Borrow Fees: What Are They And How To Calculate Them
If you believe a stock has had an overextended run to the upside, initiating a short position in it would be the ideal trade. On the logistics side on being able to short stocks, it requires a few more steps as compared to getting long stock. Aside from having a margin account, shorting a stock requires having your broker "locate" the shares for you to short -- you are borrowing someone else's shares and selling them with a promise of returning them back in the future. Stocks are classified in either 2 categories when determining shorting...
read moreThe Versatile DayTrader Goes Both Long And Short
The ideal versatile daytrader can make money in all kinds of markets -- bull, bear, or sideways. This is due to the ability of the ideal daytrader to be adept at going both long and short trading strategies. Most traders and individual investors out there only go long stocks like 99% of all mutual fund managers. And I know some very successful traders who only short stocks. Unless you are an institutional trader who is only responsible for buy-side trades or one responsible for short-side trades, it is important for all daytraders to learn...
read moreHow Do I Find Stocks To Day Trade?
During my beginning days as an equity daytrader there were many things I did to get trading ideas which I detailed in a previous blog post here. With almost two decades of real professional trading experience under my belt now, my daily routine on how I scan for stocks to trade has evolved quite a bit. As subscribers in my chatroom have noticed by now I don't publish watchlists for the next day's trading. Why? Because watchlists change all the time and from experience you usually don't trade what you plan to watch. I am not saying that...
read moreMy Beginning Days On Wall Street
Not everyone graduates college with a Finance major. I certainly did not as I studied Biology/Genetics (was a pre-med major). My favorite class I took at Cornell, and my only finance class, was Investment Management 101 during my 2nd semester senior year. That class jump-started my curiosity of Wall Street and encouraged me to forgo my earlier childhood dream of becoming a doctor. My parents paid for my college tuition so I was extremely fortunate to not have any college debt post-graduation. Straight out of college with only a Bachelor of...
read moreWhat I Did As A New Day Trader To Familiarize Myself With The Stock Market
It can be accurately said that I had little knowledge about the global financial markets when I started my job at Worldco as a newly hired proprietary equity trader. Yes I did have a small brokerage account my parents hooked me up with when I was in high school but that was about it. For people reading this who don't have a finance background or a million bucks to their name now, we are in the same boat. I started with just a fascination with Wall Street -- how you could make money out of nothing -- and wanted to give day trading a shot. Each...
read moreHow Long Does It Take A New Day Trader To Make Money?
If you are a veteran profitable daytrader, you may not have to read this. But if you are one of the many new fresh blood that are trying to learn how to daytrade this post is for you. The goal of daytrading is simply to make money! Learn how to trade the markets wisely and you can be set for life being your own boss working conveniently at home. Answer to no one except the trading gods and you will never have to pull a work all-nighter ever again. How long does it take for a newbie to make consistent money daytrading? The answer varies by...
read moreWhat Exactly Is A Parabolic Move In A Stock?
You'll often hear experienced traders say to one another "Hey, check out this parabolic move in $XYZ." What exactly is a parabolic move (aka a "para") and why is it so fascinating among stock traders? A perfect para is a steep one-directional move in a stock that looks like panic buying/selling. It is usually accompanied by rising volume which peaks at the apex/bottom, and then a sharp reversal in price direction with decelerating volume. There are many reasons why a stock may para. Some of them may be: 1) an institutional fund carelessly...
read moreWhy It’s Possible To Take Money Out Of The Stock Market Consistently Each Day
The stock market can make people filthy rich. For day traders, it's very possible to consistently make money each day. Why is that? It's because the stock market is inefficient. What does stock market inefficiency mean? It means that it takes time for stocks to accurately price to where they should be trading at. Some stocks get overbought and some get oversold -- in other words "mispriced" in relation to their true intrinsic value. One example of a market inefficiency is when I trade an extremely low volume (one that trades 500,000 shares or...
read moreInspirational Email I Received From A Trader
I had never really used Twitter before and my good trusted friend @DaytraderJM kept touting to me how TweetDeck is a great informational tool for real-time news alerts. I decided to give it a try and began posting up my trading activity and alerts on Twitter about a year ago just for fun. A year later I have gotten a nice following and you guys have given me the inspiration to start the MookTrader trading community. To my surprise one day I received an email from a Mr. C Hagan. I didn't recognize the name at first so I continued reading the...
read moreTape Reading – What Is It?
Due to the gaining popularity of technical analysis (analyzing stock charts) used by traders and investors, most daytraders these days use only their complex stock charts (aside from stock specific news) in determining when to buy or sell stock. For example, if the stock looks like it is going below the 200 moving day average, they sell. And if the stock lifts above the volume weighted average price for the day, they get long. Success at executing a profitable trade using only technical analysis is a coin toss at best in my opinion while...
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