What do you think of traders?

[itcheroni]

Even before this economy, I had trouble getting a job. But I was fortunate enough to discover options trading a year ago and have recently been able to support myself fully on it. But when I explain what I do, people generally get a strange look on their face. I'm guessing it is because 1) they think trading/investing is somehow wrong or 2) they think my position is unpatriotic (I am short the dollar and long gold) or 3) it is merely a look of confusion because they don't know what I'm talking about.

I of course don't see anything wrong with trading options but I also don't want to derail a conversation that just started. I'm thinking it might be better to not say anything at all but then I would end up being cryptic about how I support myself. I may also be paranoid. I live in Berkeley so there aren't a lot of people interested in stocks and such and I feel as though some people here think it's even evil, which is just ludicrous to me.

 

[leekohler]

"Trader" is a broad term. If you're a trader at the Board of Trade here in Chicago, you're usually a huge alcoholic with severe mental problems. I'm not lying, you should meet some of these guys.

I assume you don't trade on a floor. Is that correct?

 

[itcheroni]

I trade in my underwear. But I really only "trade" once a month and wait for the next month to do something else. Or if there's an opportunity I can take advantage of. But I'm not just buying something and selling it the same day like most at home traders.

 

[leekohler]

I trade in my underwear. But I really only "trade" once a month and wait for the next month to do something else. Or if there's an opportunity I can take advantage of. But I'm not just buying something and selling it the same day like most at home traders.

Teach me how to do this. Sounds good to me. Good for you.

 

[Zombie Acorn]

I trade in my underwear. But I really only "trade" once a month and wait for the next month to do something else. Or if there's an opportunity I can take advantage of. But I'm not just buying something and selling it the same day like most at home traders.

Sound like more of an investor than a trader to me. When you say trader I am thinking of a day trader that does it as a full time job.

 

[itcheroni]

Teach me how to do this. Sounds good to me.

I have tried to tell all my friends to do this and almost all of them act like I'm trying to get them to turn tricks. In my mind I've found something incredibly easy to do, something I could do on my iphone, to support myself and I want to share this with them to help with some of their financial burdens- so I am confounded by some of their reactions

It's easy, just listen to the Options A to Z podcast. Specifically, the episode on Covered Calls. What stock you choose to apply the strategy on is up to you. There's the rub. I could tell you how I pick but that would definitely lead to a political discussion.

 

[Decrepit]

There's a lot of people who think that investing is witchcraft. It doesn't make sense to them, and they have no desire at all to understand it. When you genuinely try to help, few people want it. They see Madoff and Enron, and decide the game's fixed and just dump on it.

I have a degree in finance. I trade at home, and have a day job in the tech industry to fund my normal expenditures.

I'm in a situation right now that doesn't let me put the research time in that I want, so I'm not trading actively at the moment. After I move, I will jump back in full force.

Option trading is amazing. For people that don't get it, or are at a financial level that they can deal with it, I only teach people about protective puts. For others, there are some nice possibilities with a decent strategy.

You have to remember how many people got into trading during the tech boom. Everybody thought they'd be millionaires because the market kept going up. Then it didn't. Now there are a lot of angry people out there. Many moved their money to a pro, and now those pros have lost the money because the markets dumped so hard.

So there's a lot of resentment out there.

My goal is to get to the point that I have streams of income from multiple sources so that I can take a job just for the challenge and benefits.

I live in a place that is the polar opposite of Berkeley, and they hate finance as well. I should just be buying guns, ammo, and hoarding food according to these guys. Even though they were doing it in the 70's, the 80's, the 90's...

 

[itcheroni]

Even protective puts are difficult to explain. That podcast I mentioned is very well done. I'm currently toying with a LEAP strategy but am waiting for a pull back to try it out. I might be holding that position for over a year(which seems crazy to me for an option)!

 

[iOrlando]

reason you get looked down upon is that that type of profession is inherently risky and unconventional and many people realize your luck or skill can change in matter of seconds (risky in the sense that you can not say with certainly that you will make $X.XX this week or have $X.XX by next month). Granted options trading is a little less risky than straight up stock trading. People in generally like predictable incomes.

Personally, I would want to see how your performance is when the market is actually down. You could have bought anything this year and made money for the most part so thats not really impressive unless you outperformed drastically.

the reason not alot of people do it is they dont have alot of savings to put towards it. you cant make a living off of it if you only have $10,000 to start, unless you put it all on black and win a few times straight up.

 

[Decrepit]

LEAPS are fun.

Go look at option chains for companies like Apple out into 2011, and then show ALL of the available contracts, not just the ones near the money.

There are a lot of people betting a dollar that Apple will go to $25.00 a share or whatever. It's wild.

It's one of those things, for some people the upside on that one is good enough to have no problem with the 99% chance that you just blew $20.00 on a trade that just won't hit. Granted, the 1% chance gets you a potential 1000% return on your investment.

I hit on a contract the other day, I though that one company was undervalued for the long term, but didn't want to buy in right now. So I just bought a call for Jan2011. 4 days later, the price of the stock went up 8%, but the option doubled. Very tasty.

 

[itcheroni]

reason you get looked down upon is that that type of profession is inherently risky and unconventional and many people realize your luck or skill can change in matter of seconds (risky in the sense that you can not say with certainly that you will make $X.XX this week or have $X.XX by next month). Granted options trading is a little less risky than straight up stock trading. People in generally like predictable incomes.

Personally, I would want to see how your performance is when the market is actually down. You could have bought anything this year and made money for the most part so thats not really impressive unless you outperformed drastically.

the reason not alot of people do it is they dont have alot of savings to put towards it. you cant make a living off of it if you only have $10,000 to start, unless you put it all on black and win a few times straight up.

I have had the impression that people looked down on me but I know it's simply because they're ignorant (they are judging someone based on something they know little or nothing about). I would rather avoid such a situation but it is impossible since "what do you do" is one of the first questions people ask.

I started with 20k a year ago and I am now supporting myself. I'm not living high on the hog cause I'm a very simple guy, so 3k-4k is more than enough for me to live comfortably. I make about 3-4 trades per month and of the 50 or so option trades I've executed I have yet to lose a penny on options. And, according to my own understanding of finance and the global economy, I am being extremely safe and cautious. I make money regardless of the Dow's movement. But if I hired an assistant and paid her a regular salary, everyone would assume her job was safe and mine was risky even though both our jobs hinge on my performance. And technically options trading is often more risky than just dealing with stocks. Of course there's theoretical risk and actual risk.

I get a similar reaction when I tell people I love fighting as an art (mma, boxing, etc.). I regularly practice boxing, jiujitsu, and krav maga and, although all of it trains me to fight, I would never participate in a street fight. But from the way some people react, you would think I had blood dripping from my lips.

LEAPS are fun.

Go look at option chains for companies like Apple out into 2011, and then show ALL of the available contracts, not just the ones near the money.

There are a lot of people betting a dollar that Apple will go to $25.00 a share or whatever. It's wild.

It's one of those things, for some people the upside on that one is good enough to have no problem with the 99% chance that you just blew $20.00 on a trade that just won't hit. Granted, the 1% chance gets you a potential 1000% return on your investment.

I hit on a contract the other day, I though that one company was undervalued for the long term, but didn't want to buy in right now. So I just bought a call for Jan2011. 4 days later, the price of the stock went up 8%, but the option doubled. Very tasty.

I going to sell LEAPs that are as far into the money as possible. Ask me in a year how it works out. =)

I've never purchased an option, only sold.

 

[ucfgrad93]

I trade options as well. I make good money doing it.

 

[IntheNet]

I live in Berkeley so there aren't a lot of people interested in stocks and such and I feel as though some people here think it's even evil, which is just ludicrous to me.

Trading stock or options is an honest endeavor and I applaud your business savvy... go forth and do well for yourself.

In terms of your secondary comment - in reference to some leftists deriding capitalism and calling it unpatriotic - worry not about these low-life characters on the liberal left. This nation was founded on capitalism, business, and industrial-based economy. Many in the left are now trying to push us into foreign socialism and these anti-Americans will pass; the socialism they advertise will be ignored by our consumer-driven capitalism economy. Berkeley being a hotbed of leftist radicalism you may be better served by re-locating to New York or Chicago within the rewarding market areas.

Do well for yourself as a trader and make the nation proud! Bravo...

 

[yg17]

Trading stock or options is an honest endeavor and I applaud your business savvy... go forth and do well for yourself.

In terms of your secondary comment - in reference to some leftists deriding capitalism and calling it unpatriotic - worry not about these low-life characters on the liberal left. This nation was founded on capitalism, business, and industrial-based economy. Many in the left are now trying to push us into foreign socialism and these anti-Americans will pass; the socialism they advertise will be ignored by our consumer-driven capitalism economy. Berkeley being a hotbed of leftist radicalism you may be better served by re-locating to New York or Chicago within the rewarding market areas.

Do well for yourself as a trader and make the nation proud! Bravo...

He never even mentioned politics, so I'm clueless as to why you took the opportunity for some baseless liberal bashing.

 

[iOrlando]

3k - 4k a year? a month?

i'm assuming thats a month...

 

[chstr]

I understand it completely. Its just that it takes money to make money and as someone who grew up in a poor family it always seemed like the rich taking advantage of the poor. I appreciate the intelligence involved in capital gain but wish it was at least a little more accessible to the common folk. For instance I would have loved to invest in apple 3 years ago and if I had the money i would be very well off now. I just didn't have the money and as someone with a fair amount of grad school debt I've been advised its just not really an option for me until the debt is paid... Am I wrong?

 

[ucfgrad93]

I usually sell covered calls. I generally sell them against either AAPL or SPY.

 

[leekohler]

I have tried to tell all my friends to do this and almost all of them act like I'm trying to get them to turn tricks. In my mind I've found something incredibly easy to do, something I could do on my iphone, to support myself and I want to share this with them to help with some of their financial burdens- so I am confounded by some of their reactions

It's easy, just listen to the Options A to Z podcast. Specifically, the episode on Covered Calls. What stock you choose to apply the strategy on is up to you. There's the rub. I could tell you how I pick but that would definitely lead to a political discussion.

Hmm...I will do that. I just hope it doesn't all go right over my head.

 

[CylonGlitch]

All Traders should be Shot!

All Options Brokers or Stock Market players, well they are a different breed. I have no problem with them besides the fact that they have figured out how to make more money then I do. My stock investments have never really done well.

 

[heehee]

Even before this economy, I had trouble getting a job. But I was fortunate enough to discover options trading a year ago and have recently been able to support myself fully on it. But when I explain what I do, people generally get a strange look on their face. I'm guessing it is because 1) they think trading/investing is somehow wrong or 2) they think my position is unpatriotic (I am short the dollar and long gold) or 3) it is merely a look of confusion because they don't know what I'm talking about.

My boss is long on gold too. While not giving away too much, he founded one of the largest (top 5 by market cap) gold mining companies. Gold is money.

 

[itcheroni]

Trading stock or options is an honest endeavor and I applaud your business savvy... go forth and do well for yourself.

In terms of your secondary comment - in reference to some leftists deriding capitalism and calling it unpatriotic - worry not about these low-life characters on the liberal left. This nation was founded on capitalism, business, and industrial-based economy. Many in the left are now trying to push us into foreign socialism and these anti-Americans will pass; the socialism they advertise will be ignored by our consumer-driven capitalism economy. Berkeley being a hotbed of leftist radicalism you may be better served by re-locating to New York or Chicago within the rewarding market areas.

Do well for yourself as a trader and make the nation proud! Bravo...

Thanks for the kind words but remember we're not in PRSI! =) It is strange for me in Berkeley. I like it because I'm very socially liberal and I love tasty organic produce. I confuse people when I talk about free markets while using a bike as my sole mode of transportation. I have been thinking about moving though but I was thinking along the lines of China or Thailand. I really like NY but I would have to make a lot more than 3-4k to live there. After taxes and loan payments, I actually live on about 2k, which for my lifestyle is actually comfortable.

I understand it completely. Its just that it takes money to make money and as someone who grew up in a poor family it always seemed like the rich taking advantage of the poor. I appreciate the intelligence involved in capital gain but wish it was at least a little more accessible to the common folk. For instance I would have loved to invest in apple 3 years ago and if I had the money i would be very well off now. I just didn't have the money and as someone with a fair amount of grad school debt I've been advised its just not really an option for me until the debt is paid... Am I wrong?

I have over 100k in law school debt without a degree to show for it. I had 40k in aapl upon withdrawing from law school a year ago and I was freaking out about not being able to pay the monthly 1k+ payments. Then last fall the 40k turned to 20k. That's when I started trading options instead of investing in apple stock. I simply did the covered call strategy and reinvested the monthly revenues. I made about $250 my first month, $1000 8 months ago, $2000 four months ago, and have averaged 3-4k the last few months(don't misinterpret the data, my learning curve had something to do with the increase as well). Now I'm doing something slightly different but still with options. Of everything I've done, investing has had the least amount of barriers. It's a complete meritocracy. I had a friend start an options trading account with $500.

3k - 4k a year? a month?

i'm assuming thats a month...

Yes, per month.