119
votes
Accepted
Is trying to learn day trading a complete waste of time?
The vast majority of people that day trade lose money. Of those that make money, most aren't going to beat an index fund. Of those that actually beat an index fund, very few do so without investing ...
- 25.7k
43
votes
Why don't traders place limit orders at all prices to be first in line when the price moves?
A limit order is an order to buy or sell a product at a specific price or better. For a buy order, you might buy for lower than the limit. For a sell order, you might sell for more than the limit.
If ...
- 779
40
votes
Maker taker fees - can somebody explain in plain english?
Not sure why @Brick's answer was voted down; let me try to state it more precisely.
maker
Type 1 (seller): You tell the exchange that you want to sell at price P, but P is higher than the highest ...
- 6,047
34
votes
Accepted
How is it possible that these deep ITM stock options on DISH went from 52,000 volume, 550 open bids, 550 open asks to being completely dead overnight?
If you look at DISH's dividend history, you can see that on 20111101 DISH declared a special $2/share dividend payable on 20111201. The ex-date for that 8% dividend was... 20111115. The $2/share drop ...
- 950
30
votes
Is it unreasonable to double your investment year over year?
Yes, it is unreasonable and unsustainable. We all want returns in excess of 15% but even the best and richest investors do not sustain those kinds of returns. You should not invest more than a ...
- 429
30
votes
Accepted
What's the point of the wash rule?
The point of the wash rule is to defer (not eliminate) the tax benefit of a sale until you close out the position that you opened after realizing the loss. In your example, you closed your re-opened ...
- 129k
28
votes
What is the point of using a limit order?
I think you might be misunderstanding what a market and limit order are.
To clarify.
A market order will be executed at whatever the current price is when the trade happens. So you can't be sure what ...
- 52.9k
26
votes
Accepted
Is my algo trading illegal?
This doesn't sound like the kind of wash trading described in the Wikipedia article (market manipulation). There are many medium to high frequency trading strategies like it.
However, your trades will ...
- 8,457
25
votes
Is it unreasonable to double your investment year over year?
Yes, because you cannot have an exponential growth rate that is faster than the rate at which the economy grows on the long term. 100% growth is much more than the few percent at which the economy ...
- 541
21
votes
Why don't traders place limit orders at all prices to be first in line when the price moves?
In a reply to one of the comments, you state: "Isn't [getting the transactions filled] a good thing? Isn't that the whole point of placing an order and being the first in line? What's the point ...
- 41.5k
18
votes
What's the point of the wash rule?
The point of the wash trading rule [and similar variations in different jurisdictions] is to prevent someone from deferring gains and accelerating recognition of losses, for tax purposes.
Without a ...
- 41.5k
17
votes
What is the point of using a limit order?
Suppose we are trading a very illiquid stock of a small company. Some people are trading around a small number of shares for 10€. There are standing sell orders of a volume of maybe 2k oder 3k shares ...
- 1,613
15
votes
Accepted
Which risk did I take winning this much?
If you didn't have a stop loss set (or trailing stop loss) then an equally random spike in the other direction could have obliterated your account and put you in debt to the broker, depending on the ...
- 20.2k
15
votes
Accepted
Create a limited company to speculate with leverage
Generally I think you will find that financial institutions and other businesses are well aware that people sometimes set up limited companies with the intention, if things go bad, of walking away and ...
- 4,093
14
votes
Is trying to learn day trading a complete waste of time?
"High-frequency trading" has made day trading basically obsolete. Computer systems can take an order feed, process it through a set of algorithms, and issue an order in under a microsecond. The ...
- 1,675
13
votes
Maker taker fees - can somebody explain in plain english?
As you are asking specifically for Kraken, here is what I found:
What is Maker vs Taker?
A trade gets the taker fee if the trade order is matched immediately
against an order already on ...
- 231
13
votes
Accepted
What is the point of using a limit order?
A market order basically determines when the order is executed: as fast as possible but the price is unknown.
A limit order determines at what price the order is executed: at maximum your limit but ...
- 7,422
13
votes
Is my algo trading illegal?
From the referenced article which I have no reason to disagree with:
Wash trading is a form of market manipulation in which an entity simultaneously sells and buys the same financial instruments, ...
- 3,609
12
votes
Accepted
Can I make money daytrading?
You have already indicted in another question, titled Which risk did I take winning this much?, that you did not understand (1) Why a previous trade made you as much money as it did; nor (2) How much ...
- 41.5k
12
votes
Is the "3 bar play" trading pattern good advice?
As pointed out by Daniel Kahneman in his book, frequent stock trading is anything but Illusion of validity.
Comparing the results of 25 wealth advisers over an eight-year period,
Kahneman found ...
- 4,173
10
votes
Is it unreasonable to double your investment year over year?
"Wealth gained hastily will dwindle but whoever gathers little by little will increase it." Proverbs 13:11 (ESV)
Put another way...
"Easy come, easy go"
You cannot sustain 100% annual ROI. Sooner ...
- 2,418
10
votes
Is it unreasonable to double your investment year over year?
One thing I like to do every once in a while is look at the day's market movers. It's a list of symbols that had huge movement. There tend to be a couple of 50+% movers every time I look. In fact ...
9
votes
Why don't traders place limit orders at all prices to be first in line when the price moves?
It would make sense for an investor or trader to place a limit order in advance to close an existing position at a better price.
For new positions, traders might be less inclined to have limit orders ...
- 75.7k
8
votes
Accepted
Wash Sales and Day Trading
Great question! It can be a confusing for sure -- but here's a great example I've adapted to your scenario:
As a Day Trader, you buy 100 shares of LMNO at $100, then after a large drop the same day, ...
- 106
8
votes
If 90% trader lose money can you do opposite of what they do and make money?
No -- to quote a related answer:
The opposite of a bad strategy is not necessarily a good strategy!
The heart of the problem is that the weighting of a portfolio affects returns arithmetically, ...
- 29.4k
7
votes
How can I buy and sell the same stock on the same day?
Because it takes 3 business days for the actual transfer of stock to occur after you buy or sell to the next owner, your cash is tied up until that happens. This is called the settlement period.
...
- 20.2k
7
votes
Why did I pay a different price than the chart shows?
There's no way that anyone could know the answer. You could have been looking at the wrong chart. You could have misread the price. Perhaps the chart was correct but your virtual trader was ...
- 75.7k
7
votes
Accepted
Bought coin for $30k, sold at $40k, and buy more in $46k. Makes sense?
You only buy an investment if you think it's going up in value
You only sell an investment if you think it's going down in value (or want to cash out and don't want to risk it going down more)
So buy ...
- 129k
Only top scored, non community-wiki answers of a minimum length are eligible