Friday, October 17, 2008

The RO Report, "Trading Ain't Easy" Edition

I have to say, it sucks to write this post tonight, because the RO took a massive amount of pain today. However, it highlights an important truth about trading, a truth that has been easy to forget during this last month of volatility and ridiculous trading profits.

Losses are part of trading, sometimes big losses.

However, it also highlights something important about the RO. The guys didn't take any more risk today than they normally do... the difference today is just that they were wrong. What's amazing to me now, is how often they take that massive risk and are right.

The fact that today stands out like an intellectual at a Sarah Palin rally reminds me just how good these guys are.

The reaction from many will be simply, "Yeah, but they made such a massive amount recently, this is nothing." Fine, understood, but don't forget what a psychological game trading is. "Giving back" is the most painful trading experience... probably worse than losing outright. That's actually a constant debate... or, as Tennyson put it, "'Tis better to have loved and lost/Than never to have loved at all?"

And let me add one other troubling fact about this game... your gains are taxed, egregiously... so the losses, in a way, count double.

Anyway, I'm looking forward to watching these guys bounce back. For now, let's just drink the blood and put today to rest. Out of 28 traders today, 10 were gross positive, or 36%. 5 traders made over $1,000 gross, 10 lost over $1,000 gross. I was #6 of 28, or, very lucky to have spent half the day at "parent-teacher" conferences at my daughter's school.

Here are today's "Manservants"

"Chambermaid" - Trader C, -$93,753 on 581k shares traded.

2. Trader P, -$46,847 on 597k shares traded.
3. Trader B, -$37,548 on 374k shares traded.
4. Trader F, -$28,725 on 219k shares traded.
5. Trader A, -$28,250 on 843k shares traded.

And the "Bosses"

"Lucky Pierre" - Trader D, $12,421 on 864k shares traded.

2. Trader G, $2,478 on 74,000 shares traded.
3. Trader E, $1,467 on 69,600 shares traded.
4. Trader V, $1,414 on 71,000 shares traded.
5. Trader O, $1,339 on 19,600 shares traded.

Have a restful weekend.

NOTE I: There are only 2 days left to vote in the RO member post poll. Go vote.

NOTE II: "Trader D" sprayed enough to win the song pick, however, I was unable to open the link he left in the chat. So I'll post the song tonight. If Trader D gets in touch with me over the weekend, I will post his song as a "special dedication" to the RO.


TRader said...

DT u scum don't forget to post my song!

trader d

Dinosaur Trader said...


Post me a link... I wasn't in the room at the end of the day...


Dinosister said...
This comment has been removed by the author.
Dinosister said...

now SCUMGOD is a funny word!
Way better than fishass or yambag...

Dinosaur Trader said...

Scumgod is a common term around the office.

Those who trade and don't share are called simply, "scums." The "scumgod" title actually has a tinge of respect to it, because our office is fucked up like that.


Joe said...

"your gains are taxed, egregiously"

Wait till Obama gets in there. You'll be paying through the teeth.

Dinosaur Trader said...

Dude. Enough with the scare tactics. All Americans hate taxes. Obama is a compromiser, not an idiot like Bush, so I can't see him fucking around too much with the main tax rates.


Dinosaur Trader said...

I don't think that link I posted will work... try this.


Joe said...

If you're scared, you should be.

Proposed changes in taxes after 2008 General election:


0% on home sales up to $500,000
per home (couples) McCain does not
propose any change in existing
home sales income tax.

28% on profit from ALL home sales

How does this affect you?
If you sell your home and make a profit, you
will pay 28% of your gain on taxes.
If you are heading toward retirement
and would like to down-size your
home or move into a retirement
community, 28% of the money you
make from your home will go to taxes. This
proposal will adversely affect the
elderly who are counting on the income
from their homes as part of their retirement income.


MCCAIN 15% (no change)

OBAMA 39.6%

How will this affect you?
If you have any money invested in stock
market, IRA, mutual funds,
college funds, life insurance, retirement
accounts, or anything that pays
or reinvests dividends, you will now
be paying nearly 40% of the money
earned on taxes if Obama become president.
The experts predict that 'higher
tax rates on dividends and capital gains
would crash the stock market yet
do absolutely nothing to cut the deficit.


MCCAIN (no changes)

Single making 30K - tax $4,500
Single making 50K - tax $12,500
Single making 75K - tax $18,750
Married making 60K- tax $9,000
Married making 75K - tax $18,750
Married making 125K - tax $31,250

(reversion to pre-Bush tax cuts)
Single making 30K - tax $8,400
Single making 50K - tax $14,000
Single making 75K - tax $23,250
Married making 60K - tax $16,800
Married making 75K - tax $21,000
Married making 125K - tax $38,750

Under Obama your taxes will
more than double!
How does this affect you? No explanation
needed. This is pretty
straight forward.


MCCAIN 0% (No change, Bush repealed this tax)

OBAMA Restore the inheritance tax

How does this affect you? Many families
have lost businesses,
farms and ranches, and homes
that have
been in their families
for generations because they could not
afford the inheritance tax.
Those willing their assets to loved
ones will not only lose them to
these taxes.


* New government taxes proposed on
homes that are more than
2400 square feet

* New gasoline taxes (as if
gas weren't high enough already)

* New taxes on natural resources
consumption (heating
gas, water, electricity)

* New taxes on retirement accounts
and last but not least....

* New taxes to pay for socialized medicine
so we can receive the same
level of medical care as other
third-world countries!!!

illmighty said...
This comment has been removed by the author.
illmighty said...

Taxes are needed...we have to draw a line though.

As those who wish to make a living at trading, they cannot overlook the implications that the Obama/Biden taxes would impose on their endeavors. Obviously, there are other important matters on the table as well for the election. However, I'll pass on paying an extra 15-25% in taxes on income (cap gains) I'll be making if Obama gets in office...not to mention all the other bs taxes he'll impose as stated above (assuming those stats are correct). Will these new taxes by Obama not affect you DT and the other ballers at the RO (i.e. how are your gains reported if you don't mind me asking?)?

Dinosaur Trader said...


How about a source... that looks like a chain email.


Our profits are not taxed as capital gains. I know nothing about taxes, but I know the structure of the company as an LLC somehow means our income is not reported as capital gains. Perhaps if Trader P is reading he can break it down... or any ROer who knows, because it's not my area.


TRader said...

yo DT, here is my song pic:

The reason i pick this song, is that i disagree that todays bloodbath was only due to being wrong, and taking the same amount of risk.... the risks taken today by some were foolishly large given what was going on. Of course we are human beings and often make mistakes, lets just hope we learn from them!

About our earnings, they are taxed as short term capital gains, ie at our regular income tax level. so if Obama and team raised capital gains (as in long term capital gains) taxes, that would not affect us directly.

-trader d

TRader said...

also, what's with the censorship, I want to see these deleted posts, scum!

trader d

TV107 said...

Trader C seems to be losing a lot of money

going bust?

Dinosaur Trader said...


Those comments were removed by the "authors," not me.

Thanks for clarifying the tax situation.

@TV, no.


Jawbreaker said...

Most traders i know who trade Prop accts have a "S" Corp that they run thier profits through. It does get taxed as Capital Gains. You will be paying more in taxes under Obama, just as we did under Clinton if you traded back then. Most of the good traders i know make well over 250K a year and will get hit rather hard. Talk to a real accountant he will agree.

Whisp said...

I had to post this up in defense of Trader B and Trader Z, who took a hit yesterday, as I did. I know for a fact that these traders had a plan, an objective, and went for it, and in this game thats a quality to be admired. I have great respect for both of those guys. Trading is nothing more than a game of statistics and probabilities, there are no certainties afforded us. You use all available information (much of which is contradictory and changing each second) and you pick a side, while measuring risk and putting in place protective measures for the many times when you'll be wrong. There was some shit going off, in the middle of the day, that we've never seen before, and Trader B & Z made a conscious decision beforehand, to risk their day on the trade we were to put on. To my boy, Trader D, I'm sure you remember, I called your name out many times like, "What you doing, what are you putting on, what are you thinking?" and you had nothing to say the whole time while we were putting on the exposure, during the time the trade was working out, or when it went sharply against us. Of course we are human, and fallible in nature, and furthermore everyone is entitled to their opinion, but retroactive criticism, following complete silence in the middle of the battlefield is wack.
I don't know what risk controls Trader C or Trader P had in place because I wasn't in communication with them yesterday, but whatever, lets learn from this and move forward.

Dinosaur Trader said...


Good to see you here... someone has to keep Trader D in line...


illmighty said...

Thanks DT, "D", jaw'. I need to learn up more on them there tax laws...

Soulfire said...

Here's the real deal in figuring out your taxes under Obama/McCain:

Tax rates were fairly similar and for all the examples done that I've seen. Obama spiking everyone's taxes is unfounded.