SunTrader 

Your words: 1 share? Typo I guess?

No - not a typo. That's the whole point - you can actually scale down where with ES you can't (or couldn't, until the micros). And a stock brokerage house wouldn't let you take the same level of leverage even if you wanted to.

Also - presumably you could trade low beta stocks so it could be even less risky than 1 share of SPY.

Tom1978 

My 14 year old son is always on his phone. My wife regularly confronts him with his behavior. Nowadays he says: but dad is always looking at his charts. He is doing the same...

Just take the phone away. Period. He gets it back once he earns it back. You decide what earning it back looks like.

You and your son are not equal. You can look at charts or a phone in a responsible way. You have a VERY different brain than a 14-year-old. Kids are way too impressionable and need guidance, limits and boundaries. They feel safe if these are firmly in place. They know someone is in charge. But they are going to test these boundaries BIG TIME to see if they are real. To see if their safety is an illusion or not.

PM me if you want to discuss this more. I don't want to hijack this thread but feel it was important I say something.

Ron

smtlaissezfaire 

No - not a typo. That's the whole point - you can actually scale down where with ES you can't (or couldn't, until the micros). And a stock brokerage house wouldn't let you take the same level of leverage even if you wanted to. Also - presumably you could trade low beta stocks so it could be even less risky than 1 share of SPY.

Well then you are comparing apples to ... SPY's.

Come on 1 share. Give me a break.

You could do a lot of things. Sure.

smtlaissezfaire 

Interesting. How do you figure that? For instance, based on notional value + being product indifferent: 2 ATM SPX options = 1 ES future = 10 SPY options = 1000 SPY shares. So (and this is all assuming you're trading equity indexes + not spreading to reduce risk + before MES was introduced) - how could trading 1 ES be less risky than trading 1 share of SPY? Also, if you do the math, you'll see you really need a non-trivial account to trade 1000 SPY at brokerages where you can buy an ES contract intraday for < $500 margins. But yes - I think all things are risky if you don't know what you are doing. Walking down the street can be risky, as can driving an automobile at 120mph. But clearly (aside from certain situations) you'll be more alert when doing one over the other.

Also remember, back when I started..you had to at least have $25,000.00 in an account to trade stocks. A lot of people found they would rather open a Forex account for a few hundred dollars when they were beginners. That's the big reason most people didn't start with stocks.

Please adjust your post to be more helpful and less critical. We are about being helpful not simply judging. Share your experience in a positive way.

Just explain in a helpful and useful way why you believe trading less than 100 shares at a time doesn't make sense or is unrealistic or whatever your position is exactly.

Thank you,
Mike

SunTrader 

Well then you are comparing apples to ... SPY's. Come on 1 share. Give me a break. You could do a lot of things. Sure.

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SunTrader 

Well then you are comparing apples to ... SPY's. Come on 1 share. Give me a break. You could do a lot of things. Sure.

I agree - no one is going to trade with 1 share of SPY. But my point is that trading any money with no edge is dumb - even one share of SPY.

But - then again maybe that gets to the point of this thread. Why do people trade? And why do they gamble? Are they trying to make money or are they using it as a proxy to feel significant?

You can't feel very significant if you are only making only a few bucks on SPY.

Bruce Kovner drove a cab while taking out the $3000 he had on his credit card to deposit into a trading account.

Did he gamble his life?

I think he knew what he is doing. See his net worth today.

In my opinion - and after so many years of trading and dealing with many traders - If you know your statistical outcome and the probability is positive, its a start of a businesses, not gambling/HOPE it will work out for you.

DoubleUCapital 

Bruce Kovner drove a cab while taking out the $3000 he had on his credit card to deposit into a trading account. Did he gamble his life? I think he knew what he is doing. See his net worth today. In my opinion - and after so many years of trading and dealing with many traders - If you know your statistical outcome and the probability is positive, its a start of a businesses, not gambling/HOPE it will work out for you.

You make it sound like he knew exactly what he was doing and no luck or hope was involved. You are completely disregarding the random/luck variable. Out of the millions of people who have no doubt tried the exact same thing but failed, odds are that someone in that number will have the personal characteristics that are required to trade succesfully. It was still a gamble for him. Statistics and probabilities dont tell you what will happen next even if you have a 60% chance of an event occuring, you still only have 50/50 odds going forward.

Grantx 

You make it sound like he knew exactly what he was doing and no luck or hope was involved. You are completely disregarding the random/luck variable. Out of the millions of people who have no doubt tried the exact same thing but failed, odds are that someone in that number will have the personal characteristics that are required to trade succesfully. It was still a gamble for him. Statistics and probabilities dont tell you what will happen next even if you have a 60% chance of an event occuring, you still only have 50/50 odds going forward.

In my opinion you are totally wrong in your above conclusion.

If you read Kovner bio you may find out he was not LUCKY.
The millions of wanna be traders you talk about did not put in what needed/they did but could not find an edge/were unable to control emotions required to be successful at this line of business.

If your statistics and probability shows + over long term you will be profitable 100% over time (please read a book or two about gaming theory, study statistics/probability, Monte Carlo Method of computing and why casinos are in business in the first place)

Also suggest watching Mark Douglas videos explaining the above and how to do it the right way in layman language.

Good luck or serious study and perfect execution.

DoubleUCapital 

(please read a book or two about gaming theory, study statistics/probability, Monte Carlo Method of computing and why casinos are in business in the first place)

Funny you should mention that. I am currently studying BSc (honours) economics and mathematical sciences and two modules away from attempting this years final stat exam.

DoubleUCapital 

If your statistics and probability shows + over long term you will be profitable 100% over time

This is just completely wrong. Not going to argue with you though its for you to learn. I am surprised you dont have a disclaimer warning your clients that past results dont gaurantee future results (or something to that effect). Instead you are giving out these 100% gaurantees. You should be careful with that.