Share trading.

[Uplift]

Gidday, is there anyone on this forum that genuinely makes their primary weekly, fortnightly, or monthly income from trading in shares, options or CFD's. That is my goal, I've been seriously trading for around two years. I have bought numerous books, and done a few courses, but have had trouble with their actual performance and reliability, (or maybe my understanding of them) and difficulty finding info from actual, practising traders, who do not rely on the income from broking fees, book sales or course fees. I am seeking info from anyone that knows that they could regularly and reliably start with a small amount, and build it up into an income producing amount. Any info or directions towards suggested info or books, from such traders, would be sincerely appreciated. Thanks.

[BadBilly]

Hello,
I make my primary income by trading stocks and options.
I don't think you will see anyone who is truely successful at this be willing to shares their "tricks" and secrets. In my case, I have put in an incredible amount of work to get here. And, paid a lot of money out in "tuition." I have a Masters in Finance and over three DECADES of trading experience. What would possibly be in it for me? One thing I will share is to stop wasting your time and money on "systems" that are sold. Never saw one that worked. Instead, put your time and efforts into really understanding the stock market and the options markets. With enough experience you will begin to see that there are several methods that carry higher percentages of success over others.
BB

[Uplift]

Thanks, thats the conclusion I was reaching with the courses promoting their systems. Do you feel there are any useful books you've read that stood out as better than others, not only in content, but, in clarity as well? I promise I won't try and weasel any direct info, but could I be a pain and ask if in options trading, you focus on predicting the underlying shares movement, or on the hedging bets style of strategies, and also if you feel that really it is just money management that is paramount. Oh yeh, I also wanted to ask you if you rely on technical analysis?

[BadBilly]

I have a personal library of over 200 books on trading, options, etc. Some good, some not so good. I have slowed down lately on buying them. Options can be quite daunting and are very complicated. It will take lots of study but they can be very rewarding. Don't just "dive in" and start making trades. Take the time to really know what you are doing. Since you seem to have a good attitude and understand my reluctance to go into much detail about how I trade, I will answer your question on how I use options. First, I only use options on the indexes, never on an individual stock. The indexes move more slowly and I collect premium and have time on my side. To do that I do mostly credit spreads. Bull put spreads below the market and Bear call spreads above it. Way, way out of the money. And set to expire in the next month, never farther out in time. The only way I get hurt is from a 9-11 type event and I have that happen about once per year so I do incur a large loss when that happens. I just factor that loss in and expect it when it happens, no surprise. Have just had a run of 5 months with no problems so doing good right now. I hope I have answered your question, if not please ask again and I will try again. There is no simple thing involved here, my years of experience do count, but the sooner you get started, the sooner you will be there.
BB

[BadBilly]

To answer your question on Technical Analysis, no, I really don't use it much. I did a lot of study on my own, and in my Masters Program and coming from a technical background (running power plants) I really was driven to it. Feel free to send me a PM and we can discuss this all off-forum.
BB

[Uplift]

Thanks again. And thanks for the actual direction in options advice (I hear what you said in your first post). It's more than I expected, and plenty for me to delve into. I did the dive in about four years ago, and at least had the sense, (or maybe just horror at watching my capital dissapear) to dive out. I realised I better learn some more, and learned enough to begin actual trading again, mostly in options on top 20-30 ASX shares (about 2 years ago) and to trade cautiously, and this time more successfully. As you so rightly point out, I also learned enough to realise that if you really want to make a reliable, good income, especially from options, that there is so much to learn and experience (unless you are starting with a huge amount of capital, which at least means you can avoid leverage, and can get away with lack of good timing). Finally, as I have a heap of books that I haven't found particularly good, could I ask for the titles of a few of the books you found good, particularly in the area of timing, and that are well presented? I also realise everyone has differing views and opinions on books and things, but as I have found it really difficult to find genuinely successful traders, I would be interested in your view. Much appreciated.

[BadBilly]

Probably the best book that does a pretty good job of explaining the type of options stuff that I do is: OPTIONS - A Personal Seminar by Scott H. Fullman. It is based on the popular classroom seminar conducted by the New York Institute of Finance. Of particular interest would be Chapters 6 (Basic Spread Techniques) and 7 (Spreads Using Time). Also, Chapter 15 (Index Options). Very dry and lots of numbers. Do not try to read just before bedtime!
BB

[JiriNovotny]

I know about day trading only that much it is incredibly time consuming and difficult to learn stuff. You have to work like you are employed. I know a few guys and one lady who do it full time and they are making some nice money, but usually they risk their whole capital in each trade.

I would rather spend a few hours a month investing in small caps that have huge potential to multiply a few times. That is more long term investing though (3-7 years). Nonetheless, you can pull the money to invest from normal job or your business when you do not have to trade every day.

For example, $10.000 invested in Dell could make you $6M in 17 years. I believe that such opportunities are still out there. To say the least, you can beat the market with small caps.

[Uplift]

Thanks heaps BadBilly. I ordered a copy. Its unavailable in Australia, so I had to get it from Amazon USA. Might take a few weeks. You have been most helpful, and inspiring. I appreciate your PM offer, but I won't bother you. I feel that it is up to me now, to read, learn and gain some understanding myself of your pointers. Again thanks for the much appreciated fuel for the fire!

[marty]

hi BB,i trade the uk and irish horseracing markets which is a little different from your game but was wondering had you any book recommendations that deal with the psycology of staying on your 'a' game and helping with the spiritual side of things. by the way i really like 'zen and the art of poker' as i find i lot of poker psycology helpful with the way i do things if any1 is interested..

[ggg281]

I have starting doing some research into a better way to trade the markets. I'm discovering that the Dow Jones Index has predictable movements each day at certain times of the day. This is also in direct relationship with support and resistance levels. I have just started paper trading it to see if Im on to something. I may blog about it if successful. But it should be good for 50 to 100 points a day. Just wish I did not have so much on my plate right now so I could dedicate more time to it.

[BadBilly]

Just to follow-up a little bit to all and Uplift, I have found an excellent on-line seminar (free!) at Charles Schwab that does an excellent introduction on the kinds of option spread trading that I do. Unfortunately, for all their examples they use options on individual stocks. Just substitute an option on one of the indexes (SPX, RUT, NDX). I DO NOT recommend these strategies on individual stocks. Yes, I learned the hard way! Anyway, just go to the Charles Schwab website. Click on the "Active Trader" tab then select "Education" then "On-line Seminars." The seminar of interest is called "Practical Options Strategies for Any Market". Hope this helps those of you that are interested in option spreads.
BB