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comment by rinx
rinx  ·  3361 days ago  ·  link  ·    ·  parent  ·  post: September 14th: What are you reading this week?

Yay random walk! Love that book, wish it was taught in schools. I'm so curious what the day traders book says - does it promise you wealth and riches?

If you stay on a finance kick and haven't read them, some suggestions:

The Investor's Manifesto - I really understood asset allocation so much better after reading this

The Bogleheads' Guide to Investing - My finance bible

The Millionaire Next Door - Interesting write up, especially the notes on parenting





kleinbl00  ·  3361 days ago  ·  link  ·  

As it turns out, "pattern day trading" is defined by the Securities and Exchange Commission as executing four or more trades of the same security in five days. "Day trading" is the practice of closing out all positions and returning to cash at the end of every trading day. "Swing trading" means holding shit for less than a week and yes, there's a "for dummies" book on that, too.

Holding shit for more than a week? That's considered "investing."

The day trading book doesn't promise wealth or riches at all - it makes the point that in any legitimate study of day trading, 80% of traders are wiped out within a year and those that aren't wiped out earn a median income of $3k per year from their trades. They then say "but it's legit because real estate agents do worse." It's kind of amazing - it goes out of its way to say "day trading isn't gambling" and then uses gambling metaphors for the rest of the book.

I've saved your comment. I'll definitely check them out. I put my wife into a Yale unconventional last week and I'm doing a Bogle 3-fund for my meager portion.

(and doing all sorts of options hijinks in Thinkorswim but that's fake money so who cares)

user-inactivated  ·  3361 days ago  ·  link  ·  

Gambling metaphors, and borrowing terminology from gambling, is really common among finance people in general though. I think it's really because probability theorists like to talk about everything in terms of gambling and the finance people worth listening to for the past few generations have been steeped in probability enough to have picked up the habit and spread it.

kleinbl00  ·  3360 days ago  ·  link  ·  

Point taken, but they don't need to constantly mention doubling down and spinning roulette wheels.