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Discussion in 'The Cocktail Lounge' started by TomB16, Dec 15, 2022.
RIP to that one.
This is clearly a contrary position which goes against expectations. I suppose this is exactly the kind of thinking needed for large, short term, returns.
BTW, I really appreciate your input into this thread. This is some excellent content that could well bankrupt a few people but it's a great educational journey for the rest of us.
I see those contracts have expired.
You took a good shot. It could have done something good.
Because I turned $11 into roughly $1,000, I will be no longer attempting to turn @TomB16's original $600 into $400k, but I did turn it into $70k in this example (though this trade would have blown ~1/6th of that money). It would be irresponsible of me to blow this $1k of my real money though, so I'm going to sit on it for awhile. I may try a challenge again at a later date when I have more disposable income. Life is a little crazy right now though.
Disclaimer: I DO NOT recommend this strategy. I and many others have blown accounts on it.
This is exactly what you have to do to get the kind of returns you're looking for in your original joke post and why I responded the way I did. You basically have to inverse the current market sentiment and get in right before the flip. If you ever have $30 or so and decide "maybe instead of going golfing today I'll inverse the SPY on a 1 day until expiration contract, you can potentially turn it into a 1000% gainer. I did it twice in the trades above, but again, it's risky and almost always expires useless. I would not recommend doing it with any money you need, but just discretionary fun money. That random $11 I had in RH was from crypto that I miscalculated when selling it a few weeks ago before moving that money out of RH.
Proverbs 28:22 - He that hasteth to be rich hath an evil eye, and considereth not that poverty shall come upon him.
I guess I'm evil for wanting to be rich
edit: my post was in haste. didnt make sense. carry on
you'd have to take that up with king solomon. he wrote it, not me.
I'm surprised no one recommended I start a meth retail business.
Our new citizens from the Southern border have that market dominated. I'm still trying to perfect my potcorn invention. So far it's up in smoke.
now that is the type of activity king solomon had in mind. tormented innocently trading options is not a problem, unless of course he can't feed his family.
You gave a 2-week timetable! That would take much longer my friend. I did see a good documentary called Breaking Bad though, so I think it's possible if you have the drive.
So, meth is on the decline because nobody got time for dat?
Household labs were the Work From Home (WFH) before...WFH was a thing.
Squeeze plays are the new drug of choice. Take a trip and never leave the couch
Only an idiot would work for a living, these days. There is so much free money laying around, there is no excuse for not being rich.
If rich defines as living a free spirited life and the ability to do as I please with no debt or anyone to answer to then I'm a wealthy man. I'm probably older than you, retired and enjoy the simple things. My shack is paid for and my 1000 dollar hoopty drives just fine for the past 10 years. I'd prefer to keep my money for myself instead of giving it to corporations. I trade for lunch money and don't advertise. I try not to brag that bbby gained nearly 100% on the upside yesterday and close to 50% on the down today. It's irrelevant and really serves no purpose.
Assume I'm lying and place me in the 99% of traders that lose category on your graph, problem solved.
I hold 4 stocks and a couple bonds. I'm just a po basturd.
It is going to come down to the definition of "lying". Certainly, I do not believe you are beating the market.
My neighbor gets 32mpg with his 2001 Ford Explorer. Do I believe he gets that fuel economy? No. Do I think he believes it? No, not really but I think he justifies the number with some mental gymnastics. I suspect he believes he can hit 32mpg on a flat road with no wind if he assumes using 1/4 tank based on the gauge reading is 4 gallons and then subtracts 20% of the fuel for idling and subtracts another 15% for a temperature adjustment. At that point, shazam... 32mpg.
If accounts were locked in such that you could put a given amount of money in with no ability to add or remove money until retirement, and brokerages calculated annual returns by taking the year end balance and divide by the previous year end balance, and brokerages published everyone's portfolio performance, there would be worlds less bullshit on the forums.
I have a locked in retirement account that has averaged 15.98% CAGR over the last 10 years. I'm looking at the stats, right now. I am absolutely delighted with that.
My personal goal is to average 10% across any decade. If it gets less than 8% across a decade, I will switch to index investing.
The thing is, I could be lying about that account. I'm certainly not going to put that info on the Internet. You could be lying about your performance. I have no expectation you are going to publish your personal info, nor am I asking you to. I've come to believe everyone lies, with just a few exceptions.
So, how to know if someone is lying? Do I give them the benefit of the doubt? Well... sure but within limits.
If you told me you just won the lottery, I would be happy for you and consider how great that is. If you told me you won the lottery every week for the last year, I would probably be a bit skeptical.
Look. Returns do not get mulligans. That trade that went sour does not get to be disregarded because it wasn't really something you meant to do. That trade you almost did that would have made a ton of money... doesn't get counted, either.
Also, the money you add to your account has to be removed from the gains, just as money removed from the account needs to be accounted for. Any gains made from equity adjustments need to be prorated, as well. Who does that? I mean, other than me?
When I started to keep meticulous performance metrics, that is when my investment knowledge and performance began to really ramp up.
I believe one of the reasons essentially nobody bothers to keep meticulous performance metrics on their investment accounts is because it would burst the reality balloon they are living in. It's a whole lot easier to lick your thumb, hold it up to the wind, and then make some adjustments based on intent and fantasy.
I currently hold 7 companies, no bonds, several GICs, and quite a bit of HISA. I make no claim to being the best investor. In fact, I will state directly I am not.
It just comes down to standing outside of a casino and listening to 95 out of 100 people leaving tell you they just made a big pot of money. One or two of them are probably telling the truth. I will smile and say, "Hey, that's great!" to each and every one of them but I'm going to stick with statistics on my overall estimation of that casino's P&L for the day.
I would like to add that my 32mpg neighbor is one of the nicest people I know. He and I are not enemies, to say the least. I consider him a friend and would give him a glowing character reference to anyone who asks.
Next, essentially all short term trades lose money. If you buy at market and then immediately sell at market, you will have less money essentially every time.
For people with real accounts, commission reduces the odds to less than 50% and will cause a loss in all but the most rare of market conditions.
To people with commission free accounts, you are buying from and selling to front runners. You are not getting the market price. Why do you think it is free? Front runners will hit you on both ends of every transaction, causing a loss to instantaneous buy/sell trades in all but the most rare of market conditions.
Consider an event with less than 50% chance of success. Next consider doing 200 of those events in a year (one trade per day). The odds of success are 0%.
So, Spud. I'm delighted to read you continue to win the lottery week after week. I offer my congratulations and wish you many years of continued success.
While I'm here...
What are the odds that any given stock will go up between now and a year from now? I estimate 90%.
What are the odds any reasonably broad market index will go up in the next 12 months? The same 90%.
9 out of 10 years have market gains.
What are the odds all reasonably broad market indices will go up over the next decade? 99%.
Short term trading = 0% chance of success over the long term.
Long term investing = 99% chance of success over a 10 year period.
Place your bets, my friends.