Engineer looking to make a career change into trading

True, so true. If all it took to succeed at trading were an Engineering degree or an MBA or the ability to write and code software, then clearly success in the field would not be so elusive for the vast majority who attempt a go at it.

It might even be a fair generalization to say that a majortiy of the 'eggheads' and 'geeks' employed at trading firms are indeed technical support staff or analysts.

Quote from hajimow:

Here is my definite response to you as a trader with PhD in EE who is 50 with 16 years of trading experience.

1-I don't know what is your age and what field of engineering you are. Don't be proud of your degree. Many high school grad will eat you alive in trading. Most of the compliments to you come from engineers. Actually they are complimenting themselves.

2- Don't be so sure that you can always go back to your work after quitting. When you are out of your field for a year or two, you are almost unhirable.

3- I guess most probably this desire comes from your "few" recent profitable trades. Take my challenge. Start from today and try to make 10% in the next 6 months. So if you have 50K, just make 5K in the next 6 months. Remember you can get 200K margin with your 50K in your regular trading account instead of 500K in prop firm. So you just need to make 5K in 200K capital. If you reach that goal, come to this thread and lets talk.

4- During that 6 months period, don't spend a dime from your salary. Put all in the bank and don't touch it. Rent, food, bills should come from your trading account or your saving and not your salary.
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Quote from hajimow:

Here is my definite response to you as a trader with PhD in EE who is 50 with 16 years of trading experience.

1-I don't know what is your age and what field of engineering you are. Don't be proud of your degree. Many high school grad will eat you alive in trading. Most of the compliments to you come from engineers. Actually they are complimenting themselves.

2- Don't be so sure that you can always go back to your work after quitting. When you are out of your field for a year or two, you are almost unhirable.

3- I guess most probably this desire comes from your "few" recent profitable trades. Take my challenge. Start from today and try to make 10% in the next 6 months. So if you have 50K, just make 5K in the next 6 months. Remember you can get 200K margin with your 50K in your regular trading account instead of 500K in prop firm. So you just need to make 5K in 200K capital. If you reach that goal, come to this thread and lets talk.

4- During that 6 months period, don't spend a dime from your salary. Put all in the bank and don't touch it. Rent, food, bills should come from your trading account or your saving and not your salary.
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hi hajimow, I believe you are very successful, n I couldn't agree no more. The trading part sounds exciting, but when it comes to tabulating the PnL, I think it turns off alot of so-to-be trader.

And I hv tried many ways to convince friends who wants to be a trader, but they failed and failed, badly, month after month, year aft year.
 
Quote from sneakoner:

I live on the East Coast but that is really good advice. Do you have any advice on how to pick a market, stock, or etf to trade? Also what strategy should I use?

I feel like I read all these books and understand whats out there but there are a million+ strategies, indicators, etc to choose from. I have no idea where to begin...
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I can identify with that. You'll be a successful trader 5 years from now. If you quit your job, can you live with $10k-$20k/yr for the next 5 years? Apparently, this is the barrier to entry in this "profession". 95% of traders don't make it not b/c they don't have any talent or edge. It's b/c they can't last 5 years living below the poverty line.

It's like training to be a doctor, you don't see the big money until 7 years later.

In trading, once you hit 5 years of learning experience, all of a sudden, you magically make over six figures a year. Most people quit just as their trading ambition is about to be realized. If they had stuck to it, 1-2 years later, they would have seen their annual PnL jump by a multiple of 5-10X.

Edge is simply gained experience. Anyone who lasts 5 years or more will gain an edge.

It's like taking martial arts. There's no way you cannot do a nice/perfect roundhouse kick after 5 years of training.
 
Quote from heech:

You're asking if it's reasonable to double your money every year (putting in $50k and making $100k a year). I don't think it will take you too much time to decide how reasonable that really is.

I agree with the earlier comment: as an engineer, you have actual knowledge/skills/experience that you invested money and dollars to hone... which in practice delivers real economic value. By day-trading, you will instead be playing mouse-click games with no discernible edge against high-school drop-out professional poker players living in their mom's basement.
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Oh, pulleeze. Discounting last year, neke on these forum has been more than tripling his money each year for the last 5 years.

I've done it two times over the last 5 years. Gave back a lot of it b/c I couldn't handle myself after a big winning. (currently into my 5th year of trading, btw.)
 
any suggestions on good back testing platforms for stocks? daily timeframe is all I need, as swing trading suits my personality and work schedule...
 
Quote from savagemp5:

hi hajimow, I believe you are very successful, n I couldn't agree no more. The trading part sounds exciting, but when it comes to tabulating the PnL, I think it turns off alot of so-to-be trader.

And I hv tried many ways to convince friends who wants to be a trader, but they failed and failed, badly, month after month, year aft year.
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I agree with you. Many traders promise themselves to follow the rules after they they blow their account and then they do few profitable trades after that but it is not not because they are following their rules, it is because the market was not in a way that they needed to apply the rules and then after a few days/weeks, they make the same mistakes. That is why I believe having an engineering degree makes you capable of calculating your profit or loss quickly !! but maybe not more.I believe people who are very kind to their wives or husbands or kids and rarely get angry can become a better trader. They can control their nerve. I also believe that you should lose to become a successful trader. I remember in the early years that I started to trade (1997-998), BRE-X mineral was the world largest gold company and I invested 15K in that because the shares dropped $2 but in a week, they realized that they have no gold and they were manipulating the gold samples. My 15K dropped to 0. I was a PhD student at that time. I cried. I was so miserable. The lesson that I learned, was that trading is not a fair game and if you lose, no one will help you but if you can cheat, please do, it is legal !!.
 
On the other side of the coin of keeping a day job and not ever having to experience trading at a professional level , is its easy to be complacent because of security from of income from day job.

By professional level trading I mean deriving most or all your income from the markets to such an extent that income from day job comparatively becomes minuscule.
 
Quote from Bolimomo:

My advice is: see if you can "engineer" a work schedule for yourself where you can trade the opening hours (may be first 2). The heavy price actions are the first 2 hours. Then the market enters a doldrums in most days. And the last 2 hours got back with some movements (usally, not always). And the closing hour actions are not as good/profitable as the first two. If you want to do both, working a full time job and trade the first two hours are quite manageable, especially if you live in the US west coast. After you get consistently profitable, and you conclude that having a full-time job will deter you from making more money from trading, then quit.
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First off, TONS of engineers in here! I can't say I'm surprised (I am as well).

Secondly, +1000 to the above advice. I have 4 friends that all tried to trade for a living, while I kept my day job and pecked away. 2 years later I am still here and they have all blown out and moved on. Again I would say find a way to trade the first 2 hours and still work. my .02 is don't focus on trying to learn exactly where the market will turn, just try to study the behaviour (through price and volume) that usually leads to that turn. Trading got so much easier when I visualized volume and price as actual people making transactions instead of lines and bars on the screen. If you can personalize the movements, you can usually bet on people making the same decision you would if you were in their situation. Good luck! :D
 
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