Engineer looking to make a career change into trading

Quote from sneakoner:

you guys are really discouraging :(
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Work hard, do something productive, save money and invest into a S&P 500 index fund for the long term and you will come out better than 100% of all the traders out there.

I wish someone would've told me this 10 years ago.

(This post is the single greatest post ever on ET)
 
I've already been investing in stock index etf's, bonds, and funds

I'm looking for something full time that is more fulfilling than what I'm doing now. Trading is the one thing that interests me and something that I can see myself putting in 12-14 hour days working on.
 
Quote from sneakoner:

you guys are really discouraging :(
More...

I didn't mean to discourage an aspiring trading. Just setting expectations that trading is the most competitive business in the world and few who try will ever make it. So, don't quit your day job.
 
I understand.


But is it unreasonable to expect to make on average $500 a day using $500,000 trading capital?

The prop firm I met with offers 10:1 leverage, I figure I would put in $50,000 once I'm comfortable.

$500 a day on average ~ $100,000 a year, 20% return
 
Since your an engineer dust off those statistics books if you still have them. The market is more random than not and statistical time series regression models are very helpful. The markets are non-stationary with unit root problems or trend-stationary with or without unit root problems.

I would suggest you start on your own just to get going. Develop a strategy. Test, adjust, repeat. Test the strategy on paper first so no capital is at risk.
 
Quote from sneakoner:

I understand.

But is it unreasonable to expect to make on average $500 a day using $500,000 trading capital?

The prop firm I met with offers 10:1 leverage, I figure I would put in $50,000 once I'm comfortable.

$500 a day on average ~ $100,000 a year, 20% return
More...

This is not unreasonable.

Welcome to the game !!! :)
 
Easier said than done. You have to develop an edge first. The sword cuts both ways and you could easily be down 100k, which would be limited to your 50k put up. If you're brand spanking new to trading going prop right now with that kind of leverage is a recipe for disaster. The slower you go the faster you'll get there.

Quote from sneakoner:

I understand.


But is it unreasonable to expect to make on average $500 a day using $500,000 trading capital?

The prop firm I met with offers 10:1 leverage, I figure I would put in $50,000 once I'm comfortable.

$500 a day on average ~ $100,000 a year, 20% return
More...
 
Quote from the1:

Easier said than done. You have to develop an edge first. The sword cuts both ways and you could easily be down 100k, which would be limited to your 50k put up. If you're brand spanking new to trading going prop right now with that kind of leverage is a recipe for disaster. The slower you go the faster you'll get there.
More...

i understand, i learned never to risk more than 2% of your capital on any one trade and never risk more than 6% per month (courtesy of dr. alexander elder)

2% of 50,000 is $1000 risk per trade

6% is $3000 risk per month
 
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