break it down, holmes.
nice work
Am I a Fool For Wanting To Be a Speculator?
- Thread starter zghorner
- Start date
nice work
Some says 1 in 10 makes it in trading. But I am not so sure of this figure. Certainly, mental plays a significant role in trading. If you have $100K and wage $75K, then I suppose that's risking too much. Risking $20K is more appropriate. Unlike any other jobs, it takes a long time to understand the behavior of the market. Since, we do not know for sure each outcome of our bets, so we must be discipline enough to take appropriate action when the outcome is for or against us. Every hesitation will cost us even when the outcome is in our favor. Because this hesitation would reinforce our belief and weaken our discipline. My last hesitation costs me 4%.
Take some time and find an area where you are comfortable (options, equities, currencies, commodities, whatever) and then paper trade some ideas that you are thinking of running for a good while. When you think you have something, put $10K - $20K in it and see what happens. If you are going to make it, you should be able to start with a small stake and grow that organically. You don't want to blow out your existing nest egg while figuring this out.
The safest and wisest thing for you to do is allocate a fixed amount you are comfortable if you lose it all. Say, $5,000 as your trading capital. Put only that amount in your broker account. Do not add on to it. Add risk management and risk no more than 2% on each trade. Make sure you have a trading journal to log in all your trades. That alone is worth more than any so called gurus to mentor you and there is a lot of charlatans out there. You are better off learning on your own. If you review your trades, you can see where you are committing mistakes. Once, you minimize mistakes, you will improve your trading performance. Risk 1R and target 3R or higher. Higher is better because you only have to be right a few times to make it worth your while. So, reward should be several multiples of our risk on each trade. If you have a job, trade part time. Position trade instead, of day trading or swing trading. Focus on a longer time frame.
The good thing is you have a capital loss carry over which can offset ordinary income at $3k per year or new capital gains.
Changing into a winning trader is like having a mental illness that only you alone can diagnose & treat. Lack of knowledge is not the problem. It is the critical self analysis of our behavior in trading & being able to change it that matters the most.
My prior losses as painful as they were at the time, taught me valuable lessons that made me into a better trader down the road which I no longer regret.
Try to have some fun with your time not working, don't let your losses get you down. Old people on their death bed don't regret financial loses, they regret not doing the things they wanted to & wished they had taken more risks.
Best of luck to you.
Changing into a winning trader is like having a mental illness that only you alone can diagnose & treat. Lack of knowledge is not the problem. It is the critical self analysis of our behavior in trading & being able to change it that matters the most.
My prior losses as painful as they were at the time, taught me valuable lessons that made me into a better trader down the road which I no longer regret.
Try to have some fun with your time not working, don't let your losses get you down. Old people on their death bed don't regret financial loses, they regret not doing the things they wanted to & wished they had taken more risks.
Best of luck to you.
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Oh my god this is so true. It is so important to understand yourself. I used to think I would enjoy quantitative/automated trading but NOT AT ALL.
I like WW3 trades. I like corona virus trades.
Big numbers appeal to me.
The Can I be a pro Speculator? question can be simplified to an easy math question:
What kind of realistic annual return can I expect/make, and can I fund my broker account with so much capital that after taxes that amount covers my living expenses? And can I do that year after year, again and again?
OK, maybe a bit complex question but the answer is a rather straight forward mathematical answer. If you can answer yes to that question then welcome to the club!
What kind of realistic annual return can I expect/make, and can I fund my broker account with so much capital that after taxes that amount covers my living expenses? And can I do that year after year, again and again?
OK, maybe a bit complex question but the answer is a rather straight forward mathematical answer. If you can answer yes to that question then welcome to the club!
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ZG horner;
Most likely where they got the nickname '' SPY'' ; better than DIA,LOL.The worst way + most common way to lose big, is borrow big on a college/medical education.Good thing my banker dad paid cash for his college, me too. But trading a derivative, any derivative when we don't know what we are doing is the best way to lose BIG.
But a good thing about losing big, you get to find out why your parents didn't name you or me ''Blair Hull'' LOL. Another good thing about losing big, many cant really learn, except by costly experience.Good thing as a kid,[ as a reading kid,2] ;I studied mutual funds. mountain charts 10/20 year$ chart with dividends........................................................................
The more I meditate on this the more i feel that I tried to convince myself that being a speculator would be a meaningful life pursuit...when in reality i think that deep down I hoped it would be an expedient path to wealth. Now that my bubble of naivety has been popped I see what an absurd notion that was. I think this has all been a classic case of "get rich quick" dreaming under the veil or lie that "i want to be a trader because that would bring meaning to my life". Sad really. Not sure where to go from here.
I really do appreciate you all taking the time to comment on this thread it has helped me out.
I really do appreciate you all taking the time to comment on this thread it has helped me out.
Why not both? Instead of being a day trader, just have a normal job and speculate on the side. You don't need to be glued to a screen if your time frame is days or weeks. This way you also have job security and secured income coming in. If you make something on the side, good. But if you lose a little you are still fine and your world won't be rocked. And if your little side project is going really well after 6-12 months, you can sit down and evaluate your choices again.
The best returns posted on r/WSB are all option trades going on for days if not for weeks. Try to get motivation from that.