Swing trading ETF's with a brokerage account.

[Show-me]

Swing trading ETF's with a brokerage account. It is becoming more popular and here is what I shared with another member.

This is how I do it. Stick to one thing and only one thing. Use only Index ETF's, no individual stocks. The Indies ETF's are diversified for you.

SPY is Long S&P 500
SH is Short S&P 500

SSO is 2X Long S&P 500
SDS is 2X Short S&P 500

Here is the link for PowerShares ETF's.

http://www.proshares.com/funds?products=98616&fundType=

There are a ton of other markets you can long and short. I stick to ONE so I do not get overwhelmed.

There is one long ETF for S fund and no short that I know of, VXF = S fund.

I fund is here. http://www.proshares.com/funds?produ...=International (http://www.proshares.com/funds?products=&fundType=International)

F fund or bond is AGG and I do not even mess with that one. To much money to be made in SSO and SDS.

I play all or nothing. I pick a good entry point and shoot for 3% to 5% for a sale. Have a STOP in your mind once you get your buy. Then have a limit sell in mind.

Once I get my buy order filled I set my STOP 5% below that price. I deal with 2X leveraged so a 2.5% market move will equate to 5% on the leveraged ETF's.

Once I am comfortable my STOP will not get hit I will cancel and switch to a LIMIT SELL order.

[Show-me]

Roth IRA's are great.

Use who ever you feel good with ETrade, Scottrade, TD, etc. I use Scottrade because Spaf recommended it to me.

Understand Roth rules first, here. http://www.fairmark.com/rothira/roth101.htm

There are income limits.

Paper trade like 350Z suggested using this. https://www.thinkorswim.com/tos/displayPage.tos;jsessionid=AB5E3E14272649C2A0C1253 0D0C1D21F.tos2_w1c1?webpage=paperMoney

Use only a broad index etf and start slow. I use one and only one market, the S&P. There are others out there and I know them but I know the S&P the best and I don't have to keep track of to many things at one time.

I have a small account so I trade all or nothing to cut down how much the buy and sell fees eats into my trades.

Use limit orders ALWAYS! Use stops in case you get killed on the drive to work and your trade goes to crap. This does nothing for you, cuz your dead, but protects your families inheritance so they can bury you in a nice box.

[airlift]

Show,
I learned you had opened this thread today. It is a very good idea to open this thread. People that might choose to short also can discuss and learn the more specialized and complex requirements of trading. I have to get in a learning mode big time! Good Luck and have a great day.

[Show-me]

You guys that are starting out, go slow. Use these first to get a feel that way you don't get beat to bad if it don't work out.

SPY is Long S&P 500 or same thing as the C fund.
SH is Short S&P 500

[Intrepid_Timer]

Please be advised that it takes three days for funds to "settle" once you sell them so you can't "actually" trade daily like we use to with our TSP. But the alternative is much better. :D

[Show-me]

Unsettled Funds - Trading in Cash Accounts

Interpretations of Regulation T, which govern how trades are paid for, state that funds from liquidations in cash accounts will not be available to pay for purchases until the settlement date of the sell.

Credit balances in a cash account may be used for purchases.

If the account has settled funds, there are no restrictions as to what may be purchased.
If the credit balance is a result of an unsettled sale of securities, certain restrictions may apply.
Unsettled proceeds from existing long positions can be used to purchase additional securities as long as the new purchase is not sold prior to the settlement date of the original sale that generated the proceeds used to finance the purchase.
If it is sold prior to the settlement date of the funding sale without additional funds being deposited, it will be considered a free ride under Federal Reserve Regulation T.
For example, if you sell a security on Monday the 1st, you can use the proceeds to make a purchase prior to the settlement date of Thursday the 4th. However, if you make a purchase before Thursday the 4th then sell that new position before the settlement of Monday's sale, you will then be required to deposit funds to pay for the purchase. If you purchase on Thursday the 4th, you may place a sell at anytime you wish, since the purchase was made with settled funds.

Mutual Funds and Fixed Income Securities can only be purchased with existing or settled funds.

[Show-me]

Here is the deal. Even in TSP it take 3 days to "settle" a stock buy or sell. That is one of the reasons they are pitch'n a bitch.

In your private account you will see that your funds will be waiting for settlement after you make a buy. It will be three days to settle. You can sell while you wait for the buy settlement to laps but you will not be able to re-buy anything until the new sell settles for three days.

[FUTURESTRADER]

Show, doesn't the wash rule apply to ETFs?

[Show-me]

Show, doesn't the wash rule apply to ETFs?

I don't know what the wash rule is. :embarrest: I get the settlement of funds prompt when I try to make a trade inside the 3 day period in and out.

[FUTURESTRADER]

I don't know what the wash rule is. :embarrest: I get the settlement of funds prompt when I try to make a trade inside the 3 day period in and out.

it's for tax loss purposes, 30 days

"In general you have a wash sale if you sell stock at a loss, and buy substantially identical securities within 30 days before or after the sale.

Example: On March 31 you sell 100 shares of XYZ at a loss. On April 10 you buy 100 shares of XYZ. The sale on March 31 is a wash sale.

The wash sale period for any sale at a loss consists of 61 days: the day of the sale, the 30 days before the sale and the 30 days after the sale. (These are calendar days, not trading days. Count carefully!) If you want to claim your loss as a deduction, you need to avoid purchasing the same stock during the wash sale period. For a sale on March 31, the wash sale period includes all of March and April."

[weatherweenie]

Show, doesn't the wash rule apply to ETFs?

Does the Wash rule apply in Roths?

[offtrack]

Does the Wash rule apply in Roths?


No wash rule in Roth or regular IRAs. Roths are funded with after tax income. You pay no taxes on future gains hence no need for wash. Regular IRAs are taxed at ordinary income rates so again no capital gain to wash. There was and still maybe a loophole where you could sell stock not held in your IRA for the loss and immediately buy it back again in the IRA thus creating two separate transactions for IRS purposes. I don't know if this still exists since I no longer trade in any account other than my Roth.

On a sidenote foreign tax exclusion can't be claimed for a ROTH either to my knowledge.

[Show-me]

Ok, I did know about that but forgot and most of my focus has been on IRA accounts only.

Very good point to bring up to avoid tax.

[lindalyc]

It's great that you opened this thread. we sure will learn a lot.
Where to look for long or short signals? I remember you said somewhere that you follow Robo's? I could not find it.

Thanks

[Show-me]

In the Long Run, We're All Dead

Posted Mar 26, 2008 12:22pm EDT by Aaron Task (http://finance.yahoo.com/tech-ticker/author/Aaron-Task) in Investing (http://finance.yahoo.com/tech-ticker/Investing) Related: ^SPX (http://finance.yahoo.com/q?s=%5ESPX), ^DJI (http://finance.yahoo.com/q?s=%5EDJI), SPY (http://finance.yahoo.com/q?s=SPY), TLT (http://finance.yahoo.com/q?s=TLT)

When the market is as wild as it's been of late, it's easy to get sucked into the daily drama (http://biz.yahoo.com/ap/080326/wall_street.html). But it's always important to keep the long-term view (http://stockcharts.com/charts/historical/) in focus.
And the long-term reality is this: The U.S. stock market has been essentially flat (http://finance.yahoo.com/q/bc?s=%5EGSPC&t=my&l=on&z=m&q=l&c=) for the past nine years and has wildly underperformed other assets, including Treasuries, as detailed by The Wall Street Journal (http://online.wsj.com/article/SB120649226977964203.html?mod=hps_us_whats_news).
Key takeaways from this grisly track record:

Owning stocks, even for a long period, is not a guarantee of success (http://www.jeremysiegel.com/) as many came to believe in the 1990s. There also the debate over buy and hold vs. market timing to consider.
Having a diversified portfolio (https://www.fairfieldnationalbank.com/investments/WealthManagement/GrowingYourWealth/ReducingRisk.asp) of assets -- not just diversity among your equity portfolio -- is critical to long-term investing success, if not survival.
The current morass does help set up the next bull market cycle, and U.S. stocks are cheap (http://online.wsj.com/article/SB120649469119164359.html?mod=hps_us_whats_news) relative to Treasuries, real estate, and international markets. That may help in the short term, but the stock market has a history of moving in 17-year cycles (http://www.zealllc.com/2005/longwave2.htm), which means we may be only about halfway through the current long-term slump.

[RPM]

Roth IRA's are great.

Use limit orders ALWAYS! Use stops in case you get killed on the drive to work and your trade goes to crap. This does nothing for you, cuz your dead, but protects your families inheritance so they can bury you in a nice box.

What would you set as a limit sell order? Still at 5%?

TIA

[RPM]

List of all (??) ETFs.
http://www.etfconnect.com/select/FindAFund.aspx


Show-me, any thoughts on those ETF with really high yield? (>5%)?

Thanks,

[Show-me]

List of all (??) ETFs.
http://www.etfconnect.com/select/FindAFund.aspx


Show-me, any thoughts on those ETF with really high yield? (>5%)?

Thanks,

Not really, I stick to my core etf's. SDS and SSO. I use a very loose stop range between 5% and 10%.

[Aggie76]

Quotes for Long 1x 2x, Short 1x 2x for NASDAQ, S&P500, MID CAP 400, and DOW:

http://finance.yahoo.com/q/cq?d=v1&s=qqqq,qld,psq,qid,spy,sso,sh,sds,mdy,mvv,myy,mzz, dia,ddm,dog,dxd

[craigerv]

It's been a while since this thread has grown and I am looking to start trading ETFs sometime in the next 2 years (I want to kick the student loans first). First of all, what are your recommendations for a brokerage? I've looked up TD Ameritrade, they seem to offer many free ETFs. My main question is about the fees for not holding the ETF for long enough. I have been coming up with a few systems that trade around 2-3 times per month just based on TSP rules. But I notice with ETFs there is a fee for not holding longer than say 30 days or so. I think it was something on the order of $20 or something. My question, is do you just swing trade and take the fee since it's probably less than any gains you would make on your trade? Or do you use a longer term approach and look for better buying opportunities? I've been trying to get a better handle on longer term trading but I don't think I've formulated a great exit strategy to avoid the slumps.

- Also, I'm not talking about trading in a Roth IRA account, this account would be just my own personal investments

[Kaufmanrider]

Are you mistakenly comparing Mutual Funds with ETF's? I manage two ROTHS and a personal brokerage account with Charles Schwab. I can trade any of the Schwab ETF's commission free (or Schwab Mutual Funds). I don't use the Mutual Funds, only ETF's. Examples are SCHA (Small Cap), SCHE (Emerging Market, SCHF (Foreign like our I Fund), SCHZ (AGG Bonds-F Fund, there are many others.

Three day hold for funds to settle if ETF's/Stocks purchased with unsettled funds. If purchased with settled funds, no hold. If I trade other ETF's, Mutual Funds, Stocks, that are not part of the Schwab funds, I pay 8.95 commission per trade.

If you trade 3 times a month, 36 a year in your account, Schwab will give you StreetSmartEdge to use. It's their proprietary program for rechnical analysis, managing your account, buying/selling, etc.





It's been a while since this thread has grown and I am looking to start trading ETFs sometime in the next 2 years (I want to kick the student loans first). First of all, what are your recommendations for a brokerage? I've looked up TD Ameritrade, they seem to offer many free ETFs. My main question is about the fees for not holding the ETF for long enough. I have been coming up with a few systems that trade around 2-3 times per month just based on TSP rules. But I notice with ETFs there is a fee for not holding longer than say 30 days or so. I think it was something on the order of $20 or something. My question, is do you just swing trade and take the fee since it's probably less than any gains you would make on your trade? Or do you use a longer term approach and look for better buying opportunities? I've been trying to get a better handle on longer term trading but I don't think I've formulated a great exit strategy to avoid the slumps.

- Also, I'm not talking about trading in a Roth IRA account, this account would be just my own personal investments

[craigerv]

https://www.tdameritrade.com/pricing.html

"ETFs eligible for commission-free trading must be held at least 30 days. If you sell an eligible ETF within the 30-day hold period, a short-term trading fee will apply."

I've only looked at a couple of different brokerages but I remember thinking that the short term trading fee was a normal rule.

[Dutchy]

It's been a while since this thread has grown and I am looking to start trading ETFs sometime in the next 2 years (I want to kick the student loans first). First of all, what are your recommendations for a brokerage? I've looked up TD Ameritrade, they seem to offer many free ETFs. My main question is about the fees for not holding the ETF for long enough. I have been coming up with a few systems that trade around 2-3 times per month just based on TSP rules. But I notice with ETFs there is a fee for not holding longer than say 30 days or so. I think it was something on the order of $20 or something. My question, is do you just swing trade and take the fee since it's probably less than any gains you would make on your trade? Or do you use a longer term approach and look for better buying opportunities? I've been trying to get a better handle on longer term trading but I don't think I've formulated a great exit strategy to avoid the slumps.

- Also, I'm not talking about trading in a Roth IRA account, this account would be just my own personal investments


SmartMoney.com has a good comparsion of online brokers. Go to the Home page and search for best online brokers. Sorry, I don't know how to include link here.. Good Luck!

[Kaufmanrider]

https://www.tdameritrade.com/pricing.html

"ETFs eligible for commission-free trading must be held at least 30 days. If you sell an eligible ETF within the 30-day hold period, a short-term trading fee will apply."

I've only looked at a couple of different brokerages but I remember thinking that the short term trading fee was a normal rule.

Interesting, not with Schwab funds. I have been trading them for a couple years now, at least 4-6 moves a month.

I am happy with Schwab.

[Ron55]

For the short term trades outside of an non IRA account what is your tax hit?

[Kaufmanrider]

For the short term trades outside of an non IRA account what is your tax hit?

I have been trading ETF's in two ROTH IRA's, no tax. I just opened a brokerage, so assume this year will be the standard Capitol Gains rate, 15%. I think. It's not a big account, yet, so I don't expect to have to pay much.