4 ms·
Simply put, day means if you bought on the market open and sold at the close. Night means if you bought on the close and sold on the open. The implication seem
by dkrich 4y ago
Simply put, day means if you bought on the market open and sold at the close. Night means if you bought on the close and sold on the open.
The implication seems to be stocks jump at the open then trail off during the day. Thing is most of this is only obvious in retrospect and by the time you realize it the opportunity is gone because it’s now widely known.
- 4ggr0 4y agoAs someone who doesn't know much about stocks and trading - is it normal to keep stocks for only <12h? All comments talk about morning -> evening or evening -> morning, what about morning -> morning, or even longer timespans? Or is this the difference between trading and investing?
- ale42 4y agoYou can keep stocks only for milliseconds if you wish... (see e.g. https://en.wikipedia.org/wiki/High-frequency_trading https://en.wikipedia.org/wiki/High-frequency_trading). And for the less extreme version there's day trading (https://en.wikipedia.org/wiki/Day_trading https://en.wikipedia.org/wiki/Day_trading) where you sell all your positions before the market closes (basically you try to speculate on intra-day changes of the stocks, so you keep them from minutes to hours). > Or is this the difference between trading and investing? Probably, or rather between purely speculating and investing?
- twic 4y agoI don't think trading is the same as speculating. To me, speculating is making big directional bets, eg "I think oil is underpriced right now, so i am going to buy loads of oil futures, then hope that in three months i can sell them at a much higher price". Whereas trading is usually much shorter-term and less directional, eg "I think French government bonds are overpriced relative to German government bonds right now, so i am going to get short French bond futures, buy an equivalent amount of German cash bonds, then hope that in a couple of days i can unwind that for a profit". And investing is "people like to drink Coca-Cola, so i will buy shares in the Coca-Cola company". But i don't think there are hard and fast definitions.
- Joker_vD 4y agoYeah, some people use "trading" and "speculating" in the exactly opposite way than you do. Some equate speculating and trading entirely: a trader is someone who buys something not for personal use but for further resale, and of course they hope to sell at a higher price, duh.
- dkrich 4y agoNo, it’s definitely not normal although I don’t have figures on what the average hold time is for any given issue. Since a lot of stock is purchased as automatic 401k contributions a lot of stock is held for many years. I believe this article is just using this to illustrate an unusual price pattern that emerged for some time where stocks opened higher than the close for a significant number of days over this timeframe.
- joncrocks 4y agoI believe when people talk about trading and investing the main difference is the time horizon. See Swing Trading, Day Trading etc. for shorter-term time-horizons. Keeping stocks only intra-day would be Day Trading (generally). There are lots of people on the internet who say they can 'teach' you day-trading. Don't do it unless you have a very high risk tolerance, i.e. are willing to lose it all and walk away. Even then there's probably better things to do with your money.
- 4ggr0 4y ago> There are lots of people on the internet who say they can 'teach' you day-trading. Don't do it unless you have a very high risk tolerance, Yeah I know, watched a ton of videos documenting the shady things these finance-gurus have done over the years. For a couple of months I was involved in a signal-trading group (I knew them personally), but I never had a good feeling about it and pulled my money without loosing much of it. After playing around with crypto I've come to the conclusion that a savings and retirements account is probably the better solution for me, even though the interest is laughable. At least the money is safe as long as the global financial system doesn't totally collapse. In the end I don't care enough about having more money to venture into investing etc., and I'm too scared of being conned by someone.
- brmgb 4y agoIt’s just parasitism on top of the legitimate activities of the market (capital allocation). People who benefit from it (market administrators, traders) like to pretend it increases the liquidity of the market and that it’s a good thing. How you appreciate this argument generally directly depends of how much you stand to gain from it being accepted.
- astrange 4y agoHFT/market making is good for retail investors. Otherwise you'd have a lot more trouble and higher fees investing eg $100 at a time.
- brmgb 4y agoYeah, yeah, I know the drill lower fees, faster price discovery, better liquidity. You will have a hard time convincing me any of these benefits are worth tolerating the damage speculations wreak like clockwork every ten years or so but I know I am on the losing side of this battle.
- astrange 4y agoMarket makers aren't speculators. It's like the opposite.
- brmgb 4y agoMarket makers very much are speculators. They intend to make money on the spread. They clearly are not investors.
- astrange 4y agoWhat belief are they speculating on? As for if they're hurting markets, that seems like banning grocery stores and expecting people to buy food from cereal manufacturers.