Trading Strategy for Frogs

dara

I am not against any specific person, who the hell cares some IDs on the web. I am going to write my personal feeling about trading with my 10 years of trading experience.
Again, mine is for frogs, not trading genius or full-time traders.

1.  Day Trading is not for frogs, even experienced traders. I did DT for several years, I did not count how many trades I made per year, but I can see I paid $30K+ txn fees to Etrade each year(some year I paid 50K+), All I can say it is a waste of time and your health. It just does not worth it, period. I do not even want to argue with anyone who told me DT could earn big money, he must be lying except he is truly a genius in DT.

now is the key:
2. The best trading strategy for frogs is trading as less as possible and trading only loss possibility is low. I am not sure how to say this. for example, right now SPX is 91x, one should not make any new trade at all because it could go either up/down, even you are right on this time say you buy up, in the long run you win/loss ratio would still be 50%/50%. Instead, you should at least to wait for 94x to short a little or maybe 87x to long a little(I am not saying you should do that, what I am trying to say is that it does not worth trading at 910 at all, you just should patiently wait there.   In short, you should just try to avoid trading as much as you can.

3. Trust you instinct and trade for long term(at least pretty long term say at least 3-6months). If you keep buying/shorting then selling/covering a stock in a one/day/week/month, I bet you do not have much chance to success. I will just give some of my own trading examples:
      I shorted 2000 LFC at 106 in 2007 end, why, because I know the fucking LFC does not worth that much at all, in 2007 end, like 7 or 8 of the top 10 market cap companies are from China. How can? tell me one thing China does best in the world while other countries can not do/replace? But I did not stick my plan can covered at   9x.
      I bought LVS at 3.3 and 1.5x this year(when Duoji recommend it I l already sold) because my instinct told me that LVS should go to 10-20 very very easily because, 1. founder just bought secondary offering at $5 with $500M+, come on, 500M cash is a lot. 2. The company has many good casinos, only problem is debt high,but short term bankrupcy not good for anyone, so mostly unlikely. 3. short percentage so high and founder owns 50%+ shares, short squeeze could get it to 10+ in no days.   OK,  I did not stick to my plan again and sold it at 3.5x something and did not wait for 10+.  the difference is so huge, basically I only gain 60% but if I wait for 10+, I could gain for another 500%.  The chance to gain 500%+ may happen once in several years. But I know this could happen, but I just did not stick to the plan.
     I bought YGE at  3.x last year and my target for it was 10+ again,  it went to 5.x I didnot sell and dropped back to 3.x this march, Fuck I sold it at 5.x on April and it shoot to 15 in no time. I sensed it would go to 10+ because 1.  it has real business, not likely the little bitch companies. 2. no debt, mostly profitable. 3. high short percentage too.
   BTW, I use all my $7000 401K money to buy  5000+ shares of SINA shares in 2001 at 1.x  because I believed Internet would get popular some day in China. I am not going to tell what price I sold it(very low), all I know is that SINA was 50+ for a long time and all time high was like 70+.

Basically what I want to say is that it would not make much sense for you to do all those kinds of trades gaining 3% 5% ,10%,  They would not get you rich because in some days you will lose 3% 5%. But if you gain 500% in a trade, it will get you rich.

4. Regarding to follow Laoda, maybe it is not that bad to follow some laoda, but if you keep doing things like buy after laoda saying tomorrow market up, short after laoda saying market will down in short term.    All I can say is nobody could even be 60% right in every short, for example, how can anyone so sure next Monday is up or down.  It is really hard.  Maybe Laoda could tell you important market point, that is it.   Also many frogs would get out as quickly as some Laoda,  a frog could lose a lot once he followed a wrong suggestion from Laoda.    I am not against any Laoda, so DO NOT fucking attack me.  Even so, some so called Laoda just sux hell with their personality(I have no idea their skills because I did not see their real trading records), But the way they treat others, hoho.

5. Do not listen to all those bullshit that someone said I gain how much how much in the last 2 days, "Market to Damoon", "WSLZ". "Short crashed", "Long dead". If you are affected, you would not control the evil of your body and try to revenge or catchup asap. In the end, you lose more.

Well, it is easy to say that execution. It is true for everyone. I still could not do it by myself.  I am still thinking oh great I gain 20% in one month, if I keep doing this I will gain 300% in one year. Luck would not follow you forever.

seabiscuit

Thanks for sharing your experience.  I like what you said except for those four-letter words.

DT= chasing noise???

jeff110

ding

ybgx

swimminginstock

I am not against any specific person, who the hell cares some IDs on the web. I am going to write my personal feeling about trading with my 10 years of trading experience.
Again, mine is for frogs, n ...
dara 发表于 2009-6-27 18:29

well said. similar to my experience

ybgx

JL01

kosh

JL01

Here is a successful day trader. I fully agree to "day trading is very very hard".
http://forumserver.twoplustwo.co ... day-trading-352049/

supsucc

Good say

ajs

青蛙们的DT，大多数是给券商送银子，大多数是捡了芝麻丢了西瓜。。。楼主总结的很好，赞！！！

layschips

very good post, thank you

ybgx

1

源济

Lionking

Very good points. Thanks for sharing!

One thing I don't agree is, "The best trading strategy for frogs is trading as less as possible". I think, for frogs, sufficient trading is critical. If you don't trade in real money, you don't feel the heat. If you haven't experienced several big up-and-downs, you don't know how to calm down when pivotal point comes. So I think the more trading, the better for frogs. But keep it light, purpose is for learning, until you're comfortable enough to trade big.

暖漾

thanks for sharing!!!

pinball

15# Lionking


I think he meant, as a non-prfessional, you have the freedom not being forced to trade everyday, you can trade only when there is high winning rate (>85%).
(e.g, there are several indicators in cobrasmarketview with very high winning rate, the only problem is they do not occur frequently)

Because frogs are generally weak in dealing with positions when they got wrong. So high winning rate is really the key to protect oneself.

COS

fufu

不顶说不过去。

ice_tea

ding