Looking for Advice

[sandy_s]

that’s not true.
I know quite a few sales traders who have gone on to run successful hedge funds and successful RIA’s.

Exceptions are always there...however for someone who seem to know programming and has already the flair for dabbling in the market may land up with a job which will help him to learn about trading much faster...

 

[newwurldmn]

Exceptions are always there...however for someone who seem to know programming and has already the flair for dabbling in the market may land up with a job which will help him to learn about trading much faster...

I thought the same thing too. But my experience was that about the same percentage of sales traders and flow traders made it to the next level.

Being keen with programming and a flair for dabbling in the markets is not a skill/personality exclusive to guys on the trading desk at a junior level.

 

[sandy_s]

I thought the same thing too. But my experience was that about the same percentage of sales traders and flow traders made it to the next level.

Being keen with programming and a flair for dabbling in the markets is not a skill/personality exclusive to guys on the trading desk at a junior level.

Agree with your points....

However, to be successful in sales trading you need other skillsets as well...which may not be related to trading...

 

[newwurldmn]

Agree with your points....

However, to be successful in sales trading you need other skillsets as well...which may not be related to trading...

that only matters if you want to make a career as a salestrader. Once you are on the rocket ship, it’s surprisingly easy to switch seats.

 

[sandy_s]

Yeah...one can wander around many paths...

To get to the centre of things best bet may be to join a prop shop, market maker or a hedge fund..

 

[BlueWaterSailor]

@BlueWaterSailor I am not sure how to send you thoughts on padu's responses, because I have many funny things to type, but he has me on ignore. Without context, none of it will make sense. Alas.

Here, man, have some groove before you pull a dest on him.

Nah, bruh; I've just looked upthread, and I'm still chuckling at him throwing a shit fit. TBH, when a whacko like him claims to be a successful trader, I don't really care - but when they start messing with newbies' heads, I like to amuse myself at their expense.

Once they demonstrate all that emotional stability and self-confidence - you know, just what you'd expect from a professional trader - I'm done; don't need to stir the pot any more. In this case, it's paid off handsomely.

 

[rarefarefroghorn]

... Professional trading is all about replicating cashflows to find edge in price vs. value ...

I am quite confused on this, can you define cashflow or give more examples maybe more basic ones. I have googled the definition but am not sure if the definition is correct.

Are there any books to give me ideas of what other market participants do? Things about replicating cashflows just to understand more about what others do in-depth? I appreciate the help.

https://www.khanacademy.org/math/statistics-probability
Khan academy is great for learning this kind of stuff, I have learned many things thanks to it.

Learn these two
https://en.wikipedia.org/wiki/Curve_fitting

https://en.wikipedia.org/wiki/Overfitting


Good luck, I hope you make it. Just asking here shows that you want to improve and willingness to change. Creativity isn't about being genius, it's about persistence, that's where my username comes from. I've persisted and eventually made it.

Thanks, I know some programming so I will most likely start with python and try to develop something to identify patterns. Even if they do not work and make a loss in the long run I will have a better understanding of what works and what doesn't.

Let's say you want to win on 3 out of 5 trades (60%), or maybe 4 out of 7 (57%). The basis for your trading is just looking at timeframes and prices on chart. Pretty much everyone is doing that--including the soul-less algorithms that hedge funds run. You might get lucky here and there, and win 51 out of 100 trades, but you're not doing anything to give you a real advantage.

As a comparative example, let's look at a simple pair trade. Take two tickers that are highly correlated: such as gold/silver, General Motors/Ford, or AT&T/Verizon. Now you have additional information, instead of just price movement on one instrument, you now have two--and a measure of comparison. This give you a bit of an edge. You can expand this in different ways; perhaps add everyone's favorite, Tesla, into the mix. Now you're comparing three correlated tickers. You can add countless other influencers, with correlation coefficients, both market data and non-market.

To make a few analogies:

• Chess: you're going for a 4-step checkmate. It will work here and there, but it's not very saavy.
• Baseball, you're trying to throw a strike with a 50mph fastball.
• Football: You're running a 6.0 40.

Imagine a trade where you had a machine that told you, with p=0.75, which way $SPY would swing tomorrow morning. Now that would be a great advantage! You have to work hard to gain this insight and see these opportunities.

That's why we think you're just flipping coins. This style isn't really compelling.

Thanks I now understand why my trading could be called a coin flip. I appreciate it. Do you have any resources you think will be helpful?

Don't loose hope, I know this answer is a bit repetitive but this is what as a trader we can say and can have. You have very tragic experience and this can happens with anyone. When I started trading I also suffered a huge loss but I never traded without trading plan, no matter how much in hurry I was. I keep some basics in mind that not to over trade and do not expect much from the trend. Second most important thing is trade with stop losses (an amount of risk you can take). Always back-test your strategy on different time frames and then execute that. These are few simple do's and dont's that can help everyone to a have fair and safe trades.

I won't and I appreciate the words.

 

[kmiklas]

Thanks I now understand why my trading could be called a coin flip. I appreciate it. Do you have any resources you think will be?

The first step is to look inside yourself: what do you have that others don't? What sector do you understand? Who do you have in your life that can make you smarter than most in some market? Is there something you're interested in? Dig deep.

Focus on that little edge, and nurture it into an advantage.

That will raise your trade win percentage to 4/7 or 3/5.

 

[oraclewizard77]

Wow 6 pages of total crap advice. Here is what you should actually do. Finish college. Get a job. Earn some money.

Then once you have saved up some money you can either do some trades at night or just buy some stocks and hold them for a certain amount of time.

Now if you are really really smart. Go to MIT, and become a Quant.

https://mitsloan.mit.edu/ideas-made-to-matter/quant-pioneer-james-simons-math-money-and-philanthropy

 

[twstn]

Background:
I have traded on and off for four years. This October makes it literally the 4th year. I am a losing trader. Was always in the phase of break even in 3.5 years but this past 0.5 years I made explosive gains followed a significant loss in capital putting me in the red. I have never recovered financially from this loss.

Trading Style:
The way I trade is based on price. My theory is self taught although bits and pieces may have been taken by different information I have taken. I trade naked charts except for price levels, this means no trend lines or volume. I just trade price, the only variable I assumed to be significant. I will step you through my daily process.
I trade only SPY options. Meaning I buy calls/puts.
Premarket:

• I go from Daily -> 1 Hour -> 5m looking for areas of importance. Essentially making a price ladder of certain spots to trade.
• Already in the back of my head because I have been consistently trading I am aware of the phase of the markets. I learned to trade the V of the spy drops. Essentially on the way down and on the way up but intraday(From writing this I can see sometimes I made bad trades now that I look back by trading periods that are not within the V).

Market:

• When market opens price should be between two important levels. If not in the case of a gapup, I fail to understand where to trade.
• Let us assume the market is in the phase of dropping. Signs of this are attempts to go higher failing multiple times. Someone wants out, and this in effect causes others who ware wanted to sell to test the limits of the other sellers. They will essentially wait if price can go higher, if someone is selling at a certain price and I also need to sell, I do not know his size, therefore I wait to see how much he is willing to sell. If he keeps selling and starts dropping the price, which he does not want because it will lose him profits. This shows he knows someone else is willing to sell, or that from my perspective someone else not just the guy is selling. Meaning there are 3 sellers in total. Me, the guy I was testing, and a third. The more people who want to sell the more dramatic the drops will be, essentially leading to a inflection point where selling besets selling. This is the way I trade. I will get in on a range betting on breaking out or breaking down and trying to get the best price to ride the wave. In so getting the best price I also reduce my risk of losses if price breaks against my bet.

But I fail to do so. I do not follow my plan. Reducing risk is well but overtrading leads to losses, and losses lead to more losses for me. Maybe it is the environment, maybe it is that I need to prove myself. I don't know but I always seem to destroy my gains and some more. I increase my size, I hope instead of selling for a small loss.

All these actions seem to point to me wanting to be right. I know to be a trader one has to be willing to accept his losses. I think, I have all my hopes riding on trading. I am still in university and I am not doing well mentally. I trade for my ego not for profits, and I think that is what is killing me. I feel frustrated because in a lot of my trades I make good calls on tops and bottoms and it feels great. I just can't seem to stay disciplined. My environment has changed, I have also changed in doing so. Maybe I just need a break. I started trading 1k in my college apartments, over the past 4 weeks I made $270 on trading on only a size of 1 options contract. Then I made a mistake. I was up $60 on one contract, and I never sold. I watched the gains disappear and I lost and extra $30. This began the journey of me losing my capital throughout the next few days. Eventually leading to me being down 300 from my initial 1k.

I would appreciate any advice. I do want to be a trader and I know it is possible, I have no doubts. But I feel like I have been in this cycle for way to long. Maybe it is my system it might have never had a positive expected value I don't know how to test this. The fact is I know I make mistakes and I can't keep myself from doing so. I try to prevent it, but I am human. I have thought of ways to prevent this. I take breaks after exiting 1 trade. I read my plan before the market open. I always make mistakes.

I just can't seem to grasp onto this dream.

Best,
rarefarefroghorn

P.S. I currently do not trade. I am focusing on school.

@rarefarefroghorn, I think, at this point, it doesn't hurt for you to try what The Wall Street Now can offer if you want to trade equity. $1k is more than enough to start and test the waters. All you need is discipline and patience to follow the trading signals. Please let me know if you need more info.