The Champion of US Stock Day Trading Contest – David Liu

Day Trading Philosophy: Many a Little and a Good Attitude

 

US Stock Day Trading Contest ended in success with tremendous support from students in early December. David LIU, a year-three student from National Taiwan Normal University, beat more than 600 participants and won the contest with a remarkable ROI score. Although he is as same as many student investors who are not familiar with “US stocks” and “day trading”, he still gave the contest a go and triumphed over others. His success was attributed to two main rules: “Many a little makes a mickle.” and “Always keep a good attitude.”

 

Overcome Fear and Trade Flexibly

 

“The most important rule in trading is overcoming fears.” Said Liu.

 

According to the contest regulations, contestants were required to finish at least 300 times of trading within the period, which means, they had to trade at least 40 times a week. Moreover, generally speaking, students were not familiar with US stocks. Adding to these barriers, there was time zone difference between Hong Kong, Macau and Taiwan markets and US markets. It was never an easy job for students who aimed at finishing at least 300 transactions before the contest ended. Every second count. Once failed, they had to say bye-bye to the prizes. Liu suggested us to overcome fears and stay calm. “If a transaction makes you feel worried and bad, you should cover your loss immediately and calm down. Otherwise, your decisions will be greatly affected by fears.” Attitude determines altitude.

 

Yet, not only with good altitude could lead to success, flexible trading techniques also played an essential role. Different to the general public, Liu set neither a target buying point nor a selling point. Instead, he just followed the trend of the market and time. When the moving average increased, he bought more. When it decreased, he sold to eliminate loss. When it remained unchanged, he carried out the liquidation. His memories were still fresh when being asked about the most frightening transaction he made.

 

“In order to widen the difference and make sure I can get the prizes, I decided to buy the most fluctuating stock, XunLei .” It was a bold decision because, during the contest, its price slid significantly due to a quarrel of its subsidiary with digital currencies. He targeted the rebound afterward and bought XunLei stocks. It was such a disheartening experience to him. “I was very frightened and worried because if I went to a wrong direction, I would lose immediately. But luckily, I got the right timing and earned quite a lot.” So modest was him who attributed his success to good luck, in fact, it was all about his flexible trading techniques.

Many a Little Makes a Mickle

 

In long-term investment, discerning students investors can win a contest with a big difference between the buying and selling point of a potential stock. In contrast, in day trading, contestants had to trade frequently and finish at least 300 transactions within the period. Therefore, Liu could not win the contest with profits from just a few significant transactions. He had to stay calm and accumulate profits little by little so as to widen the gap to other contestants. It was a long-lasting battle. His success was not achieved overnight. Actually, it took time and efforts by accumulating small profits to his great success.

 

Every Moment Counts

 

Being restricted to the business time in the USA, contestants had to adapt to the difference in time zone and fulfill the transaction requirements. They were not allowed to stop. Liu told us that the greatest difficulty was chasing with time. “Since it was already the time for sleep when the US stock market opens at 10:30 at night, and I was restricted to hedging, I could only grab the opportunities sooner after the market opened.” The difference in time zone enormously restricted his activities. “Even though I got the right time and chance, I had to stop trading when I sleep. I could not do long-term investment.”

 

However, only with challenges, can a person grow up. Vocabularies such as “frightening”, “exciting”, and “challenging” popped out in his mind when being asked about his feeling in these two months.

 

“US Stock Day Trading was greatly different from previous contests. It was much more challenging, especially two weeks before it ended, the ranking changed every day! It was so frightening!” Expressed him. The list of top three was as fluctuating as stock prices during the weeks before the contest ended.

 

A Tiro Devoted to US Stock Trading

 

Some of you may think that Liu is an experienced investor who could trade unfamiliar US stocks smartly, but in fact, he just started investing in November 2015. There was a forex investment contest held by the FDT Group promoted in his university. As being fascinated by a slogan on the poster, he downloaded a mobile application called “FDT Trader” immediately, joined the contest and won it luckily. By then, his wonderful investing journey with the application started.  

 

He was used to focussing on Taiwan stocks and Taiwan futures, and do short-term future trading. US stock is a brand-new item to him. It was a saying from the famous investor, Warren Buffett, pushed him to join this contest, “You never do unfamiliar investments and buy unknown products.” Liu said that we are surrounded by products from the USA, such as iPhone and McDonald. Nevertheless, since the general public does not know how to trade, they lost a good chance to earn more. He recalled his regretful experience when he was in secondary school. Early when he was still small and fresh, he foresaw the bright future of Facebook. Yet, he did not buy its stock. Now, its price is already nine times that at that time. Encouragingly, regretful feelings did not bother him. “I determined to give myself a chance to study US stocks in this contest (US Stock Day Trading Contest). Also, I think only practices can make one grow up, so I grabbed this opportunity and joined the contest. I hoped I can get the real fund.” As he wished, he won the game and learned new things.

US Stocks: Free, Rich in Variety, and Low-risk

 

Compared with Taiwan stocks, Liu pointed out that US stocks are freer, richer in variety, and lower in risk. For instance, US stocks are not restricted to the 10-percent daily price variation. There are also various products people can buy. The risk of suffering from systematic error is also comparatively low. However, in the Taiwan stock market, when the prices of TSMC and LPCL falls, the whole stock market may collapse.

 

Continue his Career in the Investment Sector

 

“Investment is my biggest interest now.” Said Liu.

 

Liu is the president of the Securities Study Society in his university. He loves reading books and exchanging investment ideas in the cafe run by the FDT Group near his university. Investment is everywhere in his life. He decided to continue his investment career in the financial engineering sector, and earn more for a better living standard in the future.

Editor’s Words

 

It was my greatest honor to having a phone call with Liu. I found that he did not become ignorant even though he won the game. In fact, he humbly attributed his triumph to his good luck. I was impressed by his modesty. At the end, may I express my sincere wish to all of you a bright future in investment!