More on Science
Tomas Pueyo
2 years ago
Soon, a Starship Will Transform Humanity
SpaceX's Starship.
Launched last week.
Four minutes in:
SpaceX will succeed. When it does, its massiveness will matter.
Its payload will revolutionize space economics.
Civilization will shift.
We don't yet understand how this will affect space and Earth culture. Grab it.
The Cost of Space Transportation Has Decreased Exponentially
Space launches have increased dramatically in recent years.
We mostly send items to LEO, the green area below:
SpaceX's reusable rockets can send these things to LEO. Each may launch dozens of payloads into space.
With all these launches, we're sending more than simply things to space. Volume and mass. Since the 1980s, launching a kilogram of payload to LEO has become cheaper:
One kilogram in a large rocket cost over $75,000 in the 1980s. Carrying one astronaut cost nearly $5M! Falcon Heavy's $1,500/kg price is 50 times lower. SpaceX's larger, reusable rockets are amazing.
SpaceX's Starship rocket will continue. It can carry over 100 tons to LEO, 50% more than the current Falcon heavy. Thousands of launches per year. Elon Musk predicts Falcon Heavy's $1,500/kg cost will plummet to $100 in 23 years.
In context:
People underestimate this.
2. The Benefits of Affordable Transportation
Compare Earth's transportation costs:
It's no surprise that the US and Northern Europe are the wealthiest and have the most navigable interior waterways.
So what? since sea transportation is cheaper than land. Inland waterways are even better than sea transportation since weather is less of an issue, currents can be controlled, and rivers serve two banks instead of one for coastal transportation.
In France, because population density follows river systems, rivers are valuable. Cheap transportation brought people and money to rivers, especially their confluences.
How come? Why were humans surrounding rivers?
Imagine selling meat for $10 per kilogram. Transporting one kg one kilometer costs $1. Your margin decreases $1 each kilometer. You can only ship 10 kilometers. For example, you can only trade with four cities:
If instead, your cost of transportation is half, what happens? It costs you $0.5 per km. You now have higher margins with each city you traded with. More importantly, you can reach 20-km markets.
However, 2x distance 4x surface! You can now trade with sixteen cities instead of four! Metcalfe's law states that a network's value increases with its nodes squared. Since now sixteen cities can connect to yours. Each city now has sixteen connections! They get affluent and can afford more meat.
Rivers lower travel costs, connecting many cities, which can trade more, get wealthy, and buy more.
The right network is worth at least an order of magnitude more than the left! The cheaper the transport, the more trade at a lower cost, the more income generated, the more that wealth can be reinvested in better canals, bridges, and roads, and the wealth grows even more.
Throughout history. Rome was established around cheap Mediterranean transit and preoccupied with cutting overland transportation costs with their famous roadways. Communications restricted their empire.
The Egyptians lived around the Nile, the Vikings around the North Sea, early Japan around the Seto Inland Sea, and China started canals in the 5th century BC.
Transportation costs shaped empires.Starship is lowering new-world transit expenses. What's possible?
3. Change Organizations, Change Companies, Change the World
Starship is a conveyor belt to LEO. A new world of opportunity opens up as transportation prices drop 100x in a decade.
Satellite engineers have spent decades shedding milligrams. Weight influenced every decision: pricing structure, volumes to be sent, material selections, power sources, thermal protection, guiding, navigation, and control software. Weight was everything in the mission. To pack as much science into every millimeter, NASA missions had to be miniaturized. Engineers were indoctrinated against mass.
No way.
Starship is not constrained by any space mission, robotic or crewed.
Starship obliterates the mass constraint and every last vestige of cultural baggage it has gouged into the minds of spacecraft designers. A dollar spent on mass optimization no longer buys a dollar saved on launch cost. It buys nothing. It is time to raise the scope of our ambition and think much bigger. — Casey Handmer, Starship is still not understood
A Tesla Roadster in space makes more sense.
It went beyond bad PR. It told the industry: Did you care about every microgram? No more. My rockets are big enough to send a Tesla without noticing. Industry watchers should have noticed.
Most didn’t. Artemis is a global mission to send astronauts to the Moon and build a base. Artemis uses disposable Space Launch System rockets. Instead of sending two or three dinky 10-ton crew habitats over the next decade, Starship might deliver 100x as much cargo and create a base for 1,000 astronauts in a year or two. Why not? Because Artemis remains in a pre-Starship paradigm where each kilogram costs a million dollars and we must aggressively descope our objective.
Space agencies can deliver 100x more payload to space for the same budget with 100x lower costs and 100x higher transportation volumes. How can space economy saturate this new supply?
Before Starship, NASA supplied heavy equipment for Moon base construction. After Starship, Caterpillar and Deere may space-qualify their products with little alterations. Instead than waiting decades for NASA engineers to catch up, we could send people to build a space outpost with John Deere equipment in a few years.
History is littered with the wreckage of former industrial titans that underestimated the impact of new technology and overestimated their ability to adapt: Blockbuster, Motorola, Kodak, Nokia, RIM, Xerox, Yahoo, IBM, Atari, Sears, Hitachi, Polaroid, Toshiba, HP, Palm, Sony, PanAm, Sega, Netscape, Compaq, GM… — Casey Handmer, Starship is still not understood
Everyone saw it coming, but senior management failed to realize that adaption would involve moving beyond their established business practice. Others will if they don't.
4. The Starship Possibilities
It's Starlink.
SpaceX invented affordable cargo space and grasped its implications first. How can we use all this inexpensive cargo nobody knows how to use?
Satellite communications seemed like the best way to capitalize on it. They tried. Starlink, designed by SpaceX, provides fast, dependable Internet worldwide. Beaming information down is often cheaper than cable. Already profitable.
Starlink is one use for all this cheap cargo space. Many more. The longer firms ignore the opportunity, the more SpaceX will acquire.
What are these chances?
Satellite imagery is outdated and lacks detail. We can improve greatly. Synthetic aperture radar can take beautiful shots like this:
Have you ever used Google Maps and thought, "I want to see this in more detail"? What if I could view Earth live? What if we could livestream an infrared image of Earth?
We could launch hundreds of satellites with such mind-blowing visual precision of the Earth that we would dramatically improve the accuracy of our meteorological models; our agriculture; where crime is happening; where poachers are operating in the savannah; climate change; and who is moving military personnel where. Is that useful?
What if we could see Earth in real time? That affects businesses? That changes society?
Jack Burns
3 years ago
Here's what to expect from NASA Artemis 1 and why it's significant.
NASA's Artemis 1 mission will help return people to the Moon after a half-century break. The mission is a shakedown cruise for NASA's Space Launch System and Orion Crew Capsule.
The spaceship will visit the Moon, deploy satellites, and enter orbit. NASA wants to practice operating the spacecraft, test the conditions people will face on the Moon, and ensure a safe return to Earth.
We asked Jack Burns, a space scientist at the University of Colorado Boulder and former member of NASA's Presidential Transition Team, to describe the mission, explain what the Artemis program promises for space exploration, and reflect on how the space program has changed in the half-century since humans last set foot on the moon.
What distinguishes Artemis 1 from other rockets?
Artemis 1 is the Space Launch System's first launch. NASA calls this a "heavy-lift" vehicle. It will be more powerful than Apollo's Saturn V, which transported people to the Moon in the 1960s and 1970s.
It's a new sort of rocket system with two strap-on solid rocket boosters from the space shuttle. It's a mix of the shuttle and Saturn V.
The Orion Crew Capsule will be tested extensively. It'll spend a month in the high-radiation Moon environment. It will also test the heat shield, which protects the capsule and its occupants at 25,000 mph. The heat shield must work well because this is the fastest capsule descent since Apollo.
This mission will also carry miniature Moon-orbiting satellites. These will undertake vital precursor science, including as examining further into permanently shadowed craters where scientists suspect there is water and measuring the radiation environment to see long-term human consequences.
Artemis 1 will launch, fly to the Moon, place satellites, orbit it, return to Earth, and splash down in the ocean. NASA.
What's Artemis's goal? What launches are next?
The mission is a first step toward Artemis 3, which will lead to the first human Moon missions since 1972. Artemis 1 is unmanned.
Artemis 2 will have astronauts a few years later. Like Apollo 8, it will be an orbital mission that circles the Moon and returns. The astronauts will orbit the Moon longer and test everything with a crew.
Eventually, Artemis 3 will meet with the SpaceX Starship on the Moon's surface and transfer people. Orion will stay in orbit while the lunar Starship lands astronauts. They'll go to the Moon's south pole to investigate the water ice there.
Artemis is reminiscent of Apollo. What's changed in 50 years?
Kennedy wanted to beat the Soviets to the Moon with Apollo. The administration didn't care much about space flight or the Moon, but the goal would place America first in space and technology.
You live and die by the sword if you do that. When the U.S. reached the Moon, it was over. Russia lost. We planted flags and did science experiments. Richard Nixon canceled the program after Apollo 11 because the political goals were attained.
Large rocket with two boosters between two gates
NASA's new Space Launch System is brought to a launchpad. NASA
50 years later... It's quite different. We're not trying to beat the Russians, Chinese, or anyone else, but to begin sustainable space exploration.
Artemis has many goals. It includes harnessing in-situ resources like water ice and lunar soil to make food, fuel, and building materials.
SpaceX is part of this first journey to the Moon's surface, therefore the initiative is also helping to develop a lunar and space economy. NASA doesn't own the Starship but is buying seats for astronauts. SpaceX will employ Starship to transport cargo, private astronauts, and foreign astronauts.
Fifty years of technology advancement has made getting to the Moon cheaper and more practical, and computer technology allows for more advanced tests. 50 years of technological progress have changed everything. Anyone with enough money can send a spacecraft to the Moon, but not humans.
Commercial Lunar Payload Services engages commercial companies to develop uncrewed Moon landers. We're sending a radio telescope to the Moon in January. Even 10 years ago, that was impossible.
Since humans last visited the Moon 50 years ago, technology has improved greatly.
What other changes does Artemis have in store?
The government says Artemis 3 will have at least one woman and likely a person of color.
I'm looking forward to seeing more diversity so young kids can say, "Hey, there's an astronaut that looks like me. I can do this. I can be part of the space program.”
Sam Warain
3 years ago
Sam Altman, CEO of Open AI, foresees the next trillion-dollar AI company
“I think if I had time to do something else, I would be so excited to go after this company right now.”
Sam Altman, CEO of Open AI, recently discussed AI's present and future.
Open AI is important. They're creating the cyberpunk and sci-fi worlds.
They use the most advanced algorithms and data sets.
GPT-3...sound familiar? Open AI built most copyrighting software. Peppertype, Jasper AI, Rytr. If you've used any, you'll be shocked by the quality.
Open AI isn't only GPT-3. They created DallE-2 and Whisper (a speech recognition software released last week).
What will they do next? What's the next great chance?
Sam Altman, CEO of Open AI, recently gave a lecture about the next trillion-dollar AI opportunity.
Who is the organization behind Open AI?
Open AI first. If you know, skip it.
Open AI is one of the earliest private AI startups. Elon Musk, Greg Brockman, and Rebekah Mercer established OpenAI in December 2015.
OpenAI has helped its citizens and AI since its birth.
They have scary-good algorithms.
Their GPT-3 natural language processing program is excellent.
The algorithm's exponential growth is astounding. GPT-2 came out in November 2019. May 2020 brought GPT-3.
Massive computation and datasets improved the technique in just a year. New York Times said GPT-3 could write like a human.
Same for Dall-E. Dall-E 2 was announced in April 2022. Dall-E 2 won a Colorado art contest.
Open AI's algorithms challenge jobs we thought required human innovation.
So what does Sam Altman think?
The Present Situation and AI's Limitations
During the interview, Sam states that we are still at the tip of the iceberg.
So I think so far, we’ve been in the realm where you can do an incredible copywriting business or you can do an education service or whatever. But I don’t think we’ve yet seen the people go after the trillion dollar take on Google.
He's right that AI can't generate net new human knowledge. It can train and synthesize vast amounts of knowledge, but it simply reproduces human work.
“It’s not going to cure cancer. It’s not going to add to the sum total of human scientific knowledge.”
But the key word is yet.
And that is what I think will turn out to be wrong that most surprises the current experts in the field.
Reinforcing his point that massive innovations are yet to come.
But where?
The Next $1 Trillion AI Company
Sam predicts a bio or genomic breakthrough.
There’s been some promising work in genomics, but stuff on a bench top hasn’t really impacted it. I think that’s going to change. And I think this is one of these areas where there will be these new $100 billion to $1 trillion companies started, and those areas are rare.
Avoid human trials since they take time. Bio-materials or simulators are suitable beginning points.
AI may have a breakthrough. DeepMind, an OpenAI competitor, has developed AlphaFold to predict protein 3D structures.
It could change how we see proteins and their function. AlphaFold could provide fresh understanding into how proteins work and diseases originate by revealing their structure. This could lead to Alzheimer's and cancer treatments. AlphaFold could speed up medication development by revealing how proteins interact with medicines.
Deep Mind offered 200 million protein structures for scientists to download (including sustainability, food insecurity, and neglected diseases).
Being in AI for 4+ years, I'm amazed at the progress. We're past the hype cycle, as evidenced by the collapse of AI startups like C3 AI, and have entered a productive phase.
We'll see innovative enterprises that could replace Google and other trillion-dollar companies.
What happens after AI adoption is scary and unpredictable. How will AGI (Artificial General Intelligence) affect us? Highly autonomous systems that exceed humans at valuable work (Open AI)
My guess is that the things that we’ll have to figure out are how we think about fairly distributing wealth, access to AGI systems, which will be the commodity of the realm, and governance, how we collectively decide what they can do, what they don’t do, things like that. And I think figuring out the answer to those questions is going to just be huge. — Sam Altman CEO
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Protos
3 years ago
StableGains lost $42M in Anchor Protocol.
StableGains lost millions of dollars in customer funds in Anchor Protocol without telling its users. The Anchor Protocol offered depositors 19-20% APY before its parent ecosystem, Terra LUNA, lost tens of billions of dollars in market capitalization as LUNA fell below $0.01 and its stablecoin (UST) collapsed.
A Terra Research Forum member raised the alarm. StableGains changed its homepage and Terms and Conditions to reflect how it mitigates risk, a tacit admission that it should have done so from the start.
StableGains raised $600,000 in YCombinator's W22 batch. Moonfire, Broom Ventures, and Goodwater Capital invested $3 million more.
StableGains' 15% yield product attracted $42 million in deposits. StableGains kept most of its deposits in Anchor's UST pool earning 19-20% APY, kept one-quarter of the interest as a management fee, and then gave customers their promised 15% APY. It lost almost all customer funds when UST melted down. It changed withdrawal times, hurting customers.
- StableGains said de-pegging was unlikely. According to its website, 1 UST can be bought and sold for $1 of LUNA. LUNA became worthless, and Terra shut down its blockchain.
- It promised to diversify assets across several stablecoins to reduce the risk of one losing its $1 peg, but instead kept almost all of them in one basket.
- StableGains promised withdrawals in three business days, even if a stablecoin needed time to regain its peg. StableGains uses Coinbase for deposits and withdrawals, and customers receive the exact amount of USDC requested.
StableGains scrubs its website squeaky clean
StableGains later edited its website to say it only uses the "most trusted and tested stablecoins" and extended withdrawal times from three days to indefinite time "in extreme cases."
Previously, USDC, TerraUST (UST), and Dai were used (DAI). StableGains changed UST-related website content after the meltdown. It also removed most references to DAI.
Customers noticed a new clause in the Terms and Conditions denying StableGains liability for withdrawal losses. This new clause would have required customers to agree not to sue before withdrawing funds, avoiding a class-action lawsuit.
Customers must sign a waiver to receive a refund.
Erickson Kramer & Osborne law firm has asked StableGains to preserve all internal documents on customer accounts, marketing, and TerraUSD communications. The firm has not yet filed a lawsuit.
Thousands of StableGains customers lost an estimated $42 million.
Celsius Network customers also affected
CEL used Terra LUNA's Anchor Protocol. Celsius users lost money in the crypto market crash and UST meltdown. Many held CEL and LUNA as yielding deposits.
CEO Alex Mashinsky accused "unknown malefactors" of targeting Celsius Network without evidence. Celsius has not publicly investigated this claim as of this article's publication.
CEL fell before UST de-pegged. On June 2, 2021, it reached $8.01. May 19's close: $0.82.
When some Celsius Network users threatened to leave over token losses, Mashinsky replied, "Leave if you don't think I'm sincere and working harder than you, seven days a week."
Celsius Network withdrew $500 million from Anchor Protocol, but smaller holders had trouble.
Read original article here
Athirah Syamimi
3 years ago
Here's How I Built A Business Offering Unlimited Design Services in Just One Weekend.
Weekend project: limitless design service. It was fun to see whether I could start a business quickly.
I use no-code apps to save time and resources.
TL;DR I started a business utilizing EditorX for my website, Notion for client project management, and a few favors to finish my portfolio.
First step: research (Day 1)
I got this concept from a Kimp Instagram ad. The Minimalist Hustler Daily newsletter mentioned a similar and cheaper service (Graphically).
I Googled other unlimited design companies. Many provide different costs and services. Some supplied solely graphic design, web development, or copywriting.
Step 2: Brainstorming (Day 1)
I did something simple.
What benefits and services to provide
Price to charge
Since it's a one-person performance (for now), I'm focusing on graphic design. I can charge less.
So I don't overwhelm myself and can accommodate budget-conscious clientele.
Step 3: Construction (Day 1 & 2)
This project includes a management tool, a website, and a team procedure.
I built a project management tool and flow first. Once I had the flow and a Notion board, I tested it with design volunteers. They fake-designed while I built the website.
Tool for Project Management
I modified a Notion template. My goal is to keep clients and designers happy.
Team Approach
My sister, my partner, and I kept this business lean. I tweaked the Notion board to make the process smooth. By the end of Sunday, I’d say it’s perfect!
Website
I created the website after they finished the fake design demands. EditorX's drag-and-drop builder attracted me. I didn't need to learn code, and there are templates.
I used a template wireframe.
This project's hardest aspect is developing the site. It's my first time using EditorX and I'm no developer.
People answer all your inquiries in a large community forum.
As a first-time user developing a site in two days, I think I performed OK. Here's the site for feedback.
4th step: testing (Day 2)
Testing is frustrating because it works or doesn't. My testing day was split in two.
testing the workflow from payment to onboarding to the website
the demand being tested
It's working so far. If someone gets the trial, they can request design work.
I've gotten a couple of inquiries about demand. I’ll be working with them as a start.
Completion
Finally! I built my side project in one weekend. It's too early to tell if this is successful. I liked that I didn't squander months of resources testing out an idea.
Justin Kuepper
3 years ago
Day Trading Introduction
Historically, only large financial institutions, brokerages, and trading houses could actively trade in the stock market. With instant global news dissemination and low commissions, developments such as discount brokerages and online trading have leveled the playing—or should we say trading—field. It's never been easier for retail investors to trade like pros thanks to trading platforms like Robinhood and zero commissions.
Day trading is a lucrative career (as long as you do it properly). But it can be difficult for newbies, especially if they aren't fully prepared with a strategy. Even the most experienced day traders can lose money.
So, how does day trading work?
Day Trading Basics
Day trading is the practice of buying and selling a security on the same trading day. It occurs in all markets, but is most common in forex and stock markets. Day traders are typically well educated and well funded. For small price movements in highly liquid stocks or currencies, they use leverage and short-term trading strategies.
Day traders are tuned into short-term market events. News trading is a popular strategy. Scheduled announcements like economic data, corporate earnings, or interest rates are influenced by market psychology. Markets react when expectations are not met or exceeded, usually with large moves, which can help day traders.
Intraday trading strategies abound. Among these are:
- Scalping: This strategy seeks to profit from minor price changes throughout the day.
- Range trading: To determine buy and sell levels, range traders use support and resistance levels.
- News-based trading exploits the increased volatility around news events.
- High-frequency trading (HFT): The use of sophisticated algorithms to exploit small or short-term market inefficiencies.
A Disputed Practice
Day trading's profit potential is often debated on Wall Street. Scammers have enticed novices by promising huge returns in a short time. Sadly, the notion that trading is a get-rich-quick scheme persists. Some daytrade without knowledge. But some day traders succeed despite—or perhaps because of—the risks.
Day trading is frowned upon by many professional money managers. They claim that the reward rarely outweighs the risk. Those who day trade, however, claim there are profits to be made. Profitable day trading is possible, but it is risky and requires considerable skill. Moreover, economists and financial professionals agree that active trading strategies tend to underperform passive index strategies over time, especially when fees and taxes are factored in.
Day trading is not for everyone and is risky. It also requires a thorough understanding of how markets work and various short-term profit strategies. Though day traders' success stories often get a lot of media attention, keep in mind that most day traders are not wealthy: Many will fail, while others will barely survive. Also, while skill is important, bad luck can sink even the most experienced day trader.
Characteristics of a Day Trader
Experts in the field are typically well-established professional day traders.
They usually have extensive market knowledge. Here are some prerequisites for successful day trading.
Market knowledge and experience
Those who try to day-trade without understanding market fundamentals frequently lose. Day traders should be able to perform technical analysis and read charts. Charts can be misleading if not fully understood. Do your homework and know the ins and outs of the products you trade.
Enough capital
Day traders only use risk capital they can lose. This not only saves them money but also helps them trade without emotion. To profit from intraday price movements, a lot of capital is often required. Most day traders use high levels of leverage in margin accounts, and volatile market swings can trigger large margin calls on short notice.
Strategy
A trader needs a competitive advantage. Swing trading, arbitrage, and trading news are all common day trading strategies. They tweak these strategies until they consistently profit and limit losses.
Strategy Breakdown:
Type | Risk | Reward
Swing Trading | High | High
Arbitrage | Low | Medium
Trading News | Medium | Medium
Mergers/Acquisitions | Medium | High
Discipline
A profitable strategy is useless without discipline. Many day traders lose money because they don't meet their own criteria. “Plan the trade and trade the plan,” they say. Success requires discipline.
Day traders profit from market volatility. For a day trader, a stock's daily movement is appealing. This could be due to an earnings report, investor sentiment, or even general economic or company news.
Day traders also prefer highly liquid stocks because they can change positions without affecting the stock's price. Traders may buy a stock if the price rises. If the price falls, a trader may decide to sell short to profit.
A day trader wants to trade a stock that moves (a lot).
Day Trading for a Living
Professional day traders can be self-employed or employed by a larger institution.
Most day traders work for large firms like hedge funds and banks' proprietary trading desks. These traders benefit from direct counterparty lines, a trading desk, large capital and leverage, and expensive analytical software (among other advantages). By taking advantage of arbitrage and news events, these traders can profit from less risky day trades before individual traders react.
Individual traders often manage other people’s money or simply trade with their own. They rarely have access to a trading desk, but they frequently have strong ties to a brokerage (due to high commissions) and other resources. However, their limited scope prevents them from directly competing with institutional day traders. Not to mention more risks. Individuals typically day trade highly liquid stocks using technical analysis and swing trades, with some leverage.
Day trading necessitates access to some of the most complex financial products and services. Day traders usually need:
Access to a trading desk
Traders who work for large institutions or manage large sums of money usually use this. The trading or dealing desk provides these traders with immediate order execution, which is critical during volatile market conditions. For example, when an acquisition is announced, day traders interested in merger arbitrage can place orders before the rest of the market.
News sources
The majority of day trading opportunities come from news, so being the first to know when something significant happens is critical. It has access to multiple leading newswires, constant news coverage, and software that continuously analyzes news sources for important stories.
Analytical tools
Most day traders rely on expensive trading software. Technical traders and swing traders rely on software more than news. This software's features include:
-
Automatic pattern recognition: It can identify technical indicators like flags and channels, or more complex indicators like Elliott Wave patterns.
-
Genetic and neural applications: These programs use neural networks and genetic algorithms to improve trading systems and make more accurate price predictions.
-
Broker integration: Some of these apps even connect directly to the brokerage, allowing for instant and even automatic trade execution. This reduces trading emotion and improves execution times.
-
Backtesting: This allows traders to look at past performance of a strategy to predict future performance. Remember that past results do not always predict future results.
Together, these tools give traders a competitive advantage. It's easy to see why inexperienced traders lose money without them. A day trader's earnings potential is also affected by the market in which they trade, their capital, and their time commitment.
Day Trading Risks
Day trading can be intimidating for the average investor due to the numerous risks involved. The SEC highlights the following risks of day trading:
Because day traders typically lose money in their first months of trading and many never make profits, they should only risk money they can afford to lose.
Trading is a full-time job that is stressful and costly: Observing dozens of ticker quotes and price fluctuations to spot market trends requires intense concentration. Day traders also spend a lot on commissions, training, and computers.
Day traders heavily rely on borrowing: Day-trading strategies rely on borrowed funds to make profits, which is why many day traders lose everything and end up in debt.
Avoid easy profit promises: Avoid “hot tips” and “expert advice” from day trading newsletters and websites, and be wary of day trading educational seminars and classes.
Should You Day Trade?
As stated previously, day trading as a career can be difficult and demanding.
- First, you must be familiar with the trading world and know your risk tolerance, capital, and goals.
- Day trading also takes a lot of time. You'll need to put in a lot of time if you want to perfect your strategies and make money. Part-time or whenever isn't going to cut it. You must be fully committed.
- If you decide trading is for you, remember to start small. Concentrate on a few stocks rather than jumping into the market blindly. Enlarging your trading strategy can result in big losses.
- Finally, keep your cool and avoid trading emotionally. The more you can do that, the better. Keeping a level head allows you to stay focused and on track.
If you follow these simple rules, you may be on your way to a successful day trading career.
Is Day Trading Illegal?
Day trading is not illegal or unethical, but it is risky. Because most day-trading strategies use margin accounts, day traders risk losing more than they invest and becoming heavily in debt.
How Can Arbitrage Be Used in Day Trading?
Arbitrage is the simultaneous purchase and sale of a security in multiple markets to profit from small price differences. Because arbitrage ensures that any deviation in an asset's price from its fair value is quickly corrected, arbitrage opportunities are rare.
Why Don’t Day Traders Hold Positions Overnight?
Day traders rarely hold overnight positions for several reasons: Overnight trades require more capital because most brokers require higher margin; stocks can gap up or down on overnight news, causing big trading losses; and holding a losing position overnight in the hope of recovering some or all of the losses may be against the trader's core day-trading philosophy.
What Are Day Trader Margin Requirements?
Regulation D requires that a pattern day trader client of a broker-dealer maintain at all times $25,000 in equity in their account.
How Much Buying Power Does Day Trading Have?
Buying power is the total amount of funds an investor has available to trade securities. FINRA rules allow a pattern day trader to trade up to four times their maintenance margin excess as of the previous day's close.
The Verdict
Although controversial, day trading can be a profitable strategy. Day traders, both institutional and retail, keep the markets efficient and liquid. Though day trading is still popular among novice traders, it should be left to those with the necessary skills and resources.