I see dead people.Quote from NoDoji:
I see support and resistance.
I see a level where price might go if another level breaks.
I see ways to participate with low risk relative to potential reward.
I see the action of price sweeping me into a position.
If "it" doesn't happen, I see a small payment to the market.
If "it" does happen, I see a paycheck!
http://www.elitetrader.com/vb/showthread.php?s=&threadid=276076&perpage=10&pagenumber=13
Anyone not making 200k a year from trading is a piker
- Thread starter gmst
- Start date
Pikers!
Everything Is relative. You can live well making 50K/yr in wyoming. 50K in NYC is what pan handlers make. I recall some guy last year had a thread where he made 50K trading from pakistan, said he lives like a king.
someone making a living trading for more than 5 years is no piker. However if someone is not making more than 100K trading, you can ask if it's worth the effort. The time, energy and cost spent by self educated traders is better spent building a well paying career.
someone making a living trading for more than 5 years is no piker. However if someone is not making more than 100K trading, you can ask if it's worth the effort. The time, energy and cost spent by self educated traders is better spent building a well paying career.
200K USD seems to be a reasonable general cutoff for anyone in US, Europe, or Japan. Seems like 200K/yr is the upper limit of a "normal" non-finance career salary in advanced economies not including bonus, benefits, stock options, etc. Anything beyond that, you are a superstar or a high level executive with in-demand skills -- i.e., you are likely better off concentrating on your career.
However, when you think about it further, even 200K is likely not enough to be your sole income. In a traditional job, you get a lot more than your salary -- you get health insurance (not cheap for individuals in the US), and you get retirement savings, often with substantial company matching or contributions, and in addition you often get stock options and stock awards which could range from being like a good bonus to being a lifetime source of income.
Considering how short a typical profitable trading career is (around 5-10 years on average), one probably then would need to be able to save a minimum of about $5 million at the end of that trading career to effectively compete with a good career job with retirement and health benefits. Assuming one can hold on for 10 years, that means one needs $500K / year, not counting living expenses. If you count living expenses, one would probably need a minimum of $150K if you have kids and would like to live a reasonable, normal life style. So now, we are talking about $650K per year.
This topic has been touched upon by many, but given my current career options, these are honestly the numbers I would have to make to be able to go full time trading.
On the other hand, plan B is to do trading on the side as supplemental income in addition to your traditional job with benefits. In that case, I would say every dollar counts, even $20K / year would help with the bills, etc. as long as you are not sacrificing your career doing this.
However, when you think about it further, even 200K is likely not enough to be your sole income. In a traditional job, you get a lot more than your salary -- you get health insurance (not cheap for individuals in the US), and you get retirement savings, often with substantial company matching or contributions, and in addition you often get stock options and stock awards which could range from being like a good bonus to being a lifetime source of income.
Considering how short a typical profitable trading career is (around 5-10 years on average), one probably then would need to be able to save a minimum of about $5 million at the end of that trading career to effectively compete with a good career job with retirement and health benefits. Assuming one can hold on for 10 years, that means one needs $500K / year, not counting living expenses. If you count living expenses, one would probably need a minimum of $150K if you have kids and would like to live a reasonable, normal life style. So now, we are talking about $650K per year.
This topic has been touched upon by many, but given my current career options, these are honestly the numbers I would have to make to be able to go full time trading.
On the other hand, plan B is to do trading on the side as supplemental income in addition to your traditional job with benefits. In that case, I would say every dollar counts, even $20K / year would help with the bills, etc. as long as you are not sacrificing your career doing this.
Wow.
Looking at the approximate current income of everyone I know, only three meet your criteria for a "good career" and they are all entrepreneurs who run their own businesses. I'm pretty sure that comes out to less than 5% of the people I know.
Kind of like the numbers attributed to consistently profitable traders (who also can run their own business).
So the odds of getting into a "good career" vs. making a living as a trader seem to be about the same.
I think the way to go would be to pursue the path that best fits your passions and personality.
Notice I said career job, not any job. I would define a career job as those that are pursued by people who were lucky enough to have identified what they are good at back in high school or earlier, worked hard, got into a decent school, majored in what they were driven to do, and landed a job in their field.
Then they would stick to that field for their entire career (even if they change jobs), gaining valuable experience and knowledge (i.e., knowledge that employers need to carry out their business profitably, not knowledge that you think is useful) for 30 years before they retire. Those people typically get good career jobs: relatively high level jobs (not necessarily executive but up to middle management) at large companies, or even higher level jobs at smaller companies.
Don't get me wrong, these people were not only hard-working but very lucky too, avoiding traps or major illnesses during their youth, born in an educated middle class family, received good primary and secondary education, etc. etc. Life is unfair, but basically that doesn't change the fact that there are millions and millions of people like this in the US or throughout the developed world.
I know a lot of these types, more than 50 (because I work at a fortune 500 well established company) who all make more than 150K but max out before 200K and retire. But these guys all have really fantastic retirement, health, and stock option / stock award benefits. For these guys, one would need the amount I outlined before they quit and moved to full time trading. In fact for these guys, talking about trading is akin to talking about drugs or illicit sex.
One of the biggest concerns for a trader making an average income would be no access to credit. The average cubicle cowboy is usually not able to make major purchases with cash--- but he/she can go to the bank and get a loan for a car, house, or anything else.
It seems that for a trader, living on that same income would necessitate a sparse, minimalist lifestyle, since he cannot go to the bank and get a loan. If the trader is making significant money, or has other assets, or has a spouse who works, then this would not be such a problem. But for the individual trader we hear of in internet folklore, it would be, would it not?
For an individual trader, making 40k a year, where's the upside? Especially when that 40k doesn't come in regular weekly installments. There will be winning streaks and losing streaks, returns will be variable. Go big or go home if you want to be a trader. If you desire a minimalist lifestyle there are far easier and less stressful ways to make that happen.
It seems that for a trader, living on that same income would necessitate a sparse, minimalist lifestyle, since he cannot go to the bank and get a loan. If the trader is making significant money, or has other assets, or has a spouse who works, then this would not be such a problem. But for the individual trader we hear of in internet folklore, it would be, would it not?
For an individual trader, making 40k a year, where's the upside? Especially when that 40k doesn't come in regular weekly installments. There will be winning streaks and losing streaks, returns will be variable. Go big or go home if you want to be a trader. If you desire a minimalist lifestyle there are far easier and less stressful ways to make that happen.
Didn't you need $50,000 as an "opportunity lost" payment for taking a 10 day combine to publicly demonstrate your TA skills?
I've already publicly demonstrated my TA skills for several years on ET's forum, in ET's old chat room, and in a few Skype groups. I was actually trading while doing this, so there was no lost opportunity.
Last year you kept challenging me to demonstrate skills already demonstrated several times (for far more than 10 days, too). You made it clear that you believe TA traders make money despite TA, not because of it, so there was nothing at all to gain from the combine challenge. I had no interest in taking an unpaid leave from work to do this yet again. It seemed very important to you at the time, but not to me.
Happy Independence Day!
My theories on social labor economics:
(1) your equilibrium income is equal to the value you provide to society
(2) your services become more valuable if they are in short supply
(3) you may transiently receive more than what you provide, but over the long haul, that always corrects itself naturally because there will be forces that ensure this happens (i.e., other people)
(4) on the other the hand the opposite is not true: you may receive less than what you provide indefinitely unless you do something about it -- you are your only advocate to look after and correct such inequities
(5) everyone has the potential to provide something of value to society
(6) if one wants to maximize income, one should cultivate a skill that provides great value to society and at a level that is in short supply in your field
(7) one way to achieve (6) is to cultivate any useful skill to the point of being the top 1% in your field
(8) generally speaking, it is much easier to create something of tremendous value from a team of productive smart like minded people, rather than from individual effort alone (think about airplanes, drugs, computing infrastructure, useful production software, useful web services, movie production, etc).
(9) number (8) means that one needs to cultivate collaborative skills in addition to one's technical skills and knowledge
(10) being able to express innate abilities in forms that are useful to society is also an important skill that many lack
(11) another way to create apparent supply shortage of your skill is to brand yourself such that you appear to be the only person who can provide the unique service (celebrities use this strategy)
(12) another major way to increase your income is to be able to replicate the in-demand short-supply services you provide through some means involving resources other than your time, and ensuring ownership of the income stream from that replicated service.
(13) generally speaking, if one stays focused on a normal educational and career progression, then one usually gets a linear return on their effort, i.e., the more work you put in, the more you will get out linearly. This happens when your skill set is good but generally available (i.e., it is a commoditized skill set).
(14) However, to truly break out from the pack and become exceptional, you must achieve non-linear returns, which can be achieved by methods (7), (11), or (12).
(15) There are certain fields that are by their nature defined to be supply constrained. These are usually a result of a winner-take-all or winner-take-most structure. A tell-tale sign of this type of field is if you know of top practitioners that are making nonlinear out-sized returns for their efforts (e.g., sports stars, traders, successful musicians, etc).
(16) It is generally ill-advised (i.e., your odds of success will be miniscule) if you try to be successful in the types of fields defined in (15).