My Stock Trading Ups and Downs

H

Hot_Wings

This thread will chronicle my stock trading experience from day one - day unknown.

My Plan:

I plan to day/swing trade stocks during the week and work my crappy security job on the weekends. I will be able to trade stocks Tuesday through Friday most weeks. I will only trade stocks when I will be able to watch them all day long.

I don't have enough money to open a day trading account and at first I will not be using margin, so, I will have to wait a week before I will be able to trade again with cleared funds from my small cash account. Sucks, but I am still learning the basics of all this and until I can put more money in the account it’s going to have to be a cash account for now. I will be putting $800-$1000 a month into this account from my job but of course that will take some time and right now I only have $500 in my account.

My Story:

Three months ago I moved back in with my parents without a penny to my name. I have practically no assets whatsoever. Previous to that, I was a graphic designer at a newspaper in Florida. The job didn't pay well and I used up my meager savings buying stupid things because I thought that I had it made in a career field that I liked. Then 4 ½ months later I was about to be laid off after the company fired two other employees just to save some money. The newspaper was 80,000 dollars short on the budget the month that they fired the other people. I knew the writing was on the wall so I took the money that was in my pocket and I called my folks and told them what was going on. They let me move back in and now I work a crappy job as a security guard in a factory close to the folks place.

However, the wheels started turning in my head that I might be able to turn things around for me if I used this misfortune the best that I could. So, I talked things over with my folks and they gave me the go ahead to give it one last try with stocks for a few months and see how it goes. I used to go to college for accounting before I got the graphic design job and it was then that I traded a few times in a cash account. It was just small stuff to get a feel for things, but this time, I am putting all my savings and extra time into learning to trade stocks.

Trading books:

These are the trading books that I have purchased and I have read 4-5 chapters of each of them expect the Short Selling book and only 2 chapters of the CNBC 24/7 trading book. I will post more later about what I have learned from these books.

The Art of short Selling by Kathryn Staley
The Complete Day Trader, by Jake Bernstein
How to get started in Electronic Day Trading, by David Nassar
Electronic Day Trading to Win, By Bob Baird and Craig McBurney
Electronic Swing Trading for Maximum Profit, by Misha T. Sarkovich
CNBC 24/7 Trading, by Barbara Rockefeller
Real Money, Sane Investing, by Jim Cramer

I have also read about half of The Wealth of Nations by Adam Smith and I fully recommend reading it for people who still have the time. It is a trying read make no mistake about it. However, I feel that only the classic texts on finance and economics explain matters so poignantly and clearly as to be understood by the lay person completely. I obviously plan to read many blogs and posts from others as well, but sadly, I haven’t found hardly any that discuss someone else’s experience with trading. Mostly all I find are posts from people saying “Buy this Now!” and garbage like that. I want to get to talk with other Day Traders and Swing Traders but I am finding that not many people who actually post at sites like these are people who even trade or watch the market on a serious level. I am finding that most of the people on these forums (prove me wrong please) are kids who simply gamble away mommy and daddy’s money with no attempt whatsoever to educate themselves about trading.

My Money:

Jim Cramer has said that you need a minimum of 10,000 dollars in order to trade stocks. Well, I am going to only have about 2000 dollars to start making actual trades with. Yes, this is all the savings that I have and I will be using all of it for everyday for almost every trade that I make. Call me foolish if you want to, but I have done the calculations and I know that in order to make any money at this then I need to put all my eggs in one basket for a while. I just have to be very careful what basket that is and be ready to move my eggs in a flash. I have traded before in an online account but I only made 3 trades. This time, it will be my second job. I have opened an account with only 500 dollars right now and I will keep studying and reading the books and watching the screens to learn from until I can get at least $1500 in the account (hopefully just another month away from now). I plan on adding $800-$1000 a month to my stock trading account. I am only able to do this because I am living again back with my folks. Otherwise, my crappy security job would barely pay my bills. I have kept my expenses to a minimum and I ride a motorcycle as my transportation. The insurance is only 250 a year (yes that's year) and the payments are only 150 a month. It also gets about 45 miles to the gallon so it’s cheap all around. My parents are feeding me so basically all my extra money is going to this attempt at stock trading.

I pray that it goes well.

Thanks, I hope that my posts in this thread will help you and me.
 
I suggest reading, learning and saving more. Also, check of the following books:

Mastering the Trade

Come Into My Trading Room

TA for Dummies

Just for starters.

Also, I would save a little more before starting. For me, the $2000 would limit my options assuming you mean equites and you are more inclined to loose it all sooner than later.

Also, if you are pre-occupied with issues outside of Trading..., this may influence your decision making and trading.
 
Quote from Hot_Wings:

Trading books:

These are the trading books that I have purchased and I have read 4-5 chapters of each of them expect the Short Selling book and only 2 chapters of the CNBC 24/7 trading book. I will post more later about what I have learned from these books.

The Art of short Selling by Kathryn Staley
The Complete Day Trader, by Jake Bernstein
How to get started in Electronic Day Trading, by David Nassar
Electronic Day Trading to Win, By Bob Baird and Craig McBurney
Electronic Swing Trading for Maximum Profit, by Misha T. Sarkovich
CNBC 24/7 Trading, by Barbara Rockefeller
Real Money, Sane Investing, by Jim Cramer

I have also read about half of The Wealth of Nations by Adam Smith and I fully recommend reading it for people who still have the time. It is a trying read make no mistake about it. However, I feel that only the classic texts on finance and economics explain matters so poignantly and clearly as to be understood by the lay person completely.
More...

great books
 
So, I was reading your post and it sounds vaguely familiar to a situation that I was in a few years back. First of all, if you are serious about "trading" you can't really do it successfully from etrade, ameritrade, scotttrade, etc.. there are plenty of proprietary firms where you can try to start a career as a trader, and trade with firm capital, instead of your own. The reason I suggest this is because commissions are crippling when trading from one of these platforms and you have to be very efficient. When trying to day trade on these platforms to catch enough of an interday move to make up for not only the slippage but the commissions. No book you read, is going to teach you the things neccesary to flourish as a "trader" on these platforms. Depending on your geographical location and recent job loss this may be an easy transition for you. Of course there is testing involved 7,63,55 but if you cant pass those, you probably better off investing for the long term anyways. Books that gave me a good perspective of trading were Reminiscenses of a Stock Operator and New Market Wizards both are classics and are a little more relevant than Wealth of Nations.
 
i feel your pain you should check out my thread: 60,000 down the drain.

This book has helped me tremendously

Stock investing for dummies by Paul J. Mladjenovic
 
You might profit from reading How I Made $2,000,000 In The Stock Market by Nicolas Darvas. I once asked William O'Neil what were the best books on the stock market. He replied "there aren't many". I asked what is the best book and he replied---"that one by Darvas", he also suggested Loeb's book.

Darvas2
 
i'd finish the accounting degree, but im conservative. the market will be here in 2-4 years... as you get older, your options can really narrow, so i'd get a fall-back first. worst case under my scenario is you fail as a trader, but can fall back on a career as an accountant. also, as an accountant, you can probably hire out as an idependent contractor during tax season and trade other times. if you insist on trading while at school, you can perhaps focus on opening gaps.
 
Dear Hot Wings,

I read over your posting again and have some further thoughts. First off, forget prayer. It is usless in the markets. Martin Schwartz has a great quote about prayer in his book entitled Pit Bull. Suggest you read this book. The quote is on p. 122-123.

Don't be in such a rush. The market was there before you were born and it will be there after you die. Forget about making money, learn to trade first and the money will follow.

Reading is useful and most traders accumulate a lot of trading books because they are passionate about the subject. William O'Neil told me he had around 3,000 trading related books etc. in his library. But books will not solve the problems.

Keeping a journal of every trade you do is more helpful. I went to an art supply store and bought a large (14 x 11") sprial bound sketch book. When I trade I print out the charts at the time of the trade, I also print out the confirmation. I then tape these in the book and write my notes as to why I took the trade. When I exit the trade I do the same thing. I then calculate dollar and percentage value profit or loss. I then look for the next trade.

The above way of working really helps because as time passes one looks at their previous reasons why one got into a trade and cringes---How could I have been so stupid! (This is not always with a losing trade but also a trade that made money!)

As you trade, you will have to figure out what works for you. It is like learning to paint. Someone can show you the basics, but you will form your own style. Trading is really between your ears.

Hope that helps.

Sincerely,
Darvas2

PS I have Martin Schwartz's quote pasted on the front of my trading journals just to keep me on the right track.
 
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