The Traders Did It?

anyone who thinks they can successfully trade or who gives trading advice to others, should take a minute to consider the implications of the following news article:

http://www.forbes.com/home/wallstreet/20...

If professional traders, employed and *trained* by investment banks, end up losing lots of money - something that happens much more frequently than the "few" traders mentioned in the article - what makes you think anyone else can do any better?

I will gladly answer that.

You are talking about investments that are done on a day to day or week to week basis. Of course the risk level is the same as betting on a football game.

Most people who ask for advice on Yahoo, or atleast the ones I answer, are asking for long-term investment advice.

I do not even attempt to give people advice on investments of a short term nature. If I do, it is a CD or savings account.

However, your point is well taken. I have subscribed to some of the top Financial Newsletters for many years.

You know what I have learned?

They dont do any better with their picks than you or I. In many cases they do worse.

Unless you want people to put their money in the ground in the backyard, I think informing people that they do have long-term options like ETF's or DRIP plans is a good thing.

I think the individuals who ask the question have to look at the answers closely. First off, there are mutual fund salesmen in this forum, trying to push people to their sites. There are people who try to get others to go to their blogs.

I personally will not go to any website that is not put in the source box, otherwise I am assuming they have a motive if they put a link in the body of the message.

I am done rambling........hahahaha......

Simple. A small trader at home, can get in & out of relatively small positions (compared to Mutual Funds, Banks, Brokers, Instituitions etc.) without effecting the market. It's a totally different type of investing. Very hard, but achievable for about 5% of those that try (good trader psychology is the most important aspect of this skill).

I would really like to ask Liz, the author of the article you mention, whether she was being sarcastic. Reread it, and you might catch some sarcasm showing through?

Oh sure, all of this mortgage problem was caused by a very few, apparently inexperienced, traders? yeah... right

People could not pay mortgages, that is the bottom line... but the economy has been relatively strong, so why cant 2.2 million homeowners (well, they ~were~ homeowners) stay out of foreclosure?

A combination of the borrowers desire to overspend and buy houses that they could never truly afford, and the bank industries desire to give loans to those borrowers because that class of borrower must may crazy big fees & interest to get those ill-advised loans!

How many of ~your~ friends over the last few years have jumped into interest-only ARMS because it allowed them to buy a much more expensive home? Or refinanced all their equity to 'invest' into someone's scheme.. or worse yet, refinanced to the hilt to head to Cabo for a week...

The problem was/is caused by irresponsible borrowers, and a banking system that wanted to collect the greatest amount of fees & interest without regard to the true risk of lending more money to someone than is really appropriate.

If the author & others truly believe this whole mess was caused by a few traders acting badly.... well, would you be interested in an 18% variable rate, interest only refi for your house... it'll only cost you 6 points...

and "common sense" has a good 'pro' point for small traders, agility is a fundamental requirement for true "trading"... and a $2 billion portfolio will ~never~ be agile! :-)

I worked in fixed income(bonds) and on any given day traders would loose money,,,but at the end on the month and the end of the year, over 80% in my area were up a lot....their bonus was partially based on their profits.............I was there over ten years and every year was the same...Those who did not make money were replaced.............