RETURNS OF THE DAY; HIGH-RISK TRADERS MEASURE DEALS IN HOURS OR MINUTES, BUT CAN ADD UP PROFITS IN THOUSANDS.Byline: Deborah Adamson Daily News Staff Writer Mary Curtin is not exactly the kind of person you'd imagine as a day trader Day Trader A stock trader who holds positions for a very short time (from minutes to hours) and makes numerous trades each day. Most trades are entered and closed out within the same day. Notes: This is a highly speculative practice. . After all, the tennis instructor and mother of two preteens doesn't fit the profile of the average trader: She's not single, and she's not a 25- to 35-year-old man. None of that matters to Curtin, who hopes to start trading soon. Right now, she's busy learning about it and working on a computer model to help her trade better. The Simi Valley Simi Valley (sē`mē, sĭm`ē), city (1990 pop. 100,217), Ventura co., SW Calif. in an oil, fruit, and farm region; laid out 1887, inc. 1969. resident hopes to eventually make a part-time career of it. ``I have two children and I want to be there after school for them,'' said Curtin, adding that it's not very lucrative for her to rely on tennis for additional income since the prime time for lessons is the afternoon. Her interest exemplifies the rising popularity of day trading Day trading Establishing and liquidating the same position or positions within one day's trading. to all sectors of the population, be they homemaker or professor. There are about 4,000 active day traders today, up from a little over 1,000 in 1996, said Jim Lee, president of the Electronic Traders Association in Washington, the industry's trade group. He's also president of day trading firm Momentum Securities Management in Houston. What makes the rise in popularity so startling star·tle v. star·tled, star·tling, star·tles v.tr. 1. To cause to make a quick involuntary movement or start. 2. To alarm, frighten, or surprise suddenly. See Synonyms at frighten. is that until very recently, only the most savvy and experienced investors attempted it. After all, day trading is a form of extremely short-term investing. A day trader buys stock and sells everything during the trading day In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. . The trader doesn't hold positions overnight. The idea is not to buy stocks whose long-term outlook is bright. It's to buy stocks that are expected to go up within the next few minutes or hours. The typical day trader is an unmarried male between the ages of 25 and 35, Lee said. He is highly educated - 97 percent have college degrees. Almost all had previous professional careers and they are financially secure. The average annual income is $121,140 and their net worth is $648,271, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a sampling of clients at Momentum Securities. How hot is day trading among the masses now? There have been two best-selling best·sell·er also best seller n. A product, such as a book, that is among those sold in the largest numbers. best books on the subject in recent months - ``The Electronic Day Trader'' by Marc Friedfertig and George West George West (February 17, 1823 - September 20, 1901) was a U.S. Representative from New York. Born in Bradninch, England, West attended the common schools. West immigrated to the United States in February 1849 and settled at Ballston Spa, New York. , and ``How to Get Started in Electronic Day Trading'' by David S. Nassar. Friedfertig and West are working on a follow-up book called ``Electronic Day Traders' Secrets.'' Nassar is also hard at work on his own follow-up day trading workbook work·book n. 1. A booklet containing problems and exercises that a student may work directly on the pages. 2. A manual containing operating instructions, as for an appliance or machine. 3. that will include instructional videos. There are workshops and classes as well. Tradingschool.com, a Glendora-based trading academy, sold out its $2,000 advanced trading class in January in one day. Company President Robert Deel, who's also a money manager and day trader, teaches the three-day workshop. What sparked all this interest in day trading? Nassar says advances in technology, a roaring bull market especially in the technology sector and dissatisfaction with mutual fund or broker performance have all contributed. Day trading really took off after the October 1987 crash, when investors couldn't get through to their brokers to sell shares because of jammed phone lines. The information crunch convinced Nasdaq to launch the Small Order Execution System, which gives small investors Small investor An individual person investing in small quantities of stock or bonds. This group of investors makes up a minimal fraction of total stock ownership. small investor limited access to trading information normally available only to major brokerage marketmakers. Traders can see the market's buy and sell, or bid and ask, prices. Bid is the price at which marketmakers will buy the stock from an investor. Ask or offer is the price at which they will sell it to you. Marketmakers profit from the difference or ``spread'' between what they bought it for and how much they sold it at. With SOES SOES See: Small Order Execution System SOES See Small Order Execution System (SOES). (pronounced like ``sows''), a trader can see the bid and ask prices. If traders use a high-speed phone line to enter orders, they can execute orders 1. An order issued by the Chairman of the Joint Chiefs of Staff, by the authority and at the direction of the Secretary of Defense, to implement a National Command Authorities decision to initiate military operations. 2. at the bid or ask. In contrast, investors who call or e-mail their order to their broker have to wait for the order to be processed. In the space of a few minutes, the prices could have changed. The popularity of SOES has led to the emergence of Electronic Communication Networks, such as Instinet and Island. These are systems that allow even greater access to trading information by small investors. With ECNs, traders can get access to so called ``Nasdaq Level II'' quotes. Not only do you get to see the bid and ask, you can also put in your own bid and ask and snatch snatch removal of a newborn animal from the dam before it has an opportunity to suck. The objective is to rear it independently and free of colostrum-borne infection or of colostral antibodies. profits away from the marketmaker. For example, if there's an offer to sell XYZ XYZ interj. Informal Used to indicate to someone that the zipper of his or her pants is open. [ex(amine) y(our) z(ipper).] Corp. stock at $49.875 and a bid to buy it for $49.50, the trader can sneak in Verb 1. sneak in - enter surreptitiously; "He sneaked in under cover of darkness"; "In this essay, the author's personal feelings creep in" creep in between the spread. The trader can offer to buy it at $49.625 and sell it for $49.75. That yields a profit of 12.5 cents, excluding commission. If the trader has 2,000 shares riding on it, that's a $250 profit on a few minutes of work. Sounds easy? Seems like a license to print money? But reality is quite different. In Momentum's study of its day traders, the company found out that 56 percent of them lost money in the first three months of trading. The average loss was almost $21,000. Deel estimates that as many as 92 percent lose money while Nassar puts the figure at 80 percent. But as traders gained knowledge and experience, the success rate got better. That is, providing that the trader still had enough money to play. Most traders lose money because they're not disciplined enough to follow an investment strategy. With tens of thousands of dollars riding on a typical trade, many can't take the heat when the stock starts diving. Instead of cutting their losses quickly, their emotions tell them to hope and wait for an upturn. But this could very quickly ruin a day trader. ``So many people don't have the discipline to sell their trades,'' Nassar said. ``Day traders who don't learn that in the beginning don't survive.'' It's easier said than done. Even with the knowledge that they should get out quickly if the situation is turning bad, somehow many still don't. Osama Nimer should know. The Thousand Oaks Thousand Oaks, residential city (1990 pop. 104,352), Ventura co., S Calif., in a farm area; inc. 1964. Avocados, citrus, vegetables, strawberries, and nursery products are grown. resident has been day trading for three years. ``The reality is, it's a lot of work,'' he said. ``Don't step into it until you know how to do it.'' His best one-day gain was $3,000. His worst loss? $10,000. Andrew Bui, a computer programmer and budding budding, type of grafting in which a plant bud is inserted under the bark of the stock (usually not more than a year old). It is best done when the bark will peel easily and the buds are mature, as in spring, late summer, or early autumn. day trader from Simi Valley, knows that he's going against incredible odds. But he's already an aggressive investor. Sometimes he doesn't sleep well at night because he worries about his investments. By being a day trader, he figures it will be easier on him since he'll sell all his positions by day end. He has studied several strategies and feels prepared to handle the task. ``I want to set my own hours, my own pace,'' he said. ``The goal is to be able to work a couple of hours a day.'' CAPTION(S): Photo PHOTO (Color) Mary Curtin of Simi Valley hopes day trading online from her Simi Valley home will make money while being there for her two children. David Sprague/Daily News |
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