The people who recklessly hit bid/asks are likely going to end up losing money. Part of these trades, especially on illiquid names is figuring out how to get the best possible fill.
Just an oversimplified example:
For a scalp trade on the original challenge acct, let’s assume a 50/50 win/loss, winning trades successfully scalp an average of 75c / contract / trade, losers cut at a loss of 50c / contract / trade. This averages out to a profit of 12.5c / contract / trade. There’s a lot of short term volatility, but once things smooth out you end up ahead. Say the bid-ask spread is an avg of 20 cents, and these trades filled at mid.
Someone who hits the bid and ask every time, is losing 10c each direction compared to mid. Now, their trades are still 50/50 win/loss, but the winners are only 55c and the losers lose 70c. Not good. This might win in the short term due to volatility, but you’ll eventually go bust from paying the massive spread every single trade.
It’s not immediately obvious that a nickel here, dime there matter, but when you trade this frequently those differences are massive!
Will you be setting up the streams again?
I loved watching how you picked the price to buy and sell.
If you do could you do more note on the charts as well, they were funny and knowledgeable.
This is a major issue, it’s also preventing me from properly acquiring positions since I average in. For instance today I had a LIMIT set to start a position in May calls and soon after it triggered the bid went nuts and hasn’t recovered.
What I’m hoping to do is better educate the members to not use MARKET orders and set LIMITs instead which would solve the problem. Otherwise we’re probably going to have to look into limiting the information given for entries and exits in some way.
I haven’t been in the headspace to type up my “retrospective” on my performance thus far but trading more in line with my normal strategy is something that is happening.
As for how I decide to take profit or cut it’s honestly somewhat of a binary process for me which breaks a “trade” into two parts:
The Opportunity - This is the overall trade, my reasoning or “what I’m in it for”. To make an analogy, I consider a trade a match or game.
The Moves - Within the opportunity I’m making trades like how you’d “take your turn” or “make a move” in a game, each move is it’s own independent trade which can have a timeframe much shorter than the overall opportunity and obviously a number greater than “one”.
So let’s think about BEEM. The “opportunity” is the short interest and minor social sentiment, so while that reasoning is still valid, the game is still on. I’ve made several “moves” within that opportunity which generally consists of seeking good entries and maintaining a good cost average and then taking profit on the way up or cutting fully when you get a pop with momentum which really is somewhat binary, if I’m up you’ll see me trim some and if it pops you’ll see me cut all more often than not.
However, this decision making is modified by how strongly I feel about the reasoning/opportunity. So right now with BEEM I’m watching it’s SPY correlation and factoring in how I’m anticipating a “bear market rally” on SPY which could potentially drive BEEM up a decent amount, I’m watching how BEEM has largely ignored SPY’s downward momentum throughout the day and how time is marching onward and the shorts are still solidly OTM on a stock that isn’t coming down and my final thought is that it’s only a matter of time until this probably catches social sentiment again. So at this moment I feel pretty strongly about the potential of the opportunity so I’m willing to “hold this move” for longer just in case it pans out how I’m seeing it in this moment. If some of that changes and I start to feel less confident in the opportunity, I’ll remove the “hold” and start taking profit and cutting as I did before.
This topic probably deserves it’s own thread which I’ll add to my list
The challenge alerts are on TF in discord there will also be a stream again soon.
Rephrase this for me, I’m not quite getting what you’re asking.
Streams are coming back next week as I’m going to be pushing and making an effort to be more active with the challenge then as well.
I was curious about the challenge account average on the NVDA April 22nd $250s and thought I’d check the numbers based on what the bot says.
After reviewing from what the bot says it says there have been 31 bought and 8 sold leaving 23 held. Bot command showing 25 @1.34.
Has the bot missed any new buys/had the wrong quantity? Or is it the positions command pulling wrong data?
I was also wondering if I missed a sell signal. I just started with the trades, so I am still holding some of those NVDA 4/22’s… probably going to dump tomorrow unless Conq comes back on and says different.
Would it be possible to have a weekly position statement posted for the challenge? It wouldn’t have to be the exact profit or loss for each position, but maybe Ticker, Call/Put, Qty, Date purchased, & Expiry? Just wondering. Thank you
