There is no percentage in taking home overnight trading positions. Don't do it!
Even if you are occasionally right, in the long run overnight positions are usually net losses and cause anxiety and pressure that may affect your next-day trading activities. You don't need this kind of aggravation, so don't do it. No overnightsget it!
QUESTION: What is the definition of an investment?
ANSWER: A trade that went bad.
Under no circumstances let your bad trades become your future. If you do, you are relying on investing rather than on trading skill. The decision processes of an investor and a trader are different. When you invest in a stock, you are looking for intrinsic value and anticipated future performance of the issuer over a long period of time. In DAET you are looking to capitalize on the intraday movements in stock prices.
Investing is a permissible and legitimate activity. The business of America is business, and I encourage you to invest in and for your future. You may invest as much as you wish, but don't allow adverse trades to become your retirement portfolio. This is the rationale behind my "no overnight positions" rule, which is an automatic mechanism for preventing the very human desire to avoid financial pain by postponing a loss.
Selling Short
The American way is to invest for the long term. Most American investors are investing for the long-term future and are buying on the expectation that the stock market will continue to go up. It doesn't take genius to make money in a bull market where stocks are going up independently of any action that any one trader or investor is taking. A bull market can cover a universe of trading sins.
