A Day in the Life of the Traders Expo
Yesterday marked the conclusion of the fifth annual International Traders Expo, which brought more than 100 exhibitors, speakers and vendors into contact with 9,000 active and professional traders for three days in Times Square. It was my first time attending, and I was quite impressed with the event's execution in terms of preparation and overall professionalism. In what could have been total chaos, this was a well-organized and efficiently run event.
They've had five years of practice putting together this event, and I wondered how it compared with those of past years, especially when it was launched at the height of the stock market bubble and daytrading craze. With that kernel of contrary thinking, I reminded myself I wasn't someone trying to gain investment advice, pick an online broker or choose a trading platform. I was here as a journalist, trying to collect material for future columns (which I did). This let me approach the event as an observer and perhaps divine something about the state of the industry.
Come One, Come All:
The size and composition of those in attendance was the first good sign. Almost every seminar and workshop with an educational bent had capacity crowds with an average age tilted toward 40 -- older than I expected -- and there was a surprising number of women. The event organizers couldn't give me hard numbers, but they also felt (as did many of the exhibitors I spoke with) that the crowd was decidedly older than years past, and estimated that the female attendance, while still only around 10%, was probably double from three years ago.
While I had expected to find many young males looking for some magical system by which they could make a thrilling and profitable living at "trading," this crowd seemed to have decidedly realistic expectations and goals. The fact that all had taken the time to attend very intensive workshops -- some paying up to $800 -- showed they were a serious group committed to gaining as much knowledge and technology that would help them achieve their goals. In addition, those goals seem to be more about money management, portfolio protection and generating a better return on investments, and not trying to make as much money as possible in the shortest amount of time.
This was a practical, well-seasoned and informed crowd. I asked a question about current volatility strategies to a man in his 80s who had paid $189 for a particular session on options. He turned to me and recommended I buy straddles right now. His advice was consistent with that of all the other experts, who were nearly unanimous in the belief that volatilities are very low and that now is a good time to buy options, especially long-dated or LEAP options.
The Good:
Nearly all the speakers and exhibitors I saw, who were obviously there to ultimately peddle their wares, were providing relatively unbiased information and well-prepared presentations.
The Bad:
Of course, there was a certain amount of huckstering and salesmanship going on. Four different times I walked by a man in a booth drawing wavy lines on a piece of paper, claiming that his software could flag the tops and bottoms of stocks and enable traders to buy low and sell high. As proof of the system's success, he would note that "at the last show, there was a hedge fund manager in the next booth who was so amazed he bought the software for each and every one of his traders." I don't know if he was making any sales, but he always had a crowd around him.
The Scary:
A women at another booth was selling educational CDs and seminars with a focus on options. Claiming she was a broker, she expressed her dislike for
TheStreet.com
because it encourages people to use online brokers while her superior execution of options orders supposedly saves customers tons of money. I asked her what she thought of the recently launched Boston Options Exchange, which is the second all-electronic exchange and the first to allow for trading in penny increments. She not only had no opinion, but was unaware of the exchange's very existence. I quickly moved along...
Hope Springs Eternal:
At nearly every session, whether dealing with technical analysis, using sentiment readings or options activity, when a presenter asked the crowd for a company to apply a particular tool, someone (usually more than one) invariably requested
Lucent
(LU)
. Many of the presenters were honest enough to admit that their analytic tools couldn't reveal whether treasure lay in that sunken ship.
Best Reasoning:
Options guru Larry McMillan on why he uses a 21-day moving average on the put/call ratio: "Just in case
Fibonocci was right." As
Spinoza tried to scientifically prove the existence of God and believed everyone should lead a moral and ethical life, the logic is based on the risk/reward scenario. Simply put: It can't hurt, and there may actually be a huge upside.
Most Mixed Emotion:
Meeting a
RealMoney
subscriber who gave me and the site great compliments, but only recognized me from my name tag "because you look older than I thought you were." Hey, what do you expect ... that picture was taken nearly a year ago.
Steven Smith writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. He was a seatholding member of the Chicago Board of Trade (CBOT) and the Chicago Board Options Exchange (CBOE) from May 1989 to August 1995. During that six-year period, he traded multiple markets for his own personal account and acted as an executing broker for third-party accounts. He invites you to send your feedback to
steve.smith@thestreet.com.