I just want to clear up a few misconceptions from idiots and sloppy lazy thinkers that shoot from the mouth with their emotions rather than sit back and think before they do so..
I have not started to trade properly but have been learning at an intense rate 24/7 since my first $2K loss (my initiation) that reminds me of learning whilst studying for my masters..utterly intense and enlightening...
So heres 10 pointers for newbies pre their first account to set the record straight and stop the confusion...
1. If you are new, please dont listen to people who tell you that x amount of money is not enough to trade, this is nonsense. If you can establish an account and place some trades, thats a huge step but keep it as small as you can because very few people make money out of gate.. its a suprise to see your account steadily dwindle but you need to FEEL & SEE this for yourself before you can begin to engage in that learning process. This is absolutely critical, and sorry..no shortcuts possible (although some will claim there are..ignore them). Rather it is prudent NOT to put any large amount in at all!!, .. ... they will blurt out "you need $100K to do it properly".. what complete doofuses they are.. these are the "numpties" who will blow out soon relax...
2. Please understand that there is no real disadvantage from working on your own, (its quiete and comfortable...anyone who talks of boredom has something terribly wrong with either thier trading style or themselves and the markets because trading is intense.. if you are not in the market you are scanning for support/resistance/overall trand.. yesterdays hi-li and pattern.. the next likly move on daily charts for tomorrow..its intense.. the time will fly by if youve got it right... Also prop firms have advantages too.. you can accelerate your growth but realise a. Would you really employ anyone who didnt have experience?? NO.. but you would if they could bring money to the table right?.. think think think...also if any firm collapses, they take your stake with them... think about that.. your broker should be very well established
3. Fees are a massive issue, if you are trading futures and paying more than $3.50 round turn inc exchange fees, Id say keep your options open..Ive calculated it actually makes financial sense to pay more upfront for a platform say than to have have that money come out of every round turn. e.g. Velocity Futures (great firm, but if you dont pay for the X_Trader platform the round turns are bring water to my eyes $4.75...man!!) Vs GNI TOUCH (owned by MANN financial..the very largest Futures brokers in the world- ultra low round turn fees ($1.50per 1000RT despite having to pay $750 pm for platform is still cheaper all in!!) DO THE MATH WITH YOUR BROKER.
4. In my opinion I strongly suggest opening a small broker account before learning (be 100% prepared to lose it say $1000 even maybe with a spreadbetting firm, although serious traders should never daytrade using such horrible accounts,and if you do use a spreadbetting firm for learning ONLY.. never ever fund it again.. and see what you can do with it to start with. This will provide you with the reality JOLT you need, the jolt that allows you to connect with the issues of entry and exit. Take at least 1 month off after this excersize and learn from books and web sites and magazines like Traders etc what on earth they are doing right. This will focus you in the right direction, dont change this process.. this has been distilled from hours of hard intense learning, reading and review for the optimal learning experience. Sure paper trade also.. but you must at some point use real money and then take a min 1 month break to learn.
5. Never ever trade without a stop or limit to exit the position.. you are not yet Gordon Geko, this is simply foolish and unnecessary, and psychologically weak..for it tells your subconscious you are free to cut corners, then your discipline (ability to trade only your plan) falls away and you start making discretionary trades throwout the day chopping and changing your strategy so fast you end up guessing entry and exits and steadily continue to lose your money for as long as you allow that silly behavior to continue..
6. You are free to learn by using books if you are prepared to concentrate sentence by sentence.. dont listen to silly Doofus idiots who claim otherwise trust your inteligence
7. Do not whatever you do fall into the trap of interpreting the markets in a way that sees you pitched against machines, or people who are better at trading than you, this is silly nonsense. There are thousands of people entering and exiting trades, for various reasons, dont assume that this zero-sum game is as simple as win lose.. it isnt, there are also market makers whos job is to add liquidity to the market to HELP facilitate your position, there are friends also in the markets... its not about you versus someone else..get over it
8. Perhaps the the reason many lose so badly in my mind is because of a poor ability to learn to CHANGE SLIGHTLY THE APPROACH, and then set it in stone and trade the new approach with 100% diligence and without variation!!!! this is what is so challenging to many newbies, if you have ADD or similar take your medication and stay calm n focused.. Imagine like a gambler at the roulette table who knows he should walk but keeps placing the same foolish bets round after round in the hope he wins egged on by a lack of emotional control or ability to walk away from the Table (the screen) without ever adjusting his strategy or realizing he has better odds talcking another market like Poker or blackjack... this is the single most hardest challenge of them all.. it is a challenge of the mind control of the self, mental discipline.. it is the nugget that blows accounts more than anything else. The best traders make notes, even screen record thier trades AND REVIEW THEM in the hope of gaining more insight into how better they can refine thier strategy.. DO THE SAME.. there are NO shortcuts my friend!
9. Whatever style you come up with realise that the pros are heavy on scalping & spread (Pairs) trading contrary to what Ive heard here, the problem if you want to follow that style is the accuracy of your platform.. . There is no reason to suggest Futures, commodities, stocks or money markets are better than any other market because its down to you, your personality, what you feel comfortable with as an instrument, margins involved and the world in which you wish to immerse yourself in regarding the fundamentals of the market..e.g. Energy (weather, OPEC WARS) or Money Markets (interest rates, political speeches, Economic Macro forcast news)
10. Ultimately it is a balance between win and lose.. as such it is your job to make sure you get every single edge possible tipped in your winning favour:
Get these edges and your on your way
Platform
Exchange fees
Know your Contract details small print
News services, (quality of fundamantals & TIMING of that information
KNOW YOUR FOLLOW UP ACTIONS REGARDING POSITIONS BEFORE YOU TRADE especialy for Options traders
