I see non-quant trading methods regularly bashed here, so was wondering if there's any short term traders (< week) on HN?
As this is an eng-heavy crowd would be interesting to hear you story and what kind of analysis you do (not expecting too much detail of course!).
I use a hybrid complex event processing system that is mostly custom built, as well as a large scale data ingestion framework that takes in around 2-3GB of price data and other relevant information every day. It took a really long time to get this part of my setup working because without a decent way to kick off a process that subscribes to this data easily, everything else is going to be a huge pain in the ass.
I put on trades on a 2week-1 month time frame, and aggressively sell winners and use stop losses to get rid of shitty positions. I use GARCH, ARIMA models, and have recently been playing around with some more exotic ML techniques, but I've found that momentum trades work the most reliably.
I'm working on a SaaS API to try and make some money off of my data collection systems, but that's still in the works.
EDIT: I try to identify interesting individual options that are, according to my model "mispriced" given a few signals. I seek out multibagger options. Most recently, I purchased the $PLTR 11/27 $22 strike calls two days ago, and made a killing (was around a 6x gain). If you are methodical in your data collection processing, there's a lot of valuable information that can be obtained. It just requires lots of data munging (which, honestly, is so painful all things considered). But turning 1k into 10k is a wonderful experience, especially if you can reproduce it.
I have taken the well known 30-40 advanced options strategies and created a dynamic programming algo to basically run through every single listed security and every reasonable combination of options that would yield these strategies, with some filtering to make it computationally tractable, and then computed what the collateral costs would be (for spread trades, for ex.). That creates a reasonable doable list, and then I run a straightforward backtest. From here, I either pursue a trade or not. I like the idea of fully automating this stuff but its just not there yet. In any case, systematizing a lot of the boring crap is a great way to more deeply understand the landscape. You're never going to compete with execution-based firms but you can definitely take a view based on underlying fundamentals/macro landscape and then tune a slightly longer based system appropriately.
At the risk of a naive question, may I ask where you get your option feeds from?
I've been hesitant to pull the trigger on any of the "professional quality" feeds given that I've been treating this sort of thing largely as a hobby, but the less pricy options seem highly variable in data quality, granularity and availability. I guess if you're trading on week/month timescale this may not be necessary, thus my musing.
Thanks for sharing, sorry if this is probing more deeply than you'd be willing to broach.
I source option data from a combination of some paid APIs, some free sources. You can find a lot of data sitting around the internet if you're careful about it and respect robots.txt... Some people even pay for XIgnite and other crazy expensive data sources, but then have not secured their own endpoints (some SaaS operators have done this) so I scoop that data up too.
but as @marketgod suggests, you can definitely just use broker APIs, thats going to be the best bet for the most part and if you're price sensitive.
Get a ThinkOrSwim account with $10 in it and you get their real time API. You can create a socket and store the entire chain. Perfect data does not exist in this world, anyone who claims they have it, has a lot of money.
Taking a stab in the dark here but let me know if I am close. You are using GARCH and ARIMA on the options pricing data to identify moves in the market. Once you identify a move you try out a bunch of different combinations of buying/selling puts/calls. You then take a look at the possible positions and see which wouldn't require an absurd collateral and execute on it?
For something like PLNT how did you run a backtest? It seems like there is only ~1 month worth of data.
They shouldn't be much different from other engineering jobs. One thing they will look for is "business acumen". Learn all the finance buzz words, pay attention to the market, and credentialize. Finance people seem to love prestige and credentials (just my experiences). A degree which includes finance is good. You can also get a CFA foundations certs. A CFA charter would get you real respect, but I think they have experience requirements for that.
Yup, use a few different APIs to paint a picture going back around 20 yrs, including fundamentals, filings, ex-div dates, splits, reverse splits. Currently focused on US equities exclusively, and the foreign companies that have secondary listings on US exchanges. Definitely keeping me busy, just with those ~7668 tickers.
Hi, thanks for asking - I'm definitely open to that in the near to mid-term. I'm currently working to scale the systems and also expose my robust APIs online as a SaaS, but I'm interested to hear what you're thinking.
Feel free to reach out to me at the email listed on my profile!
My (personal only) side project trades weekly, and takes several positions. I never hold a position for more than a week, and occasionally trade the same position several times within a one-day period. I'm on version 5 of my robot, and have recently been thinking of turning the data it gathers into a service to make it easy for other developers to get real-world data at a reasonable price.
I use my data to search for inefficiencies (however small) that exist in the market. I then arbitrage these efficiencies on a weekly basis. I do this across stocks, options, and futures (not Forex). To be clear my goal is not to find "stocks that will pop", or "stocks that will plummet", rather I purely exploit micro-inefficiencies that exist in the
market, which means this cannot work at scale.
From your description, the term you are looking for is swing traders.
Yes, I swing trade options. All technical analysis.
Only stocks. Pure technical analysis. Main items we focus on are price-action and price-volume. In essence, for every minute the price goes up, what's the volume? For every penny the stock goes up, what's the volume? For every 100,000 shares what's the change in price?200k? 300k? 1m? and so on. Also, weighted factors for all the different indicators, MA/SMA/CCI/RSI/VWAP being of most pertinence. Pitch fork trends weighted at a lower level. Also several other proprietary indicators based on stock correlation (i.e. BABA vs AMZN, if AMZN is moving down, BABA should as well because of what it relies on).
I have been getting killed the last month but still up over 100%. Just hit on GS (100%+), and likely will on TSLA. Also did 1500% on TSLA this year on a trade which was my biggest so that helps.
TSLA seems ready for a similar move to when I made my last huge run.
I think there is less risk. Especially with my strategy. Also you get 100x leverage. So I will give you a sample trade from today.
I bought Dec04 $600 Calls for $900 each at 9:55 am. At 1:25 I sold for $1820. So $1000 would be $2000. Now to make $1,000 in shares it would require ($1000/($25)) so I would need 40 shares (40*$550) = $22,000 risk.
Now I only buy calls or puts so my upside is always unlimited but downside is limited to the initial order.
Swing trading stocks is really hard because you have to sleep on $22,000 overnight. You can wake up with nothing in a black swan event. With options the most I will get hit on is $50-$100,000 which I have in the market at once. The rest is ready in the savings account in cash or etfs/TSLA stock.
I think options are the safest bet. Everyone starting out should look into the wheel strategy as it's basically free money for shareholders.
It is but not that much. It's limited to how far the stock falls. So if you buy a $500 contract when the share price is $95 you can still make $9500. If you had sold puts/calls then your profit is limited to the first sale you made.
I'm not an expert on astrology, but I see many cultures believe in it. Maybe there is a method to their madness that we don't understand now that you mention it.
I know for TA, you have to look at the patterns and they are visible in the data. The people who are against are the ones who can't figure it out.
I day traded options for a little while but now trade longer term options. I don’t run any complex strategies, partly so I can spend my time on identifying winners instead. Just buying calls or puts, sometimes spreads. I don’t have a way to automate that, it’s just reading a lot and trying to formulate and rank possibilities
It’s my first year and I’m only at a 10% return in my fun money portfolio (vs 50% on just buy and hold QQQ) despite a few multi baggers because of not cutting losses earlier. Hoping to do better this year and add some basic stop losses at least.
I may add more automation and start building my own tools now ,this past year I focused on trading manually so I know what would be useful to build in the first place. I’m building a basic Jupyter notebook to analyze previous trades and explore the API.
I watch the options volume. Once I saw a majorly abnormal spike in Call volumes. It happened minutes right before a major Fed announcement or something. The market rallied, and continued to rally.
It seems, someone got a leak of the Fed notes, and went long on Calls.
She will perpetuate the inequality in America. The rich will keep getting richer. The line between the haves and the have nots, will continue to divide us.
It’s easy for the Fed to drop the interest rate. It’s just the stroke of a pen for them. And it’s not their money, since they’re just printing it.
It’s harder to put concrete action into policy that will help Americans and ensure equality and fairness for all, instead of for just the privileged few.
The last time she was the Fed Chairman, she lowered the interest rates and injected QE into the system, which benefited only the large corporations that really didn’t need the help. But it devastated everyone else that could have used the help.
And again, without fixing the systemic issues, they will repeat the 2000 dot-com implosion, and the 2008 housing crisis again.
I put on trades on a 2week-1 month time frame, and aggressively sell winners and use stop losses to get rid of shitty positions. I use GARCH, ARIMA models, and have recently been playing around with some more exotic ML techniques, but I've found that momentum trades work the most reliably.
I'm working on a SaaS API to try and make some money off of my data collection systems, but that's still in the works.
EDIT: I try to identify interesting individual options that are, according to my model "mispriced" given a few signals. I seek out multibagger options. Most recently, I purchased the $PLTR 11/27 $22 strike calls two days ago, and made a killing (was around a 6x gain). If you are methodical in your data collection processing, there's a lot of valuable information that can be obtained. It just requires lots of data munging (which, honestly, is so painful all things considered). But turning 1k into 10k is a wonderful experience, especially if you can reproduce it.
I have taken the well known 30-40 advanced options strategies and created a dynamic programming algo to basically run through every single listed security and every reasonable combination of options that would yield these strategies, with some filtering to make it computationally tractable, and then computed what the collateral costs would be (for spread trades, for ex.). That creates a reasonable doable list, and then I run a straightforward backtest. From here, I either pursue a trade or not. I like the idea of fully automating this stuff but its just not there yet. In any case, systematizing a lot of the boring crap is a great way to more deeply understand the landscape. You're never going to compete with execution-based firms but you can definitely take a view based on underlying fundamentals/macro landscape and then tune a slightly longer based system appropriately.
I've been hesitant to pull the trigger on any of the "professional quality" feeds given that I've been treating this sort of thing largely as a hobby, but the less pricy options seem highly variable in data quality, granularity and availability. I guess if you're trading on week/month timescale this may not be necessary, thus my musing.
Thanks for sharing, sorry if this is probing more deeply than you'd be willing to broach.
but as @marketgod suggests, you can definitely just use broker APIs, thats going to be the best bet for the most part and if you're price sensitive.
For something like PLNT how did you run a backtest? It seems like there is only ~1 month worth of data.
Feel free to reach out to me at the email listed on my profile!
I use my data to search for inefficiencies (however small) that exist in the market. I then arbitrage these efficiencies on a weekly basis. I do this across stocks, options, and futures (not Forex). To be clear my goal is not to find "stocks that will pop", or "stocks that will plummet", rather I purely exploit micro-inefficiencies that exist in the market, which means this cannot work at scale.
Yes, I swing trade options. All technical analysis.
Only stocks. Pure technical analysis. Main items we focus on are price-action and price-volume. In essence, for every minute the price goes up, what's the volume? For every penny the stock goes up, what's the volume? For every 100,000 shares what's the change in price?200k? 300k? 1m? and so on. Also, weighted factors for all the different indicators, MA/SMA/CCI/RSI/VWAP being of most pertinence. Pitch fork trends weighted at a lower level. Also several other proprietary indicators based on stock correlation (i.e. BABA vs AMZN, if AMZN is moving down, BABA should as well because of what it relies on).
I have been getting killed the last month but still up over 100%. Just hit on GS (100%+), and likely will on TSLA. Also did 1500% on TSLA this year on a trade which was my biggest so that helps.
TSLA seems ready for a similar move to when I made my last huge run.
I understand the upside can be greater, but so is the risk. Is there something I’m missing?
Is there a risk level beyond which options make more sense?
I bought Dec04 $600 Calls for $900 each at 9:55 am. At 1:25 I sold for $1820. So $1000 would be $2000. Now to make $1,000 in shares it would require ($1000/($25)) so I would need 40 shares (40*$550) = $22,000 risk.
Now I only buy calls or puts so my upside is always unlimited but downside is limited to the initial order.
Swing trading stocks is really hard because you have to sleep on $22,000 overnight. You can wake up with nothing in a black swan event. With options the most I will get hit on is $50-$100,000 which I have in the market at once. The rest is ready in the savings account in cash or etfs/TSLA stock.
I think options are the safest bet. Everyone starting out should look into the wheel strategy as it's basically free money for shareholders.
I have some LEAPS on AAPL as a test but really it's because I didn't want to hold shares any longer and it was a good bet as AAPL pulled back hard.
I know for TA, you have to look at the patterns and they are visible in the data. The people who are against are the ones who can't figure it out.
It’s my first year and I’m only at a 10% return in my fun money portfolio (vs 50% on just buy and hold QQQ) despite a few multi baggers because of not cutting losses earlier. Hoping to do better this year and add some basic stop losses at least.
I may add more automation and start building my own tools now ,this past year I focused on trading manually so I know what would be useful to build in the first place. I’m building a basic Jupyter notebook to analyze previous trades and explore the API.
Would you publicly post price predictions/odds to get ranked alongside other traders via Brier scores?
It seems, someone got a leak of the Fed notes, and went long on Calls.
And the next Treasury Secretary is.. Janet Yellen.
A massive increase in asset prices in stocks and housing.
QE Infinity is here to stay. Low interest rates are going to screw up everything.
Go long in stocks. They’re going to save the market.
It’s easy for the Fed to drop the interest rate. It’s just the stroke of a pen for them. And it’s not their money, since they’re just printing it.
It’s harder to put concrete action into policy that will help Americans and ensure equality and fairness for all, instead of for just the privileged few.
The last time she was the Fed Chairman, she lowered the interest rates and injected QE into the system, which benefited only the large corporations that really didn’t need the help. But it devastated everyone else that could have used the help.
And again, without fixing the systemic issues, they will repeat the 2000 dot-com implosion, and the 2008 housing crisis again.
Myself, I'm just a algotrader focusing on short term trades in the crypto and equities(microcaps) markets. Tech stack is EC2/screen/pypy(python).
Now, to be clear, I am not one myself, but the answer is still yes.