because I was sitting on about 220k in cash I decided to look into other ways to put my money to use. I realized I could probably buy massive positions in large cap stocks and scalp small 20 to 50 cents moves that happen all the time and make about $100-$300 on each trade fairly quickly.
What has also helped kicked this off for me was 0 commissions on trades. Before I would have to pay like 7 bucks per trade and even though I can still profit it’s amazing how that small cost each time created resistance in my mind.
Since March, I’ve had $12540 in winning trades and -$4476 in losses, for a total profit of $8063.77, however, probably like 90% of that has been made in the past month alone since I started out cautiously with small trades to see how my win/loss ratio was, and in the past week alone I made a $2620 profit. I am now making bigger trades with $100k+ size positions. On top of that, I’ve already reinvested my $220k cash into long term holdings so I borrow that $100k from my broker (I only have to pay interest if I hold overnight which I never do), this gives me the best of both worlds.
To be honest it all seems too easy. If I just make about $400 dollars profit a day, which is like maybe 2 or 3 successful trades, 5 days a week, that’s $2000k a week, about $96k a year, for something that only takes an hour of my time (I only focus on the first hour the market opens)
For now, I just keep reinvesting these profits into buying more stocks and as my account builds more capital I’ll feel comfortable gradually increasing my position size for day trades to make either quicker more successful trades off of smaller spreads or more profitable ones with the same size spread. We’ll see.
I don’t talk about this because no one would believe it and all the advice I find out there is stuff like “it works until it doesn’t” or “you’ll lose it all...” etc. Fuck it. When I die put my money in the grave.
would you be willing to discuss your strategy for evaluating trades/picking stocks? this is something I've been trying to get into, mostly through the options market but haven't been able to come up with a solid strategy for picking stocks
For example, on Friday I made good money on FB with several 50 cent moves. I buy 500 shares at a time, so a profit target of about $250.
I would use a sequential order to buy at a certain entry point and then it immediately submits a sell order for 50 cents higher when it fills.
My strategy is basically the poor man’s HFT.
The key is picking a good entry point. I generally watch the price action for a bit and try to spot where there’s good support and the price keeps bouncing off of. I then set my orders for that price and get as many wins as I can.
No need to take my word for it, with commission free brokers you can try it out with a single share and see how you do. Avoid paper trading IMO except for learning your trading platform UI. The fills are not realistic.
Also, avoid options. They’re garbage, low liquidity and everything is usually priced in making it more difficult to make profits. If you want to trade with leverage just throw down money in your account and use the margin power your broker gives you. In theory I can trade with up to $500k in borrowed money but I stick to about $110k or so to keep about 77% equity in my account at all times.
One thing I haven’t mastered is how to set useful stop losses. There’s time the price dips and I sell too early but if I had waiting maybe 30 minutes for things to calm down I would have made profit. Not sure what to do, I just use my best judgement. And at the end of the day, worst case I have to hold for a while at least I’m holding stock in a decent company like FB and not some worthless penny stock. That’s why I maintain the 77% equity, to avoid margin calls.
Because I was sitting on about 220k in cash I decided to look into other ways to put my money to use. I realized I could probably buy massive positions in large cap stocks and scalp small 20 to 50 cents moves that happen all the time and make about $100-$300 on each trade fairly quickly.
What has also helped kicked this off for me was 0 commissions on trades. Before I would have to pay like 7 bucks per trade and even though I can still profit it’s amazing how that small cost each time created resistance in my mind.
Since March, I’ve had $12540 in winning trades and -$4476 in losses, for a total profit of $8063.77, however, probably like 90% of that has been made in the past month alone since I started out cautiously with small trades to see how my win/loss ratio was, and in the past week alone I made a $2620 profit. I am now making bigger trades with $100k+ size positions. On top of that, I’ve already reinvested my $220k cash into long term holdings so I borrow that $100k from my broker (I only have to pay interest if I hold overnight which I never do), this gives me the best of both worlds.
To be honest it all seems too easy. If I just make about $400 dollars profit a day, which is like maybe 2 or 3 successful trades, 5 days a week, that’s $2000k a week, about $96k a year, for something that only takes an hour of my time (I only focus on the first hour the market opens)
For now, I just keep reinvesting these profits into buying more stocks and as my account builds more capital I’ll feel comfortable gradually increasing my position size for day trades to make either quicker more successful trades off of smaller spreads or more profitable ones with the same size spread. We’ll see.
I don’t talk about this because no one would believe it and all the advice I find out there is stuff like “it works until it doesn’t” or “you’ll lose it all...” etc. Fuck it. When I die put my money in the grave.