A whirlwind tour of Defi, paying close attention to protocols that we’re leveraging at Genesis Block.submitted by mickhagen to genesisblockhq [link] [comments]
This is the third post of Crypto-Powered — a new series that examines what it means for Genesis Block to be a digital bank that’s powered by crypto, blockchain, and decentralized protocols.
Last week we explored how building on legacy finance is a fool’s errand. The future of money belongs to those who build with crypto and blockchain at their core. We also started down the crypto rabbit hole, introducing Bitcoin, Ethereum, and DeFi (decentralized finance). That post is required reading if you hope to glean any value from the rest of this series.
97% of all activity on Ethereum in the last quarter has been DeFi-related. The total value sitting inside DeFi protocols is roughly $2B — double what it was a month ago. The explosive growth cannot be ignored. All signs suggest that Ethereum & DeFi are a Match Made in Heaven, and both on their way to finding strong product/market fit.
So in this post, we’re doing a whirlwind tour of DeFi. We look at specific examples and use-cases already in the wild and seeing strong growth. And we pay close attention to protocols that Genesis Block is integrating with. Alright, let’s dive in.
StablecoinsStablecoins are exactly what they sound like: cryptocurrencies that are stable. They are not meant to be volatile (like Bitcoin). These assets attempt to peg their price to some external reference (eg. USD or Gold). A non-volatile crypto asset can be incredibly useful for things like merchant payments, cross-border transfers, or storing wealth — becoming your own bank but without the stress of constant price volatility.
There are major governments and central banks that are experimenting with or soon launching their own stablecoins like China with their digital yuan and the US Federal Reserve with their digital dollar. There are also major corporations working in this area like JP Morgan with their JPM Coin, and of course Facebook with their Libra Project.
Stablecoin activity has grown 800% in the last year, with $290B of transaction volume (funds moving on-chain).The most popular USD-pegged stablecoins include:
tablecoins are playing an increasingly important role in the world of DeFi. In a way, they serve as common pipes & bridges between the various protocols.https://preview.redd.it/v9ki2qro12b51.png?width=700&format=png&auto=webp&s=dbf591b122fc4b3d83b381389145b88e2505b51d
Lending & BorrowingThree of the top five DeFi protocols relate to lending & borrowing. These popular lending protocols look very similar to traditional money markets. Users who want to earn interest/yield can deposit (lend) their funds into a pool of liquidity. Because it behaves similarly to traditional money markets, their funds are not locked, they can withdraw at any time. It’s highly liquid.
Borrowers can tap into this pool of liquidity and take out loans. Interest rates depend on the utilization rate of the pool — how much of the deposits in the pool have already been borrowed. Supply & demand. Thus, interest rates are variable and borrowers can pay their loans back at any time.
So, who decides how much a borrower can take? What’s the process like? Are there credit checks? How is credit-worthiness determined?These protocols are decentralized, borderless, permissionless. The people participating in these markets are from all over the world. There is no simple way to verify identity or check credit history. So none of that happens.
Credit-worthiness is determined simply by how much crypto collateral the borrower puts into the protocol. For example, if a user wants to borrow $5k of USDC, then they’ll need to deposit $10k of BTC or ETH. The exact amount of collateral depends on the rules of the protocol — usually the more liquid the collateral asset, the more borrowing power the user can receive.
The most prominent lending protocols include Compound, Aave, Maker, and Atomic Loans. Recently, Compound has seen meteoric growth with the introduction of their COMP token — a token used to incentivize and reward participants of the protocol. There’s almost $1B in outstanding debt in the Compound protocol. Mainframe is also working on an exciting protocol in this area and the latest iteration of their white paper should be coming out soon.
There is very little economic risk to these protocols because all loans are overcollateralized.I repeat, all loans are overcollateralized. If the value of the collateral depreciates significantly due to price volatility, there are sophisticated liquidation systems to ensure the loan always gets paid back.
InvestmentsBuying, selling, and trading crypto assets is certainly one form of investing (though not for the faint of heart). But there are now DeFi protocols to facilitate making and managing traditional-style investments.
Through DeFi, you can invest in Gold. You can invest in stocks like Amazon and Apple. You can short Tesla. You can access the S&P 500. This is done through crypto-based synthetics — which gives users exposure to assets without needing to hold or own the underlying asset. This is all possible with protocols like UMA, Synthetix, or Market protocol.
Maybe your style of investing is more passive. With PoolTogether , you can participate in a no-loss lottery.
Maybe you’re an advanced trader and want to trade options or futures. You can do that with DeFi protocols like Convexity, Futureswap, and dYdX. Maybe you live on the wild side and trade on margin or leverage, you can do that with protocols like Fulcrum, Nuo, and DDEX. Or maybe you’re a degenerate gambler and want to bet against Trump in the upcoming election, you can do that on Augur.
And there are plenty of DeFi protocols to help with crypto investing. You could use Set Protocol if you need automated trading strategies. You could use Melonport if you’re an asset manager. You could use Balancer to automatically rebalance your portfolio.
With as little as $1, people all over the world can have access to the same investment opportunities and tools that used to be reserved for only the wealthy, or those lucky enough to be born in the right country.
You can start to imagine how services like Etrade, TD Ameritrade, Schwab, and even Robinhood could be massively disrupted by a crypto-native company that builds with these types of protocols at their foundation.https://preview.redd.it/agco8msx12b51.png?width=700&format=png&auto=webp&s=3bbb595f9ecc84758d276dbf82bc5ddd9e329ff8
InsuranceAs mentioned in our previous post, there are near-infinite applications one can build on Ethereum. As a result, sometimes the code doesn’t work as expected. Bugs get through, it breaks. We’re still early in our industry. The tools, frameworks, and best practices are all still being established. Things can go wrong.
Sometimes the application just gets in a weird or bad state where funds can’t be recovered — like with what happened with Parity where $280M got frozen (yes, I lost some money in that). Sometimes, there are hackers who discover a vulnerability in the code and maliciously steal funds — like how dForce lost $25M a few months ago, or how The DAO lost $50M a few years ago. And sometimes the system works as designed, but the economic model behind it is flawed, so a clever user takes advantage of the system— like what recently happened with Balancer where they lost $500k.
There are a lot of risks when interacting with smart contracts and decentralized applications — especially for ones that haven’t stood the test of time. This is why insurance is such an important development in DeFi.
Insurance will be an essential component in helping this technology reach the masses.Two protocols that are leading the way on DeFi insurance are Nexus Mutual and Opyn. Though they are both still just getting started, many people are already using them. And we’re excited to start working with them at Genesis Block.
Exchanges & LiquidityDecentralized Exchanges (DEX) were one of the first and most developed categories in DeFi. A DEX allows a user to easily exchange one crypto asset for another crypto asset — but without needing to sign up for an account, verify identity, etc. It’s all via decentralized protocols.
Within the first 5 months of 2020, the top 7 DEX already achieved the 2019 trading volume. That was $2.5B. DeFi is fueling a lot of this growth.
There are many different flavors of DEX. Some of the early ones included 0x, IDEX, and EtherDelta — all of which had a traditional order book model where buyers are matched with sellers.
Another flavor is the pooled liquidity approach where the price is determined algorithmically based on how much liquidity there is and how much the user wants to buy. This is known as an AMM (Automated Market Maker) — Uniswap and Bancor were early leaders here. Though lately, Balancer has seen incredible growth due mostly to their strong incentives for participation — similar to Compound.
There are some DEXs that are more specialized — for example, Curve and mStable focus mostly only stablecoins. Because of the proliferation of these decentralized exchanges, there are now aggregators that combine and connect the liquidity of many sources. Those include Kyber, Totle, 1Inch, and Dex.ag.
These decentralized exchanges are becoming more and more connected to DeFi because they provide an opportunity for yield and earning interest.Users can earn passive income by supplying liquidity to these markets. It usually comes in the form of sharing transaction fee revenue (Uniswap) or token rewards (Balancer).
PaymentsAs it relates to making payments, much of the world is still stuck on plastic cards. We’re grateful to partner with Visa and launch the Genesis Block debit card… but we still don’t believe that's the future of payments. We see that as an important bridge between the past (legacy finance) and the future (crypto).
Our first post in this series shared more on why legacy finance is broken. We talked about the countless unnecessary middle-men on every card swipe (merchant, acquiring bank, processor, card network, issuing bank). We talked about the slow settlement times.
The future of payments will be much better. Yes, it’ll be from a mobile phone and the user experience will be similar to ApplePay (NFC) or WePay (QR Code).
But more importantly, the underlying assets being moved/exchanged will all be crypto — digital, permissionless, and open source.Someone making a payment at the grocery store check-out line will be able to open up Genesis Block, use contactless tech or scan a QR code, and instantly pay for their goods. All using crypto. Likely a stablecoin. Settlement will be instant. All the middlemen getting their pound of flesh will be disintermediated. The merchant can make more and the user can spend less. Blockchain FTW!
Now let’s talk about a few projects working in this area. The xDai Burner Wallet experience was incredible at the ETHDenver event a few years ago, but that speed came at the expense of full decentralization (can it be censored or shut down?). Of course, Facebook’s Libra wants to become the new standard for global payments, but many are afraid to give Facebook that much control (newsflash: it isn’t very decentralized).
Bitcoin is decentralized… but it’s slow and volatile. There are strong projects like Lightning Network (Zap example) that are still trying to make it happen. Projects like Connext and OmiseGo are trying to help bring payments to Ethereum. The Flexa project is leveraging the gift card rails, which is a nice hack to leverage existing pipes. And if ETH 2.0 is as fast as they say it will be, then the future of payments could just be a stablecoin like DAI (a token on Ethereum).
In a way, being able to spend crypto on daily expenses is the holy grail of use-cases. It’s still early. It hasn’t yet been solved. But once we achieve this, then we can ultimately and finally say goodbye to the legacy banking & finance world. Employees can be paid in crypto. Employees can spend in crypto. It changes everything.
Legacy finance is hanging on by a thread, and it’s this use-case that they are still clinging to. Once solved, DeFi domination will be complete.https://preview.redd.it/svft1ce422b51.png?width=700&format=png&auto=webp&s=9a6afc9e9339a3fec29ee2ae743c07c3042ea4ce
Impact on Genesis BlockAt Genesis Block, we’re excited to leverage these protocols and take this incredible technology to the world. Many of these protocols are already deeply integrated with our product. In fact, many are essential. The masses won’t know (or care about) what Tether, USDC, or DAI is. They think in dollars, euros, pounds and pesos. So while the user sees their local currency in the app, the underlying technology is all leveraging stablecoins. It’s all on “crypto rails.”
When users deposit assets into their Genesis Block account, they expect to earn interest. They expect that money to grow. We leverage many of these low-risk lending/exchange DeFi protocols. We lend into decentralized money markets like Compound — where all loans are overcollateralized. Or we supply liquidity to AMM exchanges like Balancer. This allows us to earn interest and generate yield for our depositors. We’re the experts so our users don’t need to be.
We haven’t yet integrated with any of the insurance or investment protocols — but we certainly plan on it. Our infrastructure is built with blockchain technology at the heart and our system is extensible — we’re ready to add assets and protocols when we feel they are ready, safe, secure, and stable. Many of these protocols are still in the experimental phase. It’s still early.
At Genesis Block we’re excited to continue to be at the frontlines of this incredible, innovative, technological revolution called DeFi.---
None of these powerful DeFi protocols will be replacing Robinhood, SoFi, or Venmo anytime soon. They never will. They aren’t meant to! We’ve discussed this before, these are low-level protocols that need killer applications, like Genesis Block.
So now that we’ve gone a little deeper down the rabbit hole and we’ve done this whirlwind tour of DeFi, the natural next question is: why?
Why does any of it matter?Most of these financial services that DeFi offers already exist in the real world. So why does it need to be on a blockchain? Why does it need to be decentralized? What new value is unlocked? Next post, we answer these important questions.
To look at more projects in DeFi, check out DeFi Prime, DeFi Pulse, or Consensys.
Other Ways to Consume Today's Episode:
Download the app. We're a digital bank that's powered by crypto:https://genesisblock.com/download
|How many hours a day do you work?||How many hours a day do you work? - 6.5 actually trading, and probably another 3-4 doing analysis, scanning, finding stocks for the next day, preparation in the morning, etc.|
|Are you in front if the screen for the whole trading day?||Are you in front if the screen for the whole trading day? - Generally, yes. Unless I have a hot morning at which time I just quit and take the day off and go to the beach!|
|How do you handle being alone for the whole trading day if you are in front of your screen ask day?||How do you handle being alone for the whole trading day if you are in front of your screen ask day? - Well, I talk to a lot of other traders on Skype and/or Google chat, and I try to get out of the house and trade in different locations to keep things interesting. It can get lonely, but I have a lot of friends and have no problem inviting people over to chill while I trade and it benefits them too cause a lot of people want to learn it and sitting here w/ someone doing it full time is a really cool and fun way to learn!|
|What do you use for analyzing your trade history?||What do you use for analyzing your trade history? - www.tradervue.com, and lots and lots of Google doc spreadsheets lol.|
|However by the end I couldn't handle being alone and stuck in my chair all day. Did you have to cope with any of that?||I'm curious as after the last 4 years or so where I've been studying and watching, I feel I've got a nice KISS method. I did 2 months of full time paper trading to see how I did. However by the end I couldn't handle being alone and stuck in my chair all day. Did you have to cope with any of that? - Yes it is definitely an adjustment. I worked in IT so I was pretty much glued to a computer all day anyway, so it wasn't AS much of a change for me, but I do read a lot and hear a lot that day traders start to go crazy after a while just from the lonliness/lack of human interaction. That's why I do things like this Reddit, and my courses that are taught via live webinar though. Keeps me from goin nuts and going postal ... on myself!|
|If I do go part time how do I keep my life balanced so I can watch the trades closely but not be consumed by them?||The Importance of Happiness: Link to justanotherinvestingblog.blogspot.com|
|What's your P&L ?||What's your P&L ? - I try to shoot for a $500-1k gain per day and keep my loss days when they do occur to $250-500. Per trade, I try to risk no more than $200-300 depending on market conditions, and during certain markets I will increase or decrease risk if I feel it is worth it. I also have a detailed risk management plan that I use to make sure if I have a string of losses they are cut to $0 within 3-5 days so I can re-evaluate, and if I have a string of wins, risk increases based on my wins so that I can capitalize when I'm on fire and minimize losses when I am in a slump.|
|What degree do you have ?||What degree do you have ? - I have a bachelors in MIS (unrelated to finance, lol)|
|Are you interested in HFT ?||Are you interested in HFT ? - Not really. As an IT geek I do find it fascinating that there are applications that can scalp all day long and consistently make money over the long term, but I just do not believe that in such a dynamic environment that anything like that is really sustainable. It would just be way too much work for me to try to develop something to trade for me, plus it would take all the fun and challenge out of it!|
|With how much money did you start ?||With how much money did you start ? - I originally started investing with only $1k. I swung that very slowly (up and down) while saving from my job(s) up to about $5k. I then injected another $5k of savings and started getting very serious with trading with around $10k. Then I lost about 50% of that in like 2 months (lol). The whole time I worked full time and saved every penny I could until I had saved up enough to open a PDT (pattern day trading) account with $25k and also became fully immersed in trading talking to other traders and taking a few trading courses here and there to tweak my strategy. Now I trade that account (I keep $26.5k in it and build it up as much as I can each month then withdraw back to $26.5k and that is how I get paid) and I have a small $5k account that I use for swing trades and experimental strategies.|
|Are you interested in working for big firms (GS, JP, City...)||Are you interested in working for big firms (GS, JP, City...) - Not really. I have debated it in the past but I think it is just way more satisfying to do it on my own. Also, I don't want to be part of the firms that everyone complains are corrupt/evil/etc. For me it is more fun and exciting to just trade on my own, and it is more rewarding because if I decide I want a raise I just work harder and trade better and boom! I get a raise!|
|I'm sure you're familiar with the high failure rate of day traders (80%-98% within two years, depending on your source). Not trying to be an ass, but how us your investing method different than the typical day trader?||That's actually a very valid question. My method of picking stocks or buying/selling really is not different at all. What is different is that I have the emotional discipline to cut losses quickly and let my winners run. Most traders that fail, and I have seen many come and go even across the very few years I've been doing this, fail because they do not cut losses quickly and they are not good risk managers. I have always been frugal and very cautious with my money, and I am the same when I trade.|
|I trade very systematically, and analyze everything I do with statistical analysis so I always know the stats between each type of pattern I trade. For example, if you look on my tradervue link in the OP, you'll see tags like IFB (intraday flag break), IBD (intraday breakdown), TTB (triple tap breakout) identifying the patterns I am trading so that I can go back and find all those tags and see how profitable they are, by tag. I also very systematically trade with a 2:1 reward to risk ratio at a minimum, so if I am risking 10 cents on a trade I will always be able to make at least 20, 50 cents for a buck, 1 buck for 2 bucks, etc. It takes a lot of self control to actually cut those losses where they cross that level of risk, but if you can do that there is no reason 98% of people could not be profitable in this profession.|
|Obviously there are a ton of other factors that go into it, and I am still very new so who knows, maybe I will blow up and go insane and fail and go broke, but for now I'm doing ok, so I can only speak to what I currently know.|
|BTW, my blog is very reminiscent of my overall strategy and trading philosophy if you want to check it out (it's free). I just recently rolled it from Blogger to Wordpress so some of the links might point back to my old blog but all the info is at both places: Link to www.greenbartrading.com|
|If you have a consistently-performing strategy, how come you aren't rich yet?||Consistency does not equal wealth. I live comfortably on what I make but I am not trading to become rich, really. I trade for a living because I like the freedom it offers me, being able to work for myself and go wherever I want and take my work with me (for example spending more time w/ family/friends, traveling, etc)|
|To answer your question, I am very new in this game so it would be foolish to assume I should be rich already. My strategy works so that I can pay my bills and have money to spend on the things I like and the things I want to do, but I am still limited to the money I have in my account and the buying power that it gives me. If I had millions of dollars in capital and $20m in buying power, sure I could use similar strategies and probably make $100k a day but it takes a long, long time to build up that kind of power in a trading account.|
|It is a common misconception in trading that as soon as you have a consistent strategy you will instantly be able to scale it to become super-wealthy. That theory leaves out the obvious aspects of being able to handle the swings in P/L emotionally and especially the issue of liquidity. I can identify a pattern on a chart and say I'm going to buy 100k shares and make $10,000 in 5 minutes, but actually getting filled on that 100k shares is a totally different story. It is much harder to execute strategies like mine when you are playing with huge sizes. That is why I try to rack up small gains with a consistent win rate vs just trying to home-run every trade and get rich quick.|
|What do you think of companies that are making software for retail investors to engage in HFT when they don't even know anything about coding, etc?||I don't know much about that field so I don't want to say too much, but in general I think that like many people in this business they are just out to make a quick buck, by selling something to others who are trying to make a quick buck.|
|Don't you think its bad advice to tell a beginner to trade on 2:1 margin?||Not at all. Margin is only dangerous if you don't know how to use it. If you understand that trading a $5k account on 2:1 margin means you're trading with $10k, but you still need to manage the risk as if you have $5k, you'll be fine. When I first started getting really serious with trading, I actually traded a $10k account with 10:1 margin but I never used more than 2:1 or 3:1 because I just didn't want to risk that much.|
|The margin is only bad if you let it get out of control. Also, it is impossible to short without margin and shorting is vital if you are going to be consistently profitable in the long term. Most people say shorting is more risky but if you short properly, managing risk with stop losses just like when you go long, then there is absolutely no difference between shorting and longing in terms of risk. I don't generally recommend swing shorting for beginners, only because news releases can make things really ugly, but in general, trading on margin and shorting is fine as long as you are smart about it and you understand it (which is not that hard with a little reading).|
|Edit: To clarify, most of the risk associated with margin comes when people get greedy. If you have a $10k account with 10:1 margin on it and you dump $100k into a stock and risk $2,000 to make $4,000 sure you could make 40% on your account but you could also lose 20%. It makes much more sense, especially with a small account, to trade w/ a reasonable amount of margin so that you can maximize your gains without destroying your account w/ too much risk. This is also just personal opinion. Whether or not trading on margin is a bad idea really depends on the person. I know people who have 50:1 margin and trade 100% in cash, and people who have like $5k and trade as if they have $100k cash rather than $95k of it being margin, lol. It all depends on your personality and how well you understand the risk you're taking.|
|"...there is absolutely no difference between shorting and longing in terms of risk."||Fair enough. That is true. In my experience though I have only in very, very rare cases seen a stock double in an overnight session unless it was a penny stock or something very thin being pumped. In the stocks I generally trade I almost never see that. While I do see large gaps I don't really trade stuff that tends to gap more than 100%.|
|You can lose more than 100% of your investment overnight through shorting, which you can not do by going long. Stop losses do not guarantee that you can prevent this from happening - crazy things can happen while the markets are closed.||In theory, you are correct though, and it is important to realize that for sure!|
|While this might be rare, it's still a critical difference that people should be aware of.||Edit: BTW, it's worth noting that nothing in the market is guaranteed. I believe that if you trade with the fear of losing 100% on an investment overnight you are, in general, being a bit too paranoid. Yes it happens, and it blows bigtime when/if it does, but it is not common enough to really worry about IMO. Just something to be aware of.|
|Can you explain what it means to invest on a margin? I understand that it is investing money that you don't currently own, but where is the additional money coming from?||Usually the broker. If you lose too much, they will do a margin call, which basically means they can protect themselves by forcing you to sell your positions to protect their money if you're investing with it.|
|This risk is generally mitigated though. I trade on margin every day but I am still only risking a very small percentage of my capital on each trade. If I were to hold trades for longer term timeframes, I might worry more about margin calls but still, in most situations you are going to be pretty well protected by stop losses unless the stock is making huge moves of 40%, 50%, 100% etc which is not all that common in the names I generally trade. In my experience I have not seen margin calls until people have lost like 70-80-90% of their account values on a single trade already. If you can't cut your losses before that point you probably should not even be trading :)|
|How do you feel about Fannie and Freddie? Release from conservatorship and skyrocket? Or wind down and loss of shirt for the common shareholder?||On Fannie and Freddie I never touch them as they are super thick and riddled with manipulation. There are certain stocks I just do not trade and those are two (FNMA/FMCC)|
|Ariad Pharma (ARIA) - Thoughts?||ARIA is actually another on my ban list. Don't know anything about it fundamentally but statistically I have lost money almost every time I traded it so I just don't anymore.|
|Zogenix (ZGNX) - Thoughts?||ZGNX is a great trader. I actually recently bought 2500 shares at $3.59 average (building on a 500 share swing I held from $3.35 the day before) but like a fool I sold it flat after it didn't immediately take off. I caught the top of that recent GIANT 5m share block buy and it killed my average price so since I did not want to risk $800-1000 on the trade I opted to exit flat when it didn't go right away. I don't really know anything about the company itself but I have traded it several times over the last couple years and it usually behaves pretty predictably, so I like it for day/swing trading.|
|How much did you start with when you began day trading?||When I got serious about day trading I started with $10k and traded through a prop firm (as an independent contractor so I was working on my own and only received whatever money I made, no paycheck or boss). I did that because it offered me 10:1 leverage and good trading software (DAS Trader Pro). Once I had the cash built up from that I opened a $25k ameritrade account and now I use that ... I bailed on the prop firm because their software was $125 a month and thinkorsim through TDA is free.|
|What is your daily routine? Do you spend some time reviewing the daily news before the markets open, do you spend time afterwards reviewing your performance, etc?||Yes to both questions. I generally get up around 8:00am EST and do a quick breakfast and shower, maybe go for a run or get outside to do something active. Then I will go through Yahoo Finance inPlay (finance.yahoo.com/mp) and scan for any major news headlines (earnings misses/beats, FDA news, etc). I go through the stockmarketwatch.com premarket section (Link to thestockmarketwatch.com and look at anything that is gapping up or down and use finviz.com to determine why they are gapping. This gives me a bunch of ideas for the day. Also, I usually have a small watchlist prepared from the night before, which is prepared with a scanner I use called StockFetcher (www.stockfetcher.com). I pay 8 bucks a month for that (super cheap actually for how powerful it is!)|
|Right at 9:30 I am mostly just watching stuff. I seldom trade the first 15 minutes only because it is way too volatile and it is difficult to determine a pattern in only 15 minutes. After 9:45 I will look to see if any of the morning gappers held their gaps and perhaps find a couple trades in those ideas. I also have alerts set at various prices from the night before which will be triggering the whole time giving me ideas.|
|After the trading day, I usually just shut down and forget about trading for a while and then later at night I go back and upload all my stuff to tradervue.com and put in comments/details about why I took the trade, where I bought/sold, if it was a gain/loss, etc and post it publicly on twittefacebook. This keeps me honest and makes sure I am always on my game.|
|Also, each morning I am usually watching my open swing trades to make sure there is nothing crazy going on with them and I will usually sell into morning spikes to book profit on those and possibly re-enter later on to add back to my full position size.|
|Finally, every once in a while (maybe once a month) I will just wipe the slate clean, eliminate my entire watchlist, and build a totally new one just to keep my mind fresh and eliminate any bias I have developed toward individual stocks.|
|What kind of additional research you conduct when swing trading in comparison to daytrading?||I always check to see when earnings are, and make sure that there are no major catalysts coming up (FDA panels, upcoming contract renewals, etc). I also go back on the chart for a year and look at all the major moves (gap ups, gap downs and big spikes/drops in price) and research why they moved, so that I can react quickly if I happen to see something similar happen. For most of my swing trades I don't tend to care much about fundamental stuff (PE Ratio, income, etc) because they are not long-term enough for that stuff to make a difference. I am a 98% technical trader, but definitely do pay attention to fundamental catalysts like earnings and things of the like.|
|One other thing is I will use sites like tickerspy.com to check the performance of the overall sector, and keep the general market (SPY) in mind as there are good and bad times to swing trade so I don't want to be swinging long when the market is going down and vice versa, in general.|
|I have an X amount of money I want to invest, but I don't have the slightest idea of how things work in the brokerage world.||The "I'm cheap and don't wanna spend any money" (aka me) answer is to hit up investopedia.com. Everything you should need to know to get started is there, you'll just need to find it all yourself. You need to learn (at a minimum) order types, commissions, different types of trading, margin, and risk management. I teach all this stuff in my course and it's super cheap relative to the other crap that's on the market so feel free to hit me up via my website and I will hook you up w/ a discount code if you want. Let me know if you have any other questions!|
|Also, I don't have time for learning how to be a broker.||The salesman-y answer is that you are the perfect candidate for my Fundamentals of Active Trading course. Check it out at my website in the OP.|
|How about brokers investing my money? How foes that work? How do I find a reliable broker?||Funny you should ask that - you are one of many who has asked me that very same question and the short answer is I have no idea, because I don't like anyone else touching my money, lol.|
|I believe through any retail broker (scottrade, etrade, ameritrade, optionshouse, etc) you can probably get a dedicated licensed broker to invest for you while you do nothing but your returns in that situation are probably going to be minimal after the broker takes their cut and also all the commissions/fees and probably a service fee for the service itself. I really don't know though, so that's something you could ask a local branch or call one of the retail brokers and see if that is a service they offer.|
|I just have never done it because I always wanted to do things on my own so I understood exactly where my money was going and knew that I wasn't being ripped off.|
|Hope that helps!|
|Very good, thanks for your answers and good luck with your trading. Is it bad luck to say good luck to a broker? Lol.||I don't know, but I'm not a broker so it doesn't matter! I'm just a lowly day trader, scraping by in my underwear, day by day. lol|
|I just wanted to tell you that you occupy the job I would hate the most, and thus I have immense respect for you.||Thanks Joewith! It is definitely not for the faint of heart. I have had many people tell me I swear at my computer a lot when I'm trading, haha, as if that's going to make a difference. For me it is all about the challenge though. I love the challenge and the fact that if I fuck up it is 100% on me, and I can't blame anyone else!|
|Question: do you plan to/think you can get rich by doing this, considering the risks involved?||To answer your question: It is not my plan but I do believe it is possible. I actually, right now, make less money than I did when I worked full time, but I am a lot happier because I have the freedom to do whatever I want whenever I want. In the future I do anticipate being able to far surpass my old level of income but I don't expect to be filthy rich. I would like to see my business grow to $1m+ within a few years and see annual trading profits in the $250-500k range on average, but I have a long way to go to get there. Before I left my job, my best month was September of 2013 in which I made $19.5k on a $25k account which was pretty awesome, so I know it is possible to do amazing things with this profession if we just work hard and manage our risks well.|
|What advice can you give to an 18 year old looking to trade? I am going to college next year and I have relatively no expenses, so I'm not afraid to lose a little bit of money. I just put some of my money I have saved into a brokerage account and am just trying to see what I can do with it.||First, make sure that you REALLY can afford to lose that money. If you can that's great! The best way to get your feet wet is to just dive right in. Risk management is key. You can learn technical analysis pretty easily and use it to identify support/resistance levels on the chart. Always make sure that your risk is at a maximum, 1/2 your potential reward. This will make sure that if you take 100 trades, you lose $50 50 times and make $100 50 times, you have $2500 in loss against $5,000 in reward or a net profit of $2500 (less commissions).|
|Basically, do not assume that trading is a get rich quick scheme. If you do you will blow up your account faster than you can blink. Trading is a numbers game. Manage your risk and understand what you're investing in and always have a plan to enter AND exit the trade. If you trade with no plan you are doomed.|
|It's great you're starting to invest as young as you are. If you're a disciplined, controlled individual you will find this is a fantastic way to make extra money and possibly even make a living. Check out my website and look into the Fundamentals of Active Trading course...it might be perfect for you for right now. Email me from the contact page if you decide you're interested and I'll hook you up w/ a discount code.|
|Have you tried different apps for trading? Wich one is (for you) The Best?||Yep! I use Thinkorswim from TDAmeritrade currently. Here is an analysis of four platforms I have used w/ their pros and cons: Link to www.greenbartrading.com|
|I have a finance degree and am very interested in transitioning to day trading for myself full time. What do you use for a trading platform? I have been looking into Cobra Trading and others that cater to active traders.||I use Thinkorswim through TD Ameritrade. I also have used Lightspeed, Scottrade Elite, and DAS Trader pro. I did an analysis of those four here: Link to www.greenbartrading.com|
|I haven't heard of Cobra Trading, but I also know Interactive Brokers is very popular for day traders and active traders.|
|What is your opinion on index funds? I often wonder if day traders actually get higher returns or if their gains are just generally in line with the collective increases in the market. I'm not saying that's true in your case I'm just curious!||I use index funds as a guideline for what to do in my day trades and swing trades. Most of the professional, full time and well-managed day traders I know are significantly outperforming the index funds. Personally, I don't know if I am because I have not been doing this professionally long enough to have the data to decide. I would say that most of the traders I know are definitely not inline with the market, but are proportionately in-line. For example, if they generally outperform the market, they will outperform it even more when the market rips, and if they generally underperform the market it will get even worse when the market starts to tank. I personally specialize in high-momentum stocks (stuff that is moving on earnings, news, fundamental catalysts), and many of those stocks simply do not care what the market does. They are going to go up (or down) regardless of the market because the volume and the feagreed/euphoria surrounding the news/catalyst outweighs general market sentiment.|
|Thanks for your answer. As a side note, are you familiar with day trading cryptocurrencies? I am a long term investospeculator of them myself but think day trading them might be a bit too high risk.||I assume you're referring to things like bitcoin. If not, I don't even know what a cryptocurrency is, lol. If so, I don't know anything about trading them nor do I care to. Like you said, they are extremely volatile and way too risky. I stay away from very risky investments like penny stocks and bitcoin and try to trade only things that have decent liquidity, are easy to get into and out of, and that are not going to be too susceptible to manipulation by people with way more money than me.|
|Yes I mean bitcoin and its similar alternatives e.g. "peercoin". I agree its definitely highly volatile and I'm quite skeptical myself, I do find it quite interesting though.||Yeah it is fascinating. I actually have a buddy who recently randomly threw $1k at bitcoin on the news that Congress was planning to make it a real currency (or something like that?) and tripled his money in three hours, haha. Fun stuff, but way too crazy for me.|
|Do you like showing people your fancy monitor setup when they come over?||Haha! Actually, I only have one monitor :) That setup that you see in the link in the main post is all I use. I flip between the trade tab where I actually click buy/sell and the charts tab which has three different charts on it (a daily, a 30 min and a 5 min chart) as needed. Generally, since I am day trading and not investing, I only care about the 5 minute chart for snap decisions. I will look at the 30 min and daily to find ideas and identify support/resistance levels on the chart but when I trade, probably about 75% of my time is spent on the screen you see which can all fit on a 15" laptop!|
|I do have a 24" external monitor which is usually what I'm using, and occasionally I'll open my laptop to throw up my google chats w/ other traders so I don't have to hit alt+tab 8 million times throughout the day. lol if I did have a fancy monitor setup though, I would definitely show it off!|
|In trading, KISS principle works best IMO :)|
|Congrats on making the leap! I'm a slow-motion swing trader by comparison, just a step below Graham-style buy and hold. I'm at the saving up stage until I can start playing weeklies with 5k or so. I thought it funny that your ama appeared close to one about flipping items from thrift stores on eBay, as that's what I do now. My question would be, how often do you rebuild your watch list, and how large do you let it get? I know some traders who've been making a living on maybe 5 different stocks a year for the past decade. I like your thoughts on why you're not branching into options yet- when something works, you don't put it down to go try something else! You said you like to get out of the house sometimes while trading- do you ever have issues with WiFi speeds doing this? Or are your trades loose enough that a couple seconds one way or the other isn't a big deal?||I rebuild my watchlist every night and mark stuff that I think is ready the next day. For any given day I usually only have 5-6 stocks that I am watching very closely. The rest are just kind of there as "back of my mind" ideas for later. At the end of the day if something didn't go then I will keep it on the list to stalk for a while and use those items if I run out of ideas during the day, to see if there are any opportunities in stuff I had been watching a couple days earlier. Then I usually wipe the whole thing clean and start over about once a month as it crosses 40-50 symbols because that just gets annoying and too much to manage. Interesting question about the wifi - yeah slippage can be annoying if I don't have a good connection, but I usually account for slippage in my position sizes so that if it slips a few cents it won't break me. If I have a slow connection I will usually scale back my risk and be more selective due to the added risk of disconnections, slippage, etc. That used to happen to me all the time at work: I worked in a lab where I couldn't have my cell phone and I'd be in a trade with no stop loss set (since I didn't want to get wicked out!) and the internet connection would randomly drop and I'd have to run out of the lab to get my phone and put in my stop loss or sell from my phone, lol. It cost me a bunch a couple times, so I started to take that into account when trading.|
|I also know traders who only trade 1-2 stocks and just know them so well that they can hit them over and over and make money for years. Those are a special breed of trader, IMO, and I would probably get bored out of my mind trading the same symbol every day lol.|
|Do you find technical analysis to provide reliable indicators of stock movements?||I do find technical analysis to be reliable. It is a self fulfilling prophecy in a large way so it doesn't really provide any sound long term strategy but for short term strategy it works great. I use probably 98% technical analysis in my trading. EDIT: To clarify I mean that technical analysis is not a reason to make a long term investment in any one stock or financial instrument. However technical analysis can be used to make consistent short term gains over the long term.|
|Have you ever traded options, and what is your opinion of them?||I've never traded options. I hear they are great for reducing risk and capitalizing with a small account but my philosophy in the market is to do what works until it doesn't work anymore. For me, trading equities has worked well so I'll keep doing that until it doesn't. Maybe someday I will get into options, but I have no plan to do that currently.|
|I don't know if I've ever heard a trader say it could be boring to only have a couple companies to worry about! That worries me more, having dozens and trying to keep an eye on all of them.||Haha it's a personal thing I guess! I guess it could be nice to trade the same company over and over again but I like the excitement of finding new ideas all the time and the challenge of learning about different companies and how they behave in the market. I have even traded some companies that turned out to be total frauds and it's funny to me because I look back and see that almost all my trades in them were shorts and when they finally get crushed I am like HA! I KNEW IT!|
|I appreciate the ama, I'll be checking out your site.||Thanks for the kind words - this AMA is a ton of fun.|
|Thanks for the detailed reply! I'm looking into trading and learning about options and the thinkorswim platform.||Really interesting stuff. Perhaps in 30 years I will lose faith in technical analysis as well. Really though, I am pretty confident because more than I trust technical analysis I trust my risk management skills, and they, not technical analysis or fundamental analysis or economic analysis or anything else, are what ultimately make me my money.|
|So you've managed to be in the green during the years when any idiot could throw darts at a dart board for stock picks and derive gains. What happens when a bear market comes along?||LOL I love my haters/doubters, why are u all so inept? I do BETTER IN BEAR MARKETS, I'M A SHORT SELLER YOU MORON! LOLOLOLOLOL.|
|You also manage less than $4M and only have $1M in your trading accounts right now. I wouldn't trust a lot of the people I know with more than that in their accounts for advice (and neither would they, that's why their money is managed by others). So, what exactly is it that makes you qualified to give advice for long term success for other investors to follow you?||I could trade with $20 million and probly make $10-15 mil/year but then i wouldnt be able to teach which i love more.|
|Do you know the success rate of all of your subscribers as a whole, including the ones that didn't stick through your "program", do you have any stats? Not just the two millionaires?||U can see alll my students trades, add up the profits, go fetch, Link to profit.ly|
|LOL I love my haters/doubters, why are u all so inept? I do BETTER IN BEAR MARKETS, I'M A SHORT SELLER YOU MORON! LOLOLOLOLOL. As a sell-side analyst who has worked on Wall Street for several years and has met analysts and portfolio managers at the largest hedge funds and investment banks in the world, I'd like to ask everyone reading this a question: would you entrust your life savings to a guy who talks like this? Do you think the people at Goldman Sachs or Third Point talk like this?||The good thing is i dont manage other people's money, all i do is teach lessons i've learned over 15 years...ignore my rules at your own risk, nobody forces u to learn them...|
|How did that hedge fund you started work out?||I was the #1 ranked short bias hedge fund for 3 years and then tried investing as i got too greedy...overall made 2%/year over 4 years, still #1 ranked in my category, see details Link to tim.ly i accept your apology for your laziness.|
|I do BETTER IN BEAR MARKETS. Have you traded in a bear market before? Because to me it looks like you started trading shortly after the crash. i could trade with $20 million and probly make $10-15 mil/year. Then why not put more money into your trading account, it's not like holding more than half your in assets in cash is somehow going to improve your awesome performance? but then i wouldnt be able to teach which i love more. If you love it so much, why don't you offer it at a more discounted rate than $1200/year per person? For that much money most people could buy all the best investing books on the shelves. Are yours somehow better than everyone who has come before you? As well, at $1200/year, if you only have 10k in your account, that's 12%/year. For 12% a year you could hire some of the best money managers in the world, or even for a flat rate fee, you could find at least a half-decent financial planner. What advantages do you offer over those people? u can see alll my students trades, add up the profits. After factoring in relative risk, and performance relative to the market, how does this fare? I mean if all your students at so successful why not display that front and center on your page, I'm sure it'd draw in more customers and there would be more faith in your advice. Your own success and the success of a few hand picked students isn't a lot to go on. How do you become a better sprinter, do you ask the world's fastest sprinter, or their coaches? Do you judge these coaches based on the performance of the most skilled students (who likely had an innate ability to begin with), or do you assess them based on the sustained increase in performance across the board, relative to other coaches? Generally the guy with $500k in his bank account is going to have an easier time making 1M than the guy with $5k in his account is. I'm not hating on you, I'm just asking why some of this data hasn't been gathered to show just how successful your students have been, relative to the rest of the people in the markets they've been trading in. go fetch. Are you aware of what selection bias and survivorship bias are? Also have you considered offering a full refund for people who have blown up their account after buying your books? Where do you see your investment future headed with these sizable gains so quick in your short career? Do you think your performance will compare to that of Berkshire Hathaway, or the Medallion Fund in the long term?||Yes i've traded bear markets, i made my 2nd million dollars 2000-2002, u have a long comment but u didnt bother researching me so i have no time for lazy people, sorry!|
|In the wake of Flash Boys, if you could recreate the market to your specs how would you want it? Single exchange? No maketaker? No darks? Trading pauses? Cancel fees? No Internalization?||People whine too much, i could care less about HFTs.|
|Why does google have more scam accusations than success stories when I search your name?||Because i expose scams and those scammers spread lies...already sued one penny stock promoter and won, but their skillset is spreading misinformation on the internet so it works well to smear me...but they couldnt stop Link to tim.ly or Link to tim.ly and as i create more millionaires, more people will realize i'm 100% right...until then let the haterade flowww.|
|I love how so many of the people asking questions here are ~5 hour old accounts...Got a bunch of your students pumping and dumping your AMA too?||I just sent the link out to everyone we dont give a crap about reddit, stupid hater.|
|My question keeps disappearing for some reason. ??? On a $15,000 account, what position size ($) would you risk, max, and what % gain target would you shoot for to minimize risk in partial fills/no-fills? I know this depends greatly on volume.||I answered it in long before, no time for double questions.|
|You are quite the heartless prick. You publicly laugh at all the traders when your short brigade tanks a stock price. Has anyone recognized you in public, walked up and threatened you?||Nah actually everyone who meets me is very thankful for my tireless work and EDUCATION...anyone who hates on education deserves to be poor.|
|Do you want to eventually settle down with a wife and have kids and get out of the spotlight?? And do you ever get tired of the fame?||Of course but i never get tired of trading/teaching.|
|What indicators do you use to find earnings/contract winners? What news sources do you read through? How do you find them?||Go watch Link to timothysykes.com|
|2pac or biggie?||Eminem.|
|If you're so fucking rich why do you need to sell shit? Why did you make this AMA? To get more customers. Those who can't do, teach.||Link to www.timothysykes.com|
|You're a typical lazy, inept hater, u accuse before u do research, sad.|
|Tim, big fan, love the instagram photos. Quick question, why not use options to position for trades (assuming they are availalbe in a particular name at all), rather than long/short? I've had problems getting margin approval (long story) even though i make six figures a year, so buying calls and puts is where im at right now. thoughts? Less serious question, "on a scale of Moses to Hitler" (Andy Samburg quote), how Jewish do you consider yourself? Favorite brand of coffee? Favorite toy?||My stocks arent usually optionable, oh how i wish they were :) i dont drink coffee and no time for toys.|
|TIM SYKES. If you had a son or daughter, which majors would you want them to study? STEM field? Liberal arts? Other. Pic related: Link to i.imgur.com.||College is useless, I'd want them to live and learn in the real world.|
|How was the conversation with Wolf when you guys ended the little Twitter war? What caused that whole mess?||It was me probing whether he was a stock promoter or not and i'm confident that he's just a naive newbie.|
|Are you familiar with BullsOnWallstreet? What do you think of their trading education, chatroom, and hedgefund?||Yah, nice guys but i dont know their teachings/track record, try to get them to post publicly on profitly.|
|What % of your income is from trading, what % from subscribers/dvds/marketing etc.?||Link to mixergy.com|
|Hi Tim, what advice would you give a new trader with a very small account ~$500. on the best way to grow the account over time?||Focus on volatile stocks and realize my top student started with just $1500 and turned it into $1.71 million in 3 years...anything is possible if u study and work ahrd.|
|Tim, what is the tech analysis software you use in all of your video lessons. Is it thinkorswim?||Its Etrade PRO but I don't recommend them -- I only use them as I'm superstitious and have made too many millions of dollars with them over 15 years...Otherwise I'd recommend Link to stockstotrade.co as it has great scanning/screening tools too.|
|Tim, as happy as I've been with my Silver sub so far, I was a day trader for four years in forex and am a bit burned out on it. But I do love swing and positional trading and have really fallen in love with options over the last six months. Right now I am thisclose to buying Tim Longterm. Do you get a lot of optional stocks in the TL program?||Cool yes timlongterm has more optional stocks.|
|How did you become interested in the stock market?||Read Link to timothysykes.com|
|How has your self-made wealth changed your lifestyle?||Yes i live very well now :)|
|Where do you see yourself in five years?||Depends how many millionaire students i can create.|
|Was trading stocks your first career choice?||I never thought about careers, i just made a ton of $ when i was young and liked doing that so i wanted to do it more.|
|Tim, I've been a silver sub for about three weeks now and have made some nice trades and done well so far, including a sweet +13% on ARTX (would have made more if I'd waited for it to break support). But I haven't seen any of the big-spike penny pumps happening so far. How often do you see them happening?||Cool, big spike penny pumps were every day in dec, jan, feb...they'll be back but u just missed the busiest season in 15 years.|
|How would you invest / what would you buy for $100 ?||I'd buy a good sushi lunch for that amount, it's too low for stocks.|
|How much does it cost to become one of your students?||Go look Link to timothysykes.com prices rising soon too so i'd lock in current prices for life if i were u.|
|I should've clarified, how much is it to become one of your millionaire challenge students?||Depends, we offer different options, gotta apply and be accepted first anyway.|
|Differences between the Tim Sykes Challenge and the silver membership?||See Link to timothysykes.com|
|Do you regularly give talks/seminars at colleges and universities. Would you ever consider coming to a smaller university to give a lecture on stock trading and smart investing?||Yes hit up Link to timothysykes.com|
|What do you think about forex? I just started larning about forex, because here in méxico there is not much information about penny stocks; and As i said before I want to make the amount to take you challenge.||Too low odds of success for me to care.|
|How backed up are your email responses for trader challenge requests? And what is the difference between silver and being accepted into the challenge. And by differences i'm referring to benefits.||75,000 emails or so.|
|Thoughts on fspm?||Below technical resistance so its irrelevant.|
|When you were growing up Tim, in your teens, did you look into the future and want to be wealthy? Was it a dream of yours to be where you are today or did you decide so much later on?||Always wanted to be wealthy, thought i needed to go to a good school & get job on wall street to make it happen.|
|When you first started out.. How did you handle the stress when you weren't trading? I'm having some crazy up days $12k+ and then when I make a shitty trade and lose $3k I wanna throw something...||No stress if u stick to rules...i didnt have rules at first and that was stressful...i didnt have a mentor either...luckily for u with me in the picture u now have both :)|
|Dear Tim, I have a dream of making an automated trading machine out of your system, I have experience and the trading floor access. In your opinion, why shouldn't it work ? (I can automate: market research, stock picks, technical indicators, risk management, money management etc.)||Do it up, i'm sure it would work I just havent had the time and I'm more interested in teaching people to be self-sufficient.|
|When did you start trading?||Go read Link to timothysykes.com and stop being so lazy.|
|Would you accept a deal to start being your student? I sent an email but i'd like to know what do you think, if the answer is not, it's ok; but i want to know what do you think;||No time for deals, only looking for dedicated students.|
|Any plans to expand the conference / speaking opportunities for you and your other gurus? I loved the Vegas event and think there is a large opportunity for smaller, regional Saturday events. Thoughts?||Ha nah in person events are a biatch, focus on online teaching is better.|
|I have to ask how often do you check twitter for hot news/tips? Also have you heard of Mark Gomes he is more like long term investor. I can't do margin on my ira so lose out on a lot of opportunities when trading. Gotta let the funds settle.||I could care less about news/tips, I'm ALWAYS searching for good patterns though.|
|Amazing call on artx I'm now number 1 in my finance class stock game||Nice!|
|I'm 23 years old, looking for stock investment options. What type of stocks should I be looking at with about $500 to spend?||Nothing, forget about investing with $500 and learn trading, watch these free videos Link to tim.ly|
|On a $15,000 account, what position size ($) would you risk, max, and what % gain target would you shoot for to minimize risk in partial fills/no-fills? I know this depends greatly on volume.||I am more aggressive in my trading when my account is small, I'd use 30-50% per play but watch the play like a hawk...for example I shorted ARTX yesterday at 4.50, today it dropped to 3.90...if i had $15k I would've shorted 1,500 at 4.50 and tried to cover at 4ish today to lock in $750 profit...then rinse and repeat and gradually grow the account.|
|How much money do you have in your checking account right now?||I dunno exactly, a few million last time I checked.|
|How often do you take money out of your trading account to spend? monthly, quarterly, annually or as needed?||Annually.|
|Hey Tim I am a big follower of yours on twitter and am considering purchasing your news letter. I got lucky and got in some marijuana stock in November and pretty much didn't look at it until February when I sold. I quickly found out how lucky I was afterwards by not taking profits on other stocks I had purchased. I was looking for another 10 bagger and quickly realized how rare it is for that to happen. My question for you is what type of percentage gains do you look for before securing profit?||Nice, normally i go for 10-30% gains, watch Link to tim.ly|
|What is the best product on your site to strictly see your stock picks? The best bang for my buck?||My newsletters at Link to timothysykes.com but picks do little good without knowledge/education behind WHY I am trading them.|
|Last one from me. I know you say to not be long before ERs but what do you think about Facebook with their upcoming ER ? Last time they jumped $10 but with the WhatsApp acquisition their stock has fallen back to where it was before last ER.||Don't guess on earnings.|
|You say college is useless, and I agree. What do you think should change in the education system to make it more relevant?||I'm doing EXACTLY what i think more teachers and their students should be doing.|
|What's the douchiest thing you've ever seen?||Too many characters needed, basically any Wall Street/Murray Hill party/event.|
|What would happen if too many people caught on to your short sale strategy? What strategy would you then adopt?||I was hoping that would happen when I first got into teaching so I could get more sleep! Sadly only a few people take the time to learn...I also buy and am up 100% in 4 months in 2014 mostly buying too.|
|Where can I find more information about the event in Harvard? Just moved to Boston.||U cant it sold out within minutes but we'll have it recorded for ya!|
|Thank you for the AMA and your reply. I bought your DVDs recently, but haven't finished. What ratio would you say your income is based on, trading vs. teaching? I ask because I think I would prefer teaching, but I need to learn first. So should I be learning to teach, or learning to just invest personally?||Teaching vs trading is something like 10-1...the cool thing is EVERYONE wants to be rich, the sad part is not many are willing to study hard to get there.|
|Hey TIM, I am a Pennystocking Silver member for about 2 months now and have been trying to figure out what is the maximum size position you can take when long on a stock? How do you know when to buy 100 shares or 100,000 shares? I have been making sure not to buy more than 2% of a stocks daily trading volume, I think I heard that in one of your DVDs, is that accurate?||There is no set maximum or minimum, every play is different...just gotta be comfortable and understand your risk/reward BEFORE making the trade and then stick to the rules during the trade.|
|Any recommendation to control overtrading? Btw I am flying all the way from Miami to Boston to be at Harvard on saturday, someday not too far I will be one of your top students :)||As I say in my Link to timothysykes.com DVDs, I try to think of myself as a retired trader who only comes out of retirement for the perfect setups when I know I'll feel guilty missing...otherwise I'm retired ALL the time, understand?|
|In An American Hedge Fund you mention that you met a trading coach at a large hedge fund you were interviewing for. Later you said you bought all his books. Would reccommend his books/ mind sharing his name?||It was Dr. Ari Kiev, sadly he died, but he's written some great books, use Google.|
|Besides your book that I enjoyed, do you have a few other books you would recommend?||Yes go read Link to investimonials.com|
|How did you know to short it since it gapped down right at open?||I shorted yesterday, see my video lesson I sent out mid-day yesterday too.|
|How long do you think BIOF will stay up before it will start going down? and what is holding it so far?||Irrelevant chart pattern, gotta focus on Link to tim.ly patterns if you want better odds.|
|Tim! Which actress do you think is the hottest? I like Scarlett Johansson a lot! (and thanks for changing my life!)||Nobody can compete with my girlfriend :)|
|Make sure she reads that post ;)||I will :)|
|Who would win in a fight you or superman(supertrades)?||Superman, he's strong and fit, I'm overworked and out of shape.|
|Here's my question: What is your favourite stock? Also you should come into this chat: Link to webchat.freenode.net. It is the official unofficial chat for /wallstreetbets -- a sub which adores your trading style. Thanks for taking the time.||Link to tim.ly|
|Hey Tim, huge fan, ive watched ALL of your DvD's expect for the how to read SEC filings. And i've been following your exact strategy for finding stock picks that you showed in your TIMfundamentals part deux DvD but i never find the same one's that you trade, for example ARTX did not come up on my watchlist. Did you change your strategy on finding stock picks? If so, what's new?||Link to profit.ly|
|Have you ever considered world domination?||Nah thats boring, my focus is world education.|
|I haven't read all about the challenge information yet, but how much is the amount I have to bring in ?||Different for everyone first u need to apply and get accepted Link to tim.ly|
|Can you make a gif animation of you flying to da moon and post it every time you tell us your stock picks?||Sure I'll put it on my to do list.|
|Tim I am I college student and I started trading this year mostly because of your story. I have bought into the company TWD (tweed marijuana inc.) Do you have any suggestions for me? Ps, they're all just haters.||Cool, the companies don't matter and TWD's chart is a mess, focus on Link to tim.ly patterns.|
|Right on, is the Vegas conference going to be a DVD also this year or is that the video you are talking about? BTW can't wait for the conference this year hopefully its the best one yet.||Nah brand new DVD going over all the basics.|
|I'm low on funds so more newsletters or getting equity feed? About the same price so just pick one||Data is cheap, good information from newsletters is more useful, use Link to tim.ly sale while its still on.|
|Hey Tim, I was accepted to your challenge but was unaware about needing $7500 to begin. Any way around that? I think what you do and how you help people is great. I'm guessing you have someone answering your emails so I thought this was the best way. Thanks.||Gotta invest in your financial education, my program is a steal given the value of what u learn...skimp out on everything in life, but not education.|
|To start off, you are my biggest inspiration for trading stocks. That being said, in the future I would love to trade with you like Tim G and your other students in the Maldives or other crazy places you go. I currently trade my own strategies and am making pretty good money. Do I need to become one of your challenge students to hang out/trade with you?||Yup Link to tim.ly students get first dibs on everything.|
|Hi Tim, TimAlerts subscriber here, When you started out with $12,500 what was the lowest your account went to in the beginning, did your ever drop below $10,000 ?||Go and look at the first 1,000 blog posts on Link to timothysykes.co i tracked EVERY trade.|
|Hello Tim, Big fan here & Silver Subscriber! Been watching a lot of your videos and I've read your book. I live in Denmark, so a lot of brokers won't accept me as a customer. Only broker I can find is SureTrader. What do you think?||Cool i use suretrader they have shorts every now and then.|
|Do you lift?||I used to, no time now.|
|Tim! I've been following you now for a while and have learned a great deal from you! I live in Boston and would love to come see your talk! Is there ANY WAY I can get a ticket??||Cool, sorry my Harvard talk sold out within minutes, but it'll be recorded.|
|What trading platform do you use?||Read Link to tim.ly multiple brokers.|
|What is the best path i should take if i want to be sitting beside you on your next yacht adventure?||Apply at Link to tim.ly then study your butt off!|
|Do you watch game of thrones? If not you should get on it.||Yes its great, wish I had more time to watch them all a second time.|
|What do you think about the wild west of cannabis stock trading and do you think that it stands apart from the internet .com boom since it is ACTUAL product as opposed to a dozen guys in an office? Are they good for long term investments aside from possible law retractions being an obvious danger?||Just the latest stock market sector craze, little different from nanotechs, 3d printing oil, gold, ethanol, alternative energy...pump and dump, NOT longterm holds.|
|How long will your 60% off newsletter be on? I want to buy it but my money is locked up in the market and will take about a week for me to have enough to get it. tia||Just a few days more we cant have Link to tim.ly sale last forever!|
|Thanks for doing your AMA Tim! I currently am a TimAlerts subscriber and saving money to start trading some day as a (succesfull) European student of yours. I saw you are going to speak at Harvard in a few days, will there be a video of it afterwards?||Cool yes my Harvard speech will be recorded!|
|Why are they not longterm holds? because its the early stages of the industries development?||Theyre mostly scams and pump and dumps, development my ass LOL.|
|Any plans on doing a seminar anywhere on the West Coast some time soon?||Yes hit up Link to timothysykes.com to be added to the earlybird list.|
|Question - how did you manage to post losses of almost 40% in '06/07 when the market was doing so incredibly well?||I'm a short seller for one and second read Link to tim.ly I detail my losses in depth.|
|Timothy. My mentor. Why your loosing trades show profit in your page ? 4/10 MDBX $23.25 $22.1 $4365. Tell me how you enter at 23.25 and exit at 22.1 making $4365 in profit please. You have to teach me this magic !!||It's called short selling you incredible nitwit.|
|How much money do you make in a year from your DVDs, trading challenge, and subscriber alerts?||Link to mixergy.com|
|I lost 70% on SPLI, 40% on ERBB, and, 40% on MYEC, and 30% on MINE, should i hold?||Sorry to hear, they can always come back, but I wouldn't bet on it...gotta learn my Link to tim.ly rule #1 cut losses quickly.|
|I'm a college senior. Would you recommend me working at an investment bank or tech startup?||Do both, make connections everywhere.|
|What characteristics do you look for when people apply to your "Tim Challenge?"||Dedication, ability to follow instructions, hunger for immense wealth.|
|How many cars do you have?||I have 2, a Lamborghini and Porsche.|
|Is e-gear hard to drive? I have a automatic setup on my cayman s.||Nah its easy.|
|Can you annotate a chart of any instrument with price action or indicators?||Yes.|
|Tim, you have mentioned you have students from outside the US. Have you recommended them any brokers in particular or do you happen to know witch they use? Trading the OTC seems to be a common problem for us folks outside the US. Any input on this would be appreciated.||My preferred Link to tim.ly all accept international customers.|
|Hi Tim, NEWBIE. What brokerage account do you recommend? Thanks||Read Link to tim.ly|
|Actually didn't know that. Thank you for your time Tim.||YES!|
|Can my girlfriend borrow $500 to adopt her dog?||Nope.|
|Hey Tim, I am a Pennystocking Silver subscriber and newbie to trading, and have been studying your teachings for about a month. Thank you for doing this AMA. In your book you say that the most valuable classes you took in college were micro and macro economics. I am an econ major and am curious as to how you apply econ theory to trading. Why do you value those classes so much, and what is the most important economic concept you apply to trading?||Cool always important to know supply/demand, that basically sums up all of penny stocks.|
Trading on margin is a risky business, but can be profitable if managed properly, and more importantly, if a trader does not overleverage themself. Learn how personal loan interest rates work For each trade made in a margin account, we use all available cash and sweep funds first and then charge the customer the current margin interest rate on the balance of the funds required to fill the order. The minimum equity requirement for a margin account is $2,000. Please read more information regarding the risks of trading on margin. Trading on margin involves risk, including the possible loss of more money than you have deposited. In addition, E*TRADE Securities can force the sale of any securities in your account without contacting you if your equity falls below required levels, and you are not entitled to an extension of time in the event of a margin call. How does the price of a particular company's stock compare to the stock of other companies in the same type of business, or sector (e.g., technology or energy)? If the price of your first stock is overvalued or outside your target range, there may be other opportunities to invest in similar companies that have more attractive evaluations. Ordinary investing and trading accounts cost $9.99 to open as of 2014, while Plus Pro Elite investment accounts cost between $7.99 and $9.99. You need a $500 initial deposit to open individual, custodial or joint brokerage accounts as of 2014. Futures trading and forex trading accounts require $10,000 and $2,000 initial deposits, respectively.
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One trading jargon that you’ll hear very often is margin. It’s usually in terms like margin account, margin trading and even margin call. It seems a bit comp... Today we will cover the basics of margin for active traders. Using margin can be an amazing advantage but you should be aware of how it actually works to avo... Step by step of what gross margin and how to use it. I compare Apple and Microsoft gross margin.