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Hey guys what's up everyone I haven't made a blog in ages! This place has changed a lot I probably won't know who any of you are.
So anyways, with the fall of online poker I took it easy for a while, joined the air force, and now I am doing that which is ok. But I don't make much money and I want more more more! So I decided to take up online trading.
I started off by educating myself and playing around with demos a little bit. And I settled on doing binary options for now, which I am having a lot of fun with and frankly don't seem that difficult to beat though maybe I am running good to start off. I think having a professional poker background helps a lot in many ways.
Some people will argue that binary options aren't really trading, and I will agree with them.. but for intents and purposes it is easier to lump them in with the other types of tradings.
All of this is probably confusing for a lot of people but I didn't want to write a million pages explaining what online trading is and the different types so if you have questions just ask me.
I am wondering how many of you out there seriously trade online, and what do you do? Do any of you do it for a living? I could see myself doing this for a living one day, I do not want to stay in the air force forever.. It's ok but I don't want to make this too long term, I like independence. So anyways let's get to talking about this.
 
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United States24755 Posts
I trade options, but not seriously. Honestly, I've never even heard about binary options before.
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Don't know dick about trading but I'm about to be in the air force as well. Maybe you could blog about it, would be interesting.
Hope things are going well for you.
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Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do?
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I do what i suppose people think "daytrading" is for a living
Though, even though my style of trading is as close as it gets to that, it's *nowhere near* what retail trading is
Trading as a retail investor/trader is 99.9% scam. The vast majority of products you will trade will have huge spreads/costs and be impossible for you (or anyone else) to trade profitably from
As an example, for every £1 in net profit i make, i've spent 50p to make it. This is considering i get the absolute lowest costs in the industry (eg, for an oil contract, i'll be paying somewhere between 125c to 45c a lot) Considering as a retail investor you might have to pay many, many, multiples of this, you can quickly see where the maths adds up.
As for binary options in particular, i do know ONE guy who works in a hedge fund who has some crazy algorithm that has an edge in binary options trading, but in general, the costs of options are *even more* extreme than normal futures trading.
pretty much all the guys i know who make money from options are basically market makers that have fancy ways of taking the bid/offer spread and are generally doing some kind of arbitrage
Hell, where i work,99% of the trading that goes around me is just spread arbitrage (feel free to ask if you're confused), which is impossible for a retail investor.
The only way to get these costs is to invest a large sum of your own money (something like 50k dollars is probably enough, depending on how margin heavy your strategy is) to buy a desk at a prop firm (which will cost you something like 3000 dollars a month) to get the whole setup with the right software and costs.
Feel free to ask questions though. For some reason it's a hidden world and all the perceived entries and ways in are generally fakes/scams, especially if you're trying to do anything on the buyside
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On April 01 2013 08:44 travis wrote:
Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do?
whaaat. i thought you went to dli.
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From what I can see, binary options seems to be really scammy. It's basically simple gambling through small companies situated outside of the US, masquerading as investment. It's apparently common that it's very hard to withdraw money... and if you make a lot, you simply don't get it. There's no regulatory agencies or anything.
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On April 01 2013 09:18 Nitrogen wrote:Show nested quote +On April 01 2013 08:44 travis wrote:
Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do? whaaat. i thought you went to dli.
no I didn't make top secret security clearance lulz
On April 01 2013 09:27 Tobberoth wrote:
From what I can see, binary options seems to be really scammy. It's basically simple gambling through small companies situated outside of the US, masquerading as investment. It's apparently common that it's very hard to withdraw money... and if you make a lot, you simply don't get it. There's no regulatory agencies or anything.
sounds like you did some research. but just because the majority of people say something doesn't mean it's true. most people I talked to said the same stuff about poker.
binary options are not investing it's true, but that doesn't mean they are a scam. it is gaming, it is gambling like poker, but if you know what you are doing there are plenty of edges.
as for the sites, I did research before depositing. I trade on nadex at the moment, which is U.S. regulated, so really it's as "safe" as you are going to get.
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On April 01 2013 09:41 travis wrote:Show nested quote +On April 01 2013 09:18 Nitrogen wrote:On April 01 2013 08:44 travis wrote:
Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do? whaaat. i thought you went to dli. no I didn't make top secret security clearance lulz
oh wow that sucks. too many drugs?
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On April 01 2013 09:07 BrTarolg wrote:
I do what i suppose people think "daytrading" is for a living
Though, even though my style of trading is as close as it gets to that, it's *nowhere near* what retail trading is
Trading as a retail investor/trader is 99.9% scam. The vast majority of products you will trade will have huge spreads/costs and be impossible for you (or anyone else) to trade profitably from
As an example, for every £1 in net profit i make, i've spent 50p to make it. This is considering i get the absolute lowest costs in the industry (eg, for an oil contract, i'll be paying somewhere between 125c to 45c a lot) Considering as a retail investor you might have to pay many, many, multiples of this, you can quickly see where the maths adds up.
As for binary options in particular, i do know ONE guy who works in a hedge fund who has some crazy algorithm that has an edge in binary options trading, but in general, the costs of options are *even more* extreme than normal futures trading.
pretty much all the guys i know who make money from options are basically market makers that have fancy ways of taking the bid/offer spread and are generally doing some kind of arbitrage
Hell, where i work,99% of the trading that goes around me is just spread arbitrage (feel free to ask if you're confused), which is impossible for a retail investor.
The only way to get these costs is to invest a large sum of your own money (something like 50k dollars is probably enough, depending on how margin heavy your strategy is) to buy a desk at a prop firm (which will cost you something like 3000 dollars a month) to get the whole setup with the right software and costs.
Feel free to ask questions though. For some reason it's a hidden world and all the perceived entries and ways in are generally fakes/scams, especially if you're trying to do anything on the buyside
I don't see how the costs/fees for binary options are too high. what kind of win rates on bets do you think are attainable? Why are you making it sound like it's so much harder to win than it seems to me.
On April 01 2013 09:47 Nitrogen wrote:Show nested quote +On April 01 2013 09:41 travis wrote:On April 01 2013 09:18 Nitrogen wrote:On April 01 2013 08:44 travis wrote:
Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do? whaaat. i thought you went to dli. no I didn't make top secret security clearance lulz oh wow that sucks. too many drugs?
yep. it's probably a blessing in disguise anyways. the school for it is very unpleasant and difficult from what I hear, and I don't even want to stay in for my full 6 year enlistment anyways.
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On April 01 2013 09:53 travis wrote:Show nested quote +On April 01 2013 09:47 Nitrogen wrote:On April 01 2013 09:41 travis wrote:On April 01 2013 09:18 Nitrogen wrote:On April 01 2013 08:44 travis wrote:
Air force is great, my office is pretty laid back. I do finance.
Any idea what job you are going to do? whaaat. i thought you went to dli. no I didn't make top secret security clearance lulz oh wow that sucks. too many drugs? yep. it's probably a blessing in disguise anyways. the school for it is very unpleasant and difficult from what I hear, and I don't even want to stay in for my full 6 year enlistment anyways.
haha, it's not too bad, but it's definitely shittier for the air force. they have a bunch of rules that make no sense and make their lives shitty. i fortunately never had to deal with that though (army). the school itself isn't bad. how are you gonna get out before your contract is up?
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I don't know, I am just assuming I probably can with all the current and upcoming budget cuts. I've gotten emails about programs to get out but I was always too busy to actually read them lol. Besides I am not ready to get out just quite yet.
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Travis, you may be a high probability target for brainwashing. Go read Luckyfool's blog and become aware of your unawareness.
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On April 01 2013 10:04 travis wrote:
I don't know, I am just assuming I probably can with all the current and upcoming budget cuts. I've gotten emails about programs to get out but I was always too busy to actually read them lol. Besides I am not ready to get out just quite yet.
wow i didn't realize there were programs to get out. seems like it makes more sense than kicking people out, just let the people who want to get out get out. dunno if the army has that though, makes too much sense.
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On April 01 2013 10:48 husniack wrote:
Travis, you may be a high probability target for brainwashing. Go read Luckyfool's blog and become aware of your unawareness.
i went to go read it and then got bored like 3 sentences in
also, wtf are you talking about. lol
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Did some speculation on german bluechip stocks during spring last year, earned around 150 € in the process of 3-4 months after having losses, initially, then I had to pull out all money from stocks cause of family shit, just before stocks started rising to this pretty sick point, sigh. Was more of a testrun to see how it is though.
Never tried out options but I think they're not much different from playing poker (not gonna touch them without reading about them), as for arbitrage, I guess futures could be seen as such, kinda.
Lessons learned so far: Never, ever trust whatever advice a bank gives to you (got some advice that turned out super shitty, didn't follow most of that luckily).
Edit: Trading is mostly automated nowadays and happens super quickly. I have actually no idea which groups use such programs the most.
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On April 01 2013 09:53 travis wrote:Show nested quote +On April 01 2013 09:07 BrTarolg wrote:
I do what i suppose people think "daytrading" is for a living
Though, even though my style of trading is as close as it gets to that, it's *nowhere near* what retail trading is
Trading as a retail investor/trader is 99.9% scam. The vast majority of products you will trade will have huge spreads/costs and be impossible for you (or anyone else) to trade profitably from
As an example, for every £1 in net profit i make, i've spent 50p to make it. This is considering i get the absolute lowest costs in the industry (eg, for an oil contract, i'll be paying somewhere between 125c to 45c a lot) Considering as a retail investor you might have to pay many, many, multiples of this, you can quickly see where the maths adds up.
As for binary options in particular, i do know ONE guy who works in a hedge fund who has some crazy algorithm that has an edge in binary options trading, but in general, the costs of options are *even more* extreme than normal futures trading.
pretty much all the guys i know who make money from options are basically market makers that have fancy ways of taking the bid/offer spread and are generally doing some kind of arbitrage
Hell, where i work,99% of the trading that goes around me is just spread arbitrage (feel free to ask if you're confused), which is impossible for a retail investor.
The only way to get these costs is to invest a large sum of your own money (something like 50k dollars is probably enough, depending on how margin heavy your strategy is) to buy a desk at a prop firm (which will cost you something like 3000 dollars a month) to get the whole setup with the right software and costs.
Feel free to ask questions though. For some reason it's a hidden world and all the perceived entries and ways in are generally fakes/scams, especially if you're trying to do anything on the buyside I don't see how the costs/fees for binary options are too high. what kind of win rates on bets do you think are attainable? Why are you making it sound like it's so much harder to win than it seems to me.
The best way i can describe it is imagine playing poker with 5x rake or something crazy like that. It may seem like you can win (and certainly, you can definitely be better than the players on the table, whom you can directly observe), but as you know, you will have a very, very tough time beating a rake that high
The main issue with trading is that it is very, very difficult to quantify your edge. You need a long track record that takes account for variance and sharpe ratio.
Also you can't say after every trade whether you know you made a +EV decision or not. Unlike an all-in situation where you get to see the cards afterwards and assign probabilities and EV to each player, in trading all you get to see is the market movement, and you have no way of knowing whether there was any probability that it goes in your favour or not
So given this, one has to think "well hot damn, how do you make money from trading?" - that's a very good question.
So you have to think outside the box a little bit and try to wonder who makes money
Well for a start in poker, the casino makes money because they take rake out of the pot. And that is exactly what the vast majority of options traders do - they "make the market" or act as the house and offer you options to trade with. They get the "good price" when you trade with them, but of course you get the choice.
If you assume that the market is a truly random walk, then this is in effectiveness, betting on red or black with roulette, where the market maker gives you the choice to bet on red or black (and charges an extra bit - the green 0), knowing that the market is random enough you have no way of effectively predicting red or black on the next roll of the market.
This is essentially part of what they call "statistical arbitrage strategy" - using pricing models they can make sure that the prices that they set are always outside of the neutral EV price, so that no matter which way you hit them (buy or sell) they will have made a +EV decision.
Now of course, markets ARNT 100% random walk - but a market maker can hedge his position very quickly after you take the bet with him, so he "locks in" that edge, and then no longer cares whether he makes or loses on the original bet (the simplest form is known as delta hedging, but options guys do all sorts of crazy shit i dont know about)
So far, you can safely assume that being the house is a fairly profitable way of trading.
And this is indeed, how all investment banks make money from trading (they act as the house) - and how your broker/platform makes money from trading
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Without having seen trading ladders, it is very difficult to describe prop trading to you (and the rest of the buyside industry)
In the world of prop trading (or what you might imagine as intra-day trading) they still face a similar problem, so they actually have to find some kind of market edge.
Generally these guys boil it down into the simplest edge possible, so that they can fine tune it and roll it over again and again. Its usually something simple enough they can explain it in one sentence
For example "when market data comes out, the market moves, so i'm fast enough to buy/sell before everyone else" - These guys actually exist, and yes, they make huge amounts of money.
There used to be locals who would sit there with huge clips (thousands of lots) on markets that are heavily speculated and liquid (bund, SNP mini etc.) and just wait all day for market moving news, and they would press the button, make a quick 10-100k and then wait another month at their computer for the next opportunity.
Unfortunately these opportunities have become thinner and thinner with the rise of algorithms, but you can see what i mean
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And if you're wondering what i do, i sit on the bid and offer of extremely illiquid products that nobody except a few physical oil traders care about, and i wait and wait and wait until they hit my bid or offer
Essentially, i'm "market making", but i'm just doing it on the buyside.
Once i get hit, i hedge it up quickly to "lock in" that profit and then try and get out for a really small profit (usually 2-3 ticks)
That is, 2-3 ticks over the course of 2-3 weeks 
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I do econophysics w/ stocks. I make about a 3% profit most months, but it's not enough for me to live off of.
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Trading is very interesting stuff, how does one get started
Nymphaceae told me about once upon a time but i kind of forgot 
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United States24755 Posts
You start by losing lots of money.
In all seriousness don't trust what you hear online from people you barely know about trading... stick to people you know and trust in real life... and even then be cautious.
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EPT
