re: better way to make money ... rem / arthur Hi Guys,Been...

re: better way to make money ... rem / arthur Hi Guys,

Been around for a while as you 2 guys know and I think we would all agree different strategies for different markets.

The above is what I have settled on for last couple of years and will continue with until market changes its behaviour.

Like everyone I do hold selected stocks o/nite and sometimes for days and weeks but atm these are exceptions not the rule.

As for risk / reward this is the very reason atm I trade this way.

Remy, being a options hotshot you understand to link trading to patterns you are confident of, in the current market I have confidence in nothing EXCEPT the daily cycles of buy / sell volumes triggered by o/nite movements of the US markets.
In my view short term behavourial outcomes with high degree of confidence.

As for ETO's to leverage this daily volatiliy by definition (leverage) you are increasing your risk (and increasing your reward) , being risk adverse I prefer low risk / low reward. (I think leverage is a strategy to be used in a different market , that market being more bullish, I know Rem I'm a bit of a simpleton but I know myself and am not comfortable with derivatives in this market, things happen too quickly)

You say 10k for $250 is unacceptable but with the stocks I trade I am very comfortable that risk is very low. (Remember the majority of trades are less than a day)

Arthur, I mean $10,000.

We have touched on this strategy before I think and have both agreed the stocks you trade are the key.
They fall into the profile of generally being between 20c to just over a buck, liquid and buy and sell in blocks of 10,000 (shares) so .5c movements mean something to my simple brain.

2 types here, stocks that are in a localised uptrend but long term no clear direction or stocks in a long term uptrend but experiencing localised weakness approaching support. (You know what I mean and I think we both prefer the 2nd type)

I fibbed in my 1st post about all trades being completed in a day. 1st type of stock daytrade only (eg might be say LOK) 2nd type of stock predominately day but might hold o/nite or longer (eg might be say OXR but must have floating stop)

A small group of about 7 or 8 that you are VERY familiar with. Not all will behave as predicted on opening but the odds are ONE will create an opportunity.
This is the key, an opporunity must exist otherwise you do not trade. The market must come to you not the other way around.

Couple of Observations,

Have been guilty of holding too long into the day if I deem the trade to be daytrade only, I overcome this now by immediately after my buy I place my sell at minimum acceptable profit.
ie DOW carks it, LOK down 2c on opening (say 23c) buy 50,000 then immediaely place my sell at 23.5c

You will not make big money doing it this way, you must convince yourself you are only after a low risk income supplement. I work from home so can do this.

You will never pick daily lows and highs correctly so see LOK example above re lack of greed = lack of risk.

You will constitently leave money on the table get used to it.

If you are not good at stop loss you have wasted your time reading his post.