Got a simple question about trading personal accounts.
I've been messing around on a paper trading account to get some exposuring to investing/trading equities and have made some pretty decent gains making really obvious trades (meaning: reading the news and making the corresponding trade). So I'm assuming, besides the obvious pressure of dealing with real money, that it isn't that easy on an live account.
Can anyone provide insight into the differences that I am not aware of? I'm guessing neither that RIMM short nor that Pandora short order were as easily filled as they appeared on the paper account.
Not really sure what you're aware of or not, but...For shorts you have to take into account being able to borrow along with the cost of borrowing. You also have to factor in your actual execution vs the number you theoretically decide you will sell/buy at. There are also transaction costs to factor in. People also tend to develop an emotional attachment with their trades and have a harder time hanging onto "losers" in the belief that it will recover or perform better, and selling winners too fast or getting greedy and not selling when it would normally be advisable to do so.
liquidity issues depending o nthe size of your trade, super thick or relatively thick stocks wont have much of an issue with this esp in regards to paper trading but once you have real size .. real money also presents other psychological factors into it
Thank you for the insight guys.
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