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Option trading?

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Hi Harley,

No, I'm not really a daytrader (anymore), but in troubled waters like we're
sailing now, I just don't like the downside risk of long positions (which I
personally prefer, sleep-wise, to short).

In high volatility like this, just the normal trading range can cause me to
get stopped out, but sometimes it's not just volatility. I was sitting here
watching the breathtaking strength of the oil drillers a few weeks ago, and
in the time it took me to take a shower and get the paper, SLB dropped a
couple of points.......Since I had nothing but drillers in my portfolio at
that time, (and since the rest of the market was dropping anyway) I sold
first and asked questions later.

That turned out to be about 30% ago.

But this is why I only trade while I'm not needed at the shop these
days.........If you're not watching real-time, you have to loosen your stops
in a volatile market (to prevent whipsaw and premature sells due solely to
"market noise"). This can lead to big losses.

And if you CAN watch the intraday market, you should keep or tighten your
stops to keep profits from turning into losses.

But the worst thing you can do (in my opinion) is have real time and take a
big loss while you watch it drop......this sets you up psychologically to
dread trading, and guarantees you'll try to "wait till it's safe" which will
put you into trades exactly at the top, and get you out exactly at the
bottoms. Infuriatingly, the T/A you select will wind up supporting the fear
you feel.

I know I'm not telling you anything you don't already know, but you might
want to consider not using real-time for the kind of trading you're
doing.... It's too easy to overtrade and lose money, or undertrade and lose
confidence, unless you're willing to set tight stops, take smaller profits
quickly, and cut losses even quicker.

Eventually, you'll probably come to the same conclusion that I
have......It's better not to use these darn internet-based "real-time" quote
services for trading.

BTW, did you ever see the Robert Redford/Paul Newman movie, "The
Sting"?.....you know, where they got the horse race results, but delayed
them slightly to "front-run" the betting ? I just wonder how long it'll be,
before this age-old scam is perpetrated on the thousands and thousands of
new home-based "high tech" private investors like us.

My opinion ? It's already started with our mandatory signed approval not to
hold companies like PC Quote responsible for accuracy and timeliness of
And subsequently recieving exactly what we signed for.


-----Original Message-----
From: Harley Meyer <meyer@xxxxxxxxxxx>
To: Dick <dick@xxxxxxxxxxxxx>
Cc: metastock-list@xxxxxxxxxxxxx <metastock-list@xxxxxxxxxxxxx>
Date: Saturday, December 27, 1997 12:58 PM
Subject: Re: PCQuote

>Hello Dick,
>I'll try this again. After being almost done the computer crashed. Oh
>With out making any assumptions, I am reading that your style of trading
>is day trading. You are looking for some piece of information that is
>going to move the market and you want to be on board when it starts and
>out when the market/stock begins to lose the upward momentum. You are
>looking for that 1 to 2 point scalp.
>I can now see why PCQuote is not for you and I want to thank you for
>taking the time to letting us know why PCQuote is slow for you. Beings
>that I have the same PCQuote although a different service I will agree
>with you that PCQuote can't do what you wants it to do.
>To answer your question about selling or holding. I would wait until the
>price moved 2 points below where I bought in at and then see if I could
>get out of the mess without losing any money. LOL, of course. I would
>I will add though that I am surprised that the quotes are that far
>behind on any given stock that you can't trade it. Now I don't follow
>the most active stocks everyday to compare how PCQuote performs with
>these. So I don't know if these stocks have problems with the data
>getting back logged or not. As we both know happens on the "busy" days.
>I am still with YHOO and I am able to trade off the prices that come in
>to PCQuote. But with out beating a dead horse I can understand the
>uncertainty that you might have because the other information you need
>is not timely.
>One thing that I had mentioned earlier was to create two ticker window.
>One for just the trades and the other for the market makers. Even though
>I constantly watch the charts to see where the price is going, I will
>say that ticker window really gives a great deal of information because
>you can watch the market facilitation. This can be some of the last
>piece of info I will look at when I place a day trade. Of course looking
>at where I am in the daily range helps too.
>I'll send you a copy of my PCQuote for windows page so you can see what
>settings I use for the tickers. You can also see what I mean by almost
>level II for free.
>Now that I understand your style of trading, let us know what you
>eventually settle into for future references.