Mentorship / training fail

I've been considering training up a mate who I'm bailing out to a small degree anyway not how to trade, but how to spot basic setups initially then contact me with trade ideas for me to then act on or not.

Reason being I get bored waiting around for a setup then 2 hours flies by and I've totally forgotten to check and missed a bunch of setups which annoys me so I switch off LOL

Tried to train 2 people so far to fully trade, both good start results then they go there own stupid way being greedy and doomed, why do stupid people think there clever, people!

If you do teach them fully, they'll just go do it alone sooner or later, this way they have no concept of Risk, News how long to hold upcoming likely market conditions, then they will maybe continue to work as a team for a cut on the trades they contact me about.

I just message them, trade exited +$500 ( they get 10% say ), next! or not taken, next! Don't want them contacting me Mid trade obviously!!

Won't charge them for losses or pay for trades I don't take that work out.
 
garachen said:
Ug. I've given this some more thought. Maybe I'll try it in a year or so when I have some time.

I've decided to pull a 180 and hire people full time to manually trade. Seems crazy, I know, but I have good reasons. The last few weeks I've spent manually trading overnight. I hate it. But there's some really good stuff there. Good enough that I'm going to teach 2-3 other guys at work. I'd rather teach a bunch of people at once so I'm looking to hire 2-3 more people. Quickly. I prefer people with little to no experience so there's less to undo. Let me know if interested. I know there's lots of people here trading from their parents basement. That's what I'm looking for. And smart with good intuition.

I will be recruiting from the usual schools too. This is a salaried job with benefits and good upside potential. I rarely have time or inclination to manually trade nowadays - but I'm still pretty good at it. It's a skill worth having. I view it as insurance. Something to fall back on if everything goes to pot.

I expect people to be consistently profitable in 2-3 months.
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I'm really surprised this hasn't attracted much more (public) response!
Seems like a great opportunity for new people to get into the business.
 
So maybe i could go take month long driving course at nascar and i could race in Daytona 500 . Been trading 12 yrs + Still learning every week . You need to put the work in . They are no short cuts .
 
garachen said:
The rest of the day we'd discuss some aspects of manual trading, exchange data, speed and matching algorithms. I'd describe general characteristics of automated trading that I've seen work.
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Some details generously provided here:
garachen said:
When I am thinking about a new trading strategy I've found it helpful to at first focus on the 'why' this strategy should make money before getting to the 'how' the strategy makes money. And if someone is explaining their strategy to me and can't answer the question of why the strategy is supposed to make money I immediately become pretty skeptical.

Trading is more than pattern seeking. Looking at patterns is helpful to identify how to make money but first you should identify why your strategy deserves to get paid - what service are you providing the market that justifies your income - and then look at patterns to then identify when this service you provide has greater or lesser value.

Here's a few of the 'why's' I can think of: (futures)

1) Providing "smart" liquidity. Stepping aside during toxic flow but taking the other side of uninformed traders. A very good strategy here makes a little less than 1/4 increment per round trip.

2) Simple information dissemination. This is the speed game. New information comes out. Economic release, crop report, pure arb, etc and prices need to move to adjust to the new reality. You serve the market by adjusting the price.

3) News dissemination. Complex news comes in many formats. Not everything is coded up to be machine readable. Standard news needs people to interpret and act. Usually you have about 2 seconds for standard products and maybe up to 10 seconds for less obvious products. Really esoteric news/product combinations can disseminate over a period of hours.

4) High correlation microstructure relationships. This is actually a good place to be in. You need to be fast but not overwhelmingly fast and there are tons of these relationships. Think of things like the energy or ag complex. Lots of relationships and short term correlations. Looks for iceburgs or stops or other short term disparities.

5) Medium term 'macro' relationships. Sometimes these get out of whack and someone needs to bring them back inline. Need to have a good understanding of the actual products to not get killed and a pretty big balance sheet.

6) Calming the panic. People and markets tend to over-react to news or to extreme price movements. They may be forced to exit a position either by their own risk tolerance or by policy at the end of the trading session. These episodes of panic that are purely price driven tend to be short lived and you can get paid to 'calm the storm'.

I think that no matter the specifics of your strategy you should always be able to answer the question of what you are providing that market that justifies you getting paid for your efforts. If not one of these reasons then something else that provides value.
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garachen said:
I've decided to pull a 180 and hire people full time to manually trade. Seems crazy, I know, but I have good reasons. The last few weeks I've spent manually trading overnight. I hate it. But there's some really good stuff there. Good enough that I'm going to teach 2-3 other guys at work. I'd rather teach a bunch of people at once so I'm looking to hire 2-3 more people. Quickly. I prefer people with little to no experience so there's less to undo. Let me know if interested. I know there's lots of people here trading from their parents basement. That's what I'm looking for. And smart with good intuition.

I expect people to be consistently profitable in 2-3 months.
More...

I did this three years ago, hired unemployed engineers that also knew how to program, all had worked for a defense contractor so I knew they be tight lipped. Eventually had nineteen of them in different phases of learning/trading, they received a base salary, bennies and percentage but not based totally on how profitable they were, it was also based on doing the rules correctly. Most had zero experience which was so much easier, some left as they couldn't stay awake in middle of night, some didn't like the boredom and some just didn't like it, am down to seven of them covering 2 shifts. It was very tough on me for a year working most days/nights 18 hours, but now well worth it. I never had more than two sitting with me for two hours and each month they had another hour added till eight hour shifts. You simple can't train brain fast enough to handle the concentration needed to trade all shift, I have a team manager that oversees all as well as I do. They built me my own back testing program, trading platform well programmed with exits and automated several methods I was manually trading. I doubt I will ever run out of ideas to back test cause we all learn new patterns or maybe simple forgot them from years ago.

I still mentor from time to time, but all know it not full time, more like fixing what they doing now or exchanging ideas. Longer you spend in trading, one realizes the entry is seldom most important and the profits come from applying your rules which are the hardest. Trading seldom looks logical and that is great as many screw that up. Sell high, sell higher, buy low, buy lower...to a point, but very few will do the type of work to understand structure, break down length/time of Swings. When people hear "Elliott wave" they run, and yet when you look at swings, there is a mixture of 3/4 waves for trending Swing, blend that with volume and what the running average of uptrend swings of past two weeks, two months, you have pretty good idea when trend might stop, makes no difference whether it is one minute bars or weekly bars, cause it is all Price Structure.

My approach is one of thousands of ways to trade, but it works for me and those I employ, and no, am not hiring any more.
 
I traded OPM and it really is interesting. First, you are a complete sheep to the guy who gave you the money. He wants the control, and likely gets it. Phone calls at night, whatever....Then other guys who were losing money would have to convince everyone else how it's an anomaly they are losing and will make it big soon. Then everyone secretly tells everyone else how everyone is a horrible trader and all that stuff gets in place to make it hard to trust anyone. I was young and fine with the stress, i didn't care. i made some money, lived my life, and watched the carnage unfold and yelling sessions happen. Then the funniest thing happened....the guy took back all his money and created an educational firm on trading. I kid you not. He said you cant teach anyone how to trade and selling is easier. it was then amazing how dumb the students were, you knew almost zero of them would make it. maybe 1 out of 100 and it wasn't from what they were taught. the key was to confuse the people so they had to pay more for other stuff. get 10k from them soon, since they would lose it all anyway. almost all were happy when they left so nobody really cared. it was an easy few hundred thousand to make and you even traded with students but who cared...you made or lost 300 bucks and they were paying you 10k. never met an educational provider who was legit...maybe they exist, but i never met one. and i met a lot. you can tell so fast how selling is so critical and smoke and mirrors is everything....funny game.
 
After I stopped letting students trade my accounts, I charged an outrageous fee, but paid by their profits each month if they got that far, Sent them three years of brokerage statements and current daily statements, they could talk to my broker and other students, they had contracts to sign and I made it extremely hard for them to go live, they had to sim trade profitable 18/20 days, Duration was for two years and chatted on phone first two hours of trading day, they could travel to where I lived any time. And even with this set up, many couldn't trade, but at least they didn't lose money unless they traded behind my back. You have to be mentally ready, I think having a part time job helps, gets one out of the house and gives one interaction with people. But I truly believe that the brain gets use to losing and I would have students let several good trades go by and then find the losers so many times, so I found mentoring others is good mixture of method but more so changing their mental outlook. Ninety nine percent of signals I do have been done by many before me and currently, but it is hard to keep pulling the trigger after three or four plus one tick trades to nail a 2pt trade in ES, and it is hard to walk away after making handful of points cause ninety minutes went by, but toughest problem all well tested traders have is following their own set of rules.

Yeah, trading OPM huge pain in ass, they call you when you having drawdown and they call you twice as much when you making money in fear you going to lose it. Never again, I rather make 100% of profits than 20%.
 
Another comical moment was when students sent in about 50k and the owners all leased expensive cars, making it seem like they were super well off. of course it worked, people love that stuff. or the guy who got 300k from his dad and put it in a trading account for a few weeks. nobody wants to ask the tough questions, so nobody does.

i knew 2 guys who handled one client, 5 million. he called all the time, pressured all the time, went crazy and forced them to put on 300 contracts and they lost, of course, 1 million. account closed. 2 guys out of work, and the other guy still making millions a year despite the loss. experiment in stress.

i knew a few portfolio managers who admitted they had 1 good year out of 10 and that was all they needed. the rest was to have everyone just wait for the one good year. i'm sure they made 400k a year.

one guy i knew sim traded for one entire year on some weird spread trades. averaged like 0.2% a month or something on sim and real, audited account (can be found online) and i think he is still going after years and years...no clue how much money he got.
 
Commodity Fund managers use to charge 3-6% management fee a year plus the 20% of new profits, bet they made more on the guaranteed than the 20%. Back in the day when interest rates was 6-10%, the guaranteed didn't touch the principle and many would only risk very small amounts to not cause huge drawdowns, but in todays' world....
 
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