Can Day Traders make a good living.
- Thread starter Kastro_316
- Start date
Dollar amounts:
32K in 1999
47K in 2000
39K in 2001
55K YTD in 2002
32K in 1999
47K in 2000
39K in 2001
55K YTD in 2002
Interesting posts about taking a "shotgun" approach to trading and being both long and short at the same time. I was just reading about Mayer Offman from Carlin Securites and this is his approach to trading. A pretty interesting way to trade but one that takes a lot of capital. But on the flipside it's a great way to put one's capital to use.
The name of the book is "Electronic Trading Masters" by Baird if anyone is interested....
Leland
The name of the book is "Electronic Trading Masters" by Baird if anyone is interested....
Leland
May I ask a question here, I am very interested in this topic as to weather or not it trading for a living (assuming that you are at least an average to good trader) is viable.
Some of you have posted, that it is possible to make modest gains and earn a good living. Say if you can make a few hundred bucks per day, and average say $640 per week. What are we talking about when you say 'make'? If you traded fairly often to make that $640 per week, how much are we subtracting out for commish? half? Now what about the taxes on what we made, probably close to 40% I believe.
So if we subtracted the 40% ($256), plus about half of the $640 for expenses, data feeds, and commissions ($320), are we talking about a net profit of around $64 dollars for that week???
I apologize in advance, if my rationale based on the above is totally illogical. In fact, I hope I am totally wrong, because if I am correct it would seem that the viability of making a decent living as a trader would be quite difficult unless the trader is extraordinary...
keop
Some of you have posted, that it is possible to make modest gains and earn a good living. Say if you can make a few hundred bucks per day, and average say $640 per week. What are we talking about when you say 'make'? If you traded fairly often to make that $640 per week, how much are we subtracting out for commish? half? Now what about the taxes on what we made, probably close to 40% I believe.
So if we subtracted the 40% ($256), plus about half of the $640 for expenses, data feeds, and commissions ($320), are we talking about a net profit of around $64 dollars for that week???
I apologize in advance, if my rationale based on the above is totally illogical. In fact, I hope I am totally wrong, because if I am correct it would seem that the viability of making a decent living as a trader would be quite difficult unless the trader is extraordinary...
keop
I believe I speak for most traders when I say this. When I discuss what I make per week,day, or year I always discuss after commission profits. I trade at home and my expenses are fairly minimal, not really much more than if i just actively used the internet. My at home business expenses are less than i believe i would spend on that morning cup of coffee ( $3 at Starbucks ) and my afternoon diet Coke ( 1$ ). My at home expenses are approx $200 a month. Now as far as taxes, I am sure i pay the same or less taxes than i would pay at a job where i grossed the same as I do trading.
The above question attributes 90% of gross trading gains to commission and office expense and that is just plain ridiculous. If i say i make $1000 a week or $5000 I am always talking about after commissions and before minor trading related expenses and I think anyone who has traded for any amount of time successfully quotes theirs the same way.
AllenZ
( I always react poorly to this question )
The above question attributes 90% of gross trading gains to commission and office expense and that is just plain ridiculous. If i say i make $1000 a week or $5000 I am always talking about after commissions and before minor trading related expenses and I think anyone who has traded for any amount of time successfully quotes theirs the same way.
AllenZ
( I always react poorly to this question )
If you make $50K trading net of commish per year (250 days x 300/day) your net could look something like the following.
Monthly Office Fees: $300 x 12 = 3600
Annual business expenses (hardware, software, subscriptions, classes, misc expenses): 5K
Net = 50K - 3.6K - 5K = 41.5K This would also be your taxable income. You would be taxed about the same as if you had a job working for someone else paying 41.5K except you don't have to pay half the FICA that an employee usually pays (7.5% or approximately 3.1K in the example above). If you trade futures you can get a much better tax deal than as an employee.
Monthly Office Fees: $300 x 12 = 3600
Annual business expenses (hardware, software, subscriptions, classes, misc expenses): 5K
Net = 50K - 3.6K - 5K = 41.5K This would also be your taxable income. You would be taxed about the same as if you had a job working for someone else paying 41.5K except you don't have to pay half the FICA that an employee usually pays (7.5% or approximately 3.1K in the example above). If you trade futures you can get a much better tax deal than as an employee.