8 ms·

AFAICT the article presents no evidence that it's the Day Trader Army taking the hit right now. It could be the Army sold to more serious and/or institutional

AFAICT the article presents no evidence that it's the Day Trader Army taking the hit right now. It could be the Army sold to more serious and/or institutional investors near the top who were chasing returns of their own. What's been happening for some time is a desperate search for investment returns of any kind. When treasury yields dried up in 2020-1, money piled into stocks, fueled by government transfers such as the PPP giveaway and stimmie checks. Those programs are long gone, as is a lot (most?) of the money. At some point, long term yields will stop rising, and the juicy capital gains to be had as the inevitable return to earth commences will beckon to those who have been burned by stocks to try treasuries, fueling sector rotation and more stock declines. Along the way the occasional explosive stock rally will captivate everyone's attention - for a while. By the time the dust settles, nobody will care about stocks and you'll get blank stares when you say that's what you just invested in.

ShivShankaran 4y ago
Also most of the posts on wallstreetbets have a (non)survivorship bias. I know plenty of retail traders who have 200%+ returns in last 6 months but dont post about it.
- simulate-me 4y ago
  What did they invest in?
- lexapro 4y ago
  200% of their portfolio or a small amount they gamble with?
christophilus 4y ago
I’m not in the day trader army, but I do swing trade, and have done alright on the way down— shorting / buying puts. As far as I can see, there’s no reason to think someone who did well last year trading meme stocks hasn’t made money this year shorting them. At this point, we’re oversold, and I’m mostly in cash waiting for setups to show up again.
- white_dragon88 4y ago
  Do you do well from swing trading? May I ask how much capital you work with, and what kind of gains you make?
  - christophilus 4y ago
    I did pretty well last year while being mostly in cash. I probably averaged 80% cash last year, and still ended with a 30% return or so. The thing I like about swing trading is that you take profits and sit in cash while waiting for setups. You also have limited downside, as you have clear stops that trigger if the setup fails. That said, there are many ways to trade, and some folks are more aggressive than others. I'm very conservative. I'm still not sure if I even believe in swing trading or technical analysis. I've been a Boglehead most of my adult life, and only recently decided to dabble with swing trading, just to learn / see if there was anything to it. So far this year, I'm flat, but I've also been less active due to a few life situations. I'd like to do a statistical analysis once I've been at it long enough.
simulate-me 4y ago
There is still 1.8T sitting in banks (based on reverse repo rate) with absolutely no purpose. It will be interesting to see what happens to this money.
- yardstick 4y ago
  1.8T with a population of 329.5m is about $5,462 per person in the US. Even if you halve the number of people, ~$11k per person seems like a low number - I’m probably not understanding the numbers correctly? You do need some cash for a rainy day, emergency expenses, unexpected travel etc.
  - quasifinite 4y ago
    Yes, you ought to be able to afford to cover small emergencies. But unfortunately it seems that many Americans cannot. For instance, "Survey finds more than half of Americans can’t afford a $1,000 emergency", https://thehill.com/changing-america/respect/poverty/590453-survey-finds-over-half-of-americans-cant-afford-a-1000/ https://thehill.com/changing-america/respect/poverty/590453-...

ShivShankaran 4y ago

Also most of the posts on wallstreetbets have a (non)survivorship bias. I know plenty of retail traders who have 200%+ returns in last 6 months but dont post about it.

simulate-me 4y ago
What did they invest in?
lexapro 4y ago
200% of their portfolio or a small amount they gamble with?

christophilus 4y ago

I’m not in the day trader army, but I do swing trade, and have done alright on the way down— shorting / buying puts. As far as I can see, there’s no reason to think someone who did well last year trading meme stocks hasn’t made money this year shorting them. At this point, we’re oversold, and I’m mostly in cash waiting for setups to show up again.

white_dragon88 4y ago
Do you do well from swing trading? May I ask how much capital you work with, and what kind of gains you make?
- christophilus 4y ago
  I did pretty well last year while being mostly in cash. I probably averaged 80% cash last year, and still ended with a 30% return or so. The thing I like about swing trading is that you take profits and sit in cash while waiting for setups. You also have limited downside, as you have clear stops that trigger if the setup fails. That said, there are many ways to trade, and some folks are more aggressive than others. I'm very conservative. I'm still not sure if I even believe in swing trading or technical analysis. I've been a Boglehead most of my adult life, and only recently decided to dabble with swing trading, just to learn / see if there was anything to it. So far this year, I'm flat, but I've also been less active due to a few life situations. I'd like to do a statistical analysis once I've been at it long enough.

simulate-me 4y ago

There is still 1.8T sitting in banks (based on reverse repo rate) with absolutely no purpose. It will be interesting to see what happens to this money.

yardstick 4y ago
1.8T with a population of 329.5m is about $5,462 per person in the US. Even if you halve the number of people, ~$11k per person seems like a low number - I’m probably not understanding the numbers correctly? You do need some cash for a rainy day, emergency expenses, unexpected travel etc.
- quasifinite 4y ago
  Yes, you ought to be able to afford to cover small emergencies. But unfortunately it seems that many Americans cannot. For instance, "Survey finds more than half of Americans can’t afford a $1,000 emergency", https://thehill.com/changing-america/respect/poverty/590453-survey-finds-over-half-of-americans-cant-afford-a-1000/ https://thehill.com/changing-america/respect/poverty/590453-...