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bored with the routine of their professions. They use DAET as a diversion from their regular career activities. Since DAET is very short term in its nature, anyone can participate for even a short period during the day. The excitement and intensity invigorates these DAET traders, and usually they find it a wonderful escape from their everyday world. All they need is a Level II quotation service and a remote hookup into their trading system and they are all set to participate in this exciting arena. Usually these Direct Access Electronic Traders stay in the most volatile, actively traded stocks so they can participate in the action and get the moves they seek in short periods of time during the day. Their styles vary, and DAET is done as much for the enjoyment of trading as it is for gain. |
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The nature of the DAET business is such that on average about once a month, or at least every couple of months, there is an unusually large, intraday move in an active Nasdaq stock. An active Nasdaq stock is one that is very often traded by the majority of Direct Access Electronic Traders (e.g., Apple, Microsoft, Intel, CISCO). On occasion an active stock will be the subject of takeover speculation or other news and move several points in a matter of minutes. The astute trader utilizing almost any style will jump in on these situations and usual make a windfall profit. Although instances like this do not occur on a daily or weekly basis, they do occur on average about 6 to 10 times a year and are a real shot in the arm to DAET. While most career Direct Access Electronic Traders do not count on these windfalls, they do occur fairly often and are very instrumental in significantly increasing the annual income of the DAET trader. |
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As we approach the central trading market, these windfall dislocations should fade away. Most significant corporate news is now announced after the close or before the opening, in order to minimize the intraday price impact on the stock. The result is that traders are less subject to the major intraday swings that can generate a windfall profit or loss. As long as |
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