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Ask HN: Any Day Traders on HN?
I see non-quant trading methods regularly bashed here, so was wondering if there's any short term traders (< week) on HN?
As this is an eng-heavy crowd would be interesting to hear you story and what kind of analysis you do (not expecting too much detail of course!).
- arthurcolle 6y agoI use a hybrid complex event processing system that is mostly custom built, as well as a large scale data ingestion framework that takes in around 2-3GB of price data and other relevant information every day. It took a really long time to get this part of my setup working because without a decent way to kick off a process that subscribes to this data easily, everything else is going to be a huge pain in the ass. I put on trades on a 2week-1 month time frame, and aggressively sell winners and use stop losses to get rid of shitty positions. I use GARCH, ARIMA models, and have recently been playing around with some more exotic ML techniques, but I've found that momentum trades work the most reliably. I'm working on a SaaS API to try and make some money off of my data collection systems, but that's still in the works. EDIT: I try to identify interesting individual options that are, according to my model "mispriced" given a few signals. I seek out multibagger options. Most recently, I purchased the $PLTR 11/27 $22 strike calls two days ago, and made a killing (was around a 6x gain). If you are methodical in your data collection processing, there's a lot of valuable information that can be obtained. It just requires lots of data munging (which, honestly, is so painful all things considered). But turning 1k into 10k is a wonderful experience, especially if you can reproduce it. I have taken the well known 30-40 advanced options strategies and created a dynamic programming algo to basically run through every single listed security and every reasonable combination of options that would yield these strategies, with some filtering to make it computationally tractable, and then computed what the collateral costs would be (for spread trades, for ex.). That creates a reasonable doable list, and then I run a straightforward backtest. From here, I either pursue a trade or not. I like the idea of fully automating this stuff but its just not there yet. In any case, systematizing a lot of the boring crap is a great way to more deeply understand the landscape. You're never going to compete with execution-based firms but you can definitely take a view based on underlying fundamentals/macro landscape and then tune a slightly longer based system appropriately.
- nkamoah17 6y agowow, Love this!
- icedchai 6y agoThis sounds super cool. I was eyeing PLTR since it went public. I missed my chance and didn't pull the trigger. Glad it worked out for you!
- marketgod 6y agoWhy do you think you missed it?
- lastofus 6y agoHow does one learn about finance enough to do something like this?
- arthurcolle 6y agoI worked at Goldman for a few years. I would suggest doing something like that.
- jklein11 6y agoHow does one learn enough about finance to do something like that?
- oumua_don17 6y agoCan you elaborate what roles would be preferable when working at place like Goldman? What typical qualifications and experience are expected?
- giantg2 6y agoThey shouldn't be much different from other engineering jobs. One thing they will look for is "business acumen". Learn all the finance buzz words, pay attention to the market, and credentialize. Finance people seem to love prestige and credentials (just my experiences). A degree which includes finance is good. You can also get a CFA foundations certs. A CFA charter would get you real respect, but I think they have experience requirements for that.
- heyyouthere 6y agoDo you mean profitable traders or non-profit traders? =) Myself, I'm just a algotrader focusing on short term trades in the crypto and equities(microcaps) markets. Tech stack is EC2/screen/pypy(python).
- zaptheimpaler 6y agoI day traded options for a little while but now trade longer term options. I don’t run any complex strategies, partly so I can spend my time on identifying winners instead. Just buying calls or puts, sometimes spreads. I don’t have a way to automate that, it’s just reading a lot and trying to formulate and rank possibilities It’s my first year and I’m only at a 10% return in my fun money portfolio (vs 50% on just buy and hold QQQ) despite a few multi baggers because of not cutting losses earlier. Hoping to do better this year and add some basic stop losses at least. I may add more automation and start building my own tools now ,this past year I focused on trading manually so I know what would be useful to build in the first place. I’m building a basic Jupyter notebook to analyze previous trades and explore the API.
- giantg2 6y agoI love trading LEAPS. I've started sort of swing trading them with the recent volatility.
- devchris10 6y agoApologies for piggybacking on the original question but couldn't pass up the opportunity to ask the daytrading crowd. Would you publicly post price predictions/odds to get ranked alongside other traders via Brier scores?
- marketgod 6y agoPeople won't because most of them lose.
- webmaven 6y agoYes. Now, to be clear, I am not one myself, but the answer is still yes.
- marketgod 6y agoFrom your description, the term you are looking for is swing traders. Yes, I swing trade options. All technical analysis. Only stocks. Pure technical analysis. Main items we focus on are price-action and price-volume. In essence, for every minute the price goes up, what's the volume? For every penny the stock goes up, what's the volume? For every 100,000 shares what's the change in price?200k? 300k? 1m? and so on. Also, weighted factors for all the different indicators, MA/SMA/CCI/RSI/VWAP being of most pertinence. Pitch fork trends weighted at a lower level. Also several other proprietary indicators based on stock correlation (i.e. BABA vs AMZN, if AMZN is moving down, BABA should as well because of what it relies on). I have been getting killed the last month but still up over 100%. Just hit on GS (100%+), and likely will on TSLA. Also did 1500% on TSLA this year on a trade which was my biggest so that helps. TSLA seems ready for a similar move to when I made my last huge run.
- aparsons 6y agoIs there a reason why a lot of people prefer to swing trade options rather than stocks? I understand the upside can be greater, but so is the risk. Is there something I’m missing? Is there a risk level beyond which options make more sense?
- marketgod 6y agoI think there is less risk. Especially with my strategy. Also you get 100x leverage. So I will give you a sample trade from today. I bought Dec04 $600 Calls for $900 each at 9:55 am. At 1:25 I sold for $1820. So $1000 would be $2000. Now to make $1,000 in shares it would require ($1000/($25)) so I would need 40 shares (40*$550) = $22,000 risk. Now I only buy calls or puts so my upside is always unlimited but downside is limited to the initial order. Swing trading stocks is really hard because you have to sleep on $22,000 overnight. You can wake up with nothing in a black swan event. With options the most I will get hit on is $50-$100,000 which I have in the market at once. The rest is ready in the savings account in cash or etfs/TSLA stock. I think options are the safest bet. Everyone starting out should look into the wheel strategy as it's basically free money for shareholders.
- cik 6y agoMy (personal only) side project trades weekly, and takes several positions. I never hold a position for more than a week, and occasionally trade the same position several times within a one-day period. I'm on version 5 of my robot, and have recently been thinking of turning the data it gathers into a service to make it easy for other developers to get real-world data at a reasonable price. I use my data to search for inefficiencies (however small) that exist in the market. I then arbitrage these efficiencies on a weekly basis. I do this across stocks, options, and futures (not Forex). To be clear my goal is not to find "stocks that will pop", or "stocks that will plummet", rather I purely exploit micro-inefficiencies that exist in the market, which means this cannot work at scale.
- marketgod 6y agoWhat are the returns and how many years?
- blackrock 6y agoGo long. The Fed is printing money! And the next Treasury Secretary is.. Janet Yellen.
- giantg2 6y agoWhat do you see changing?
- blackrock 6y agoInflation. A massive increase in asset prices in stocks and housing. QE Infinity is here to stay. Low interest rates are going to screw up everything. Go long in stocks. They’re going to save the market.
- giantg2 6y agoBut how does Yellen change that?
- blackrock 6y agoShe will perpetuate the inequality in America. The rich will keep getting richer. The line between the haves and the have nots, will continue to divide us. It’s easy for the Fed to drop the interest rate. It’s just the stroke of a pen for them. And it’s not their money, since they’re just printing it. It’s harder to put concrete action into policy that will help Americans and ensure equality and fairness for all, instead of for just the privileged few. The last time she was the Fed Chairman, she lowered the interest rates and injected QE into the system, which benefited only the large corporations that really didn’t need the help. But it devastated everyone else that could have used the help. And again, without fixing the systemic issues, they will repeat the 2000 dot-com implosion, and the 2008 housing crisis again.
- giantg2 6y agoSo... the same as now
- blackrock 6y agoI watch the options volume. Once I saw a majorly abnormal spike in Call volumes. It happened minutes right before a major Fed announcement or something. The market rallied, and continued to rally. It seems, someone got a leak of the Fed notes, and went long on Calls.
- deleted 6y ago[deleted]