Is trading worth it in my situation?

[R. Raskolnikov]

Does a kid who is just about to start medical school ask how many brain surgeries he will be performing on people in his first year?

You should know that most everyone struggles for the first two years (or more) to make anything, let alone not blow their account up. If you are breakeven after two years of frequent trading, I would consider that a huge victory.

Quote from Angelusx:

Hello,


I just recently learned about the existence of day trading and was wondering if I could use it to my advantage.

I'm a computer science major and when I graduate in 1,5 years I'm planning on starting my own webdevelopment company, which means I'll be spending 4-6 hours a day in front of a computer programming applications. Making it pretty easy to keep an eye on the markets and make trades all day long. (probably just normal day trading, because I'd be a little too busy with my programming to do scalp day trading)

Now I'm aware that long term investments like stocks and real estate generate a return of about 7% (taking inflation into account), but when it comes to day trading the numbers are a little less reliable. For day trading i've been finding all kinds of different percentages ranging from 10% to 300% (mostly the people who posted some return of investment between 20% and 30% seemed to be the most reliable).

I have no intention of using day trading as a kind of get-rich-quick-scheme, but more as a nice little bonus on the side of my webdevelopment business. But ofcourse the amount of time in research and trading itself that I put in must be worth it in returns. Because if it doesn't generate a significant percentage above 7% i'd ofcourse be better off just making a long term investment with my extra money.

So now i have 2 questions:

the first one: if I do my research, stick to a system, never take absurd risks, is a consistent yearly return on investment of 12% (accounting for inflation) possible?

the second one: considering my approach, situation, available time, is 12% a realistic number, or a little bit of a low estimate?
If so, what kind of ROI can i realistically count on?

 

[Angelusx]

Quote from feng456:

Lol you aren't getting the joke...

this forum is notorious for a lot of loud mouthed idiots who make ridiculous claims about making 100000000% a second.

i would be wary of listening to anyone here, especially those who have only been here a year or two.

I thought so, but I wasnt sure and just went with it to avoid bringing about a shitstorm in my direction

Quote from nursebee:

It is unrealistic to expect to beat the market.

Search daytrading studies

So are you saying daytrading is a fruitless effort?

Quote from R. Raskolnikov:

Does a kid who is just about to start medical school ask how many brain surgeries he will be performing on people in his first year?

You should know that most everyone struggles for the first two years (or more) to make anything, let alone not blow their account up. If you are breakeven after two years of frequent trading, I would consider that a huge victory.

I'm of course talking about the long run, I wouldnt mind losing some of my money the first couple of years, as long as in 30-40 years I reach an average of a couple of % above the 7% norm for a normal investment.

The reason I'm looking into trading is basically because of the money it can save me yearly investing for my retirement. If I can get an average of 12%/year over 40 years, that would mean I could put aside 200 euro less every year than I if I go for a long term investment of 7% to get the same final amount.

 

[lindq]

Quote from Angelusx:

Hello,
Making it pretty easy to keep an eye on the markets

You can't do both at the same time without seriously detracting from building your career. Which is where your complete focus should be, especially when just starting out.

The market will always be here. But your opportunities to get a good start on your career will quickly pass.

And in answer to your specific questions, there is no possible way for you to project/imagine/speculate on returns and LOSSES from trading.

 

[wrbtrader]

Quote from Angelusx:

...I'm not planning to do day trading as my main profession. Like I said, I just heard about it recently and figured since I'm in front of my computer 6 hours a day during my work, I might as well just do some day trading on the side, adding to the capital I make with web application development.

Day trading is not recommended to be approached as a hobby even though you didn't use that word. The odds are very high that you'll lose whatever money you put into it if you have that hobby mentality.

Is it a suitable part-time job as a second source of income ?

I prefer to say that there's other better alternatives for those that have another job and want to do trading on the side (your words) during the duration they have that other job. Those alternatives for such types of folks like you are swing trading or position trading...not day trading.

In contrast, if you plan on day trading outside of work hours such as before you go to work or after you go to work...most likely you'll be trading in markets not in your time zone. The other concern with day trading like that (before/after work) is that it complicates your social life as a part-time day trader...very few can successfully manage a social life and part-time day trader career while both are in conflict with each other.

My above comments is because you said you might as well do some day trading because you'll already be at work in front of a computer for 6 hours per work day. Simply, you're saying you plan on day trading while at work. Not good...don't do day trading as such and its really not fair to your boss to have an employee as such.

Once again, swing trading or position trading is the way to go for folks like you.