I am a new trader with under $25,000 looking to day trade, what should I do to start?

tomorton said:
No enterprise with a 90% failure rate and a 5 year start-up time (or 10,000 hours of learning or whatever way its put) is worth undertaking.

Therefore, taking this summary as fact, seek an alternative approach to trading. Use a proven strategy which is simple enough to be learned in 1 day and thoroughly understood in 2 more: demo trade it for 1 month until consistently profitable: extend this in 1 month increments until consistency is achieved. This almost certainly excludes daytrading.
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"...[tomorton] No enterprise with a 90% failure rate and a 5 year start-up time (or 10,000 hours of learning or whatever way its put) is worth undertaking..."

You are probably correct, but I wasn't referring only to day trading. If one knows how to day trade the SPX, one knows how to trade in general. It's all the same, regardless of the market and regardless of the time frame. There's just "much more of it" in proper day trading.

The biggest problem with trading is, nobody teaches how to do it... at least not the proper way. So it's up to the trader to "figure it out on his own". That seems to take an inordinate amount of time.

(Years ago I ran a mutual fund timing service. We had all of the slippage from "end-of-day fills only", but every aspect of TA is still the same today as it was back then.... but like I said, "much faster and more of it" in the ES if you care to play for it.)
 
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qlai said:
I wander what your reasoning is? Unscalable/Unsustainable, maybe? Can't argue it doesn't work.


Ok, so it's fragmented. How is it a problem for your average daytrader? You have provided lots of insightful info regarding infrastructure, but I don't see how it's relevant to a guy trading 25k to 5M account. He will not be market making. US Equities market is the most retail friendly due to regulations, imho. Forex and Cryptos ... Anything goes ... You don't even have access to an official/regulated data feed to reference. Maybe your style of trading takes advantage of such inefficiencies but equities are too mature for them? Curious to know your opinion.
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With regards to Warrior Trading et. al. there has never been an official statement nor has there been any video of his platform showing the fills. I would not call him out or say it's a scam without any proof, but I personally doubt he's for real.
And even if he was, he trades microcap momentum so if you try to replicate his trades, you'll be fighting over fills with your peers.




There is one thing, however, every novice needs to understand: In the markets there is no minor leage, puppy bonus, however you'd like to call it. It's like you start your football training right in the superbowl.

So when you say, "you're a pro so for you it's relevant but for the other guy who just wants to start out with a small account it's not"...wrong!
Whenever you are pressing the button to buy and sell, you are considered to be a pro, because you are competing against professionals. So it's your choice weither you want to be knowledgeable and prepared or not.

Just a small numbers example:

Lets say you have a 50k account and you do 500,000 shares a year. That's not much, 2000 shares per day average, perhaps you trade 500 share positions and get stopped out once (that would be 1000 shares) and try again.

Let's say you have a 5% edge on those 500k shares, so you net 25,000$ at the end of the year (and be honest, how many people do you think achieve returns like that?)
Now you are slipped just 2cts average...which totals 10,000$ per year and almost cuts your return in half.

I hope it becomes clear why all that stuff matters to everybody and why there is no such trader like the "small fry who doesn't harm anyone JUST TRYING to get by on 100$ a day". You need to get into every nook and cranny and understand every piece of the puzzle and exploit every single bit of edge you can find.

And it doesn't matter that you don't have enough money to cover the costs or trade without PDT, the market doesn't care.
 
Scataphagos said:
It's all the same, regardless of the market and regardless of the time frame. There's just "much more of it" in proper day trading.
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No, it's not. Just because you make it all the same, it doesn't mean it is. Also, there is no such thing as "proper" daytrading. It's either profitable or not. Just because a red doji falling hammer morning star reversal pattern looks the same in Italian interest rate futures and the soybean crush spread that doesn't mean you trade it the same way.

So nobody teaches "proper" daytrading, because in order to do so he'd have to share his edge with you. And nobody would ever do that....at least I won't.

But how do you know if somebody has a real strategy or not? He can explain in one sentence why he makes money
 
MrMuppet said:
No, it's not. Just because you make it all the same, it doesn't mean it is. Also, there is no such thing as "proper" daytrading. It's either profitable or not. Just because a red doji falling hammer morning star reversal pattern looks the same in Italian interest rate futures and the soybean crush spread that doesn't mean you trade it the same way.

So nobody teaches "proper" daytrading, because in order to do so he'd have to share his edge with you. And nobody would ever do that....at least I won't.

But how do you know if somebody has a real strategy or not? He can explain in one sentence why he makes money
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Your naivete is showing.
 
I'm with you Scataphagos, the market generally trades very similarly in most time frames.

My original response to the original poster is to start on longer time frames...he will get eaten allive slower and have a chance to learn. Short term is the hardest because of the vig and the speed at which you need to operate. Chance of survival is slim.
 
tomorton said:
Therefore, taking this summary as fact, seek an alternative approach to trading. Use a proven strategy which is simple enough to be learned in 1 day and thoroughly understood in 2 more: demo trade it for 1 month until consistently profitable: extend this in 1 month increments until consistency is achieved. This almost certainly excludes daytrading.
More...

Agree, anyone can learn a decent method in a day, probably a few hours! Money management too i.e. how much to risk.

What takes time is the psychology...amongst other stuff, dealing with 10-20 losing trades in a row and keep going is very tough.
 
Palindrome said:
I'm with you Scataphagos, the market generally trades very similarly in most time frames.

My original response to the original poster is to start on longer time frames...he will get eaten allive slower and have a chance to learn. Short term is the hardest because of the vig and the speed at which you need to operate. Chance of survival is slim.
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When you "trade on a longer time frame", you have to ignore this and that. (The biggest problem is "counters". How do you handle those?) If/when you learn to cope with the same vagaries, your potential goes waaayyyy up while your risk goes waaay down. AND it's applicable to all time frames, all markets. (Not that you have to "trade all time frames and all markets like you could possibly trade the ES"... but it's worth a great deal to understand. Some people are going to question... "trading red wheat, gold, ES, currencies.. all the same?" How can that be? Well, it be... believe it or not.)
 
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