Didn't read the whole thread...Today 32 pages. Just wondering if you have a balanced outside life? Walk the dog, dinner with the wife, Frisbee golf? 40-50 hours in the corporate life + day trading on the side...Could this lead to an early heart attack? Just asking...You know your limits. The new corporate life will add stress. You'll need to prove your worth (extra hours). Bird in the hand (corporate life and benefits)...Two in the bush...Day trading full time (no benefits...maybe great profits...Maybe a blown up large trade). The problem with corporate life (unless you can negotiate more early vacation time) you start from square one. You may get one or two weeks vacation after putting in one year. It will be one long hard year. After that the vacation (and sick days) build up...More freedom and relaxation. But that can take years. A lot comes into play depending how good your wife's medical (dental, eye) benefits are? Your call...Choose wisely
Need Advice
- Thread starter trader99
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You do have some good points. Everything has their pros and cons.
If I go back to corporate, then I wouldn't be daytrading full time right? I would probably have at most 1-1.5 hrs in the morning for daytrading then head to work for a full 40hrs+ week.
I know you haven't read the entire thread, but I have a young daughter to take care of. My wife passed away(long story) just shortly after I started this thread. I do have a life outside of work and daytrading. LOL. I have family and friends that I hang out on the weekends.
New corporate life? I've been working in Corporate America for many years in case you haven't figured it out. This is not my first rodeo at a Corporate job. lol. Usually you get 2 weeks vacation which accrues over the year. And you get 3 weeks after working for 5 years. In contrast to daytrading in which you can take time off whenever you want. This assumes your daytrading is net positive and enough to support you.
Perhaps there is a middle ground. Currently, I'm doing side consulting and trading a few days a week. The side consulting provides some stability. And if I can turn my daytrading around then this would be the ideal arrangement! Work at client site a few days a week. And the rest of the week is my own time. This arrangement only works if my daytrading is decently net positive as I've written previously.
So, that's why I'm really pushing to turn my daytrading to turn around. I think I'm in an ideal middle ground situation now. If I can help it then I rather not going back to corporate life. I love the freedom I get from not working 40 hrs a week in the office.
But that would only make sense if my daytrading or swing trading is sufficiently good..
if not then my stop loss is going back to Corporate work full-time...
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Sorry for your loss. I was a farmer (almonds), Realtor, and had (have) rentals. Fair income (assets) but no benefits. I sold the farm, dropped being a Realtor (hated to network). The last 10 years before retiring I was a security guard!! Yes, I had net assets over $1,000,000. but very little income. By being a member of the union, I only had to work an average of 24 hours a week per month. They took out for the union dues...I was making only about $10. an hour. I would have stayed if they were paying me $1. an hour...I kid you not. At the time my wife had her own insurance. I couldn't get on hers. I only had major medical (in the hospital). My group plan were farmers from 55 to 64 years of age...Not the ideal group to insure. Was paying over $20,000. myself for my policy...No doctor visits covered, no medications!! I used the union's benefits to the max!! It was crappy coverage. But I had about $600. a month in prescription alone, was able to see doctors, specialist...Before Obamacare. Used the dental ($1,000. per year) and put the max in the 401K matching.
Just talking out loud here. Could you find the company with a flex plan? That provided the medical (or you share the cost) and allows for 25-30 hour weeks. Not to be sexist, but we use to call this "the mommy track" years ago... It is hard to move up the corporate ladder, but it may be a way for you, till your daughter starts rolling her eyes at you and telling you how totally out of it you are...
Just talking out loud here. Could you find the company with a flex plan? That provided the medical (or you share the cost) and allows for 25-30 hour weeks. Not to be sexist, but we use to call this "the mommy track" years ago... It is hard to move up the corporate ladder, but it may be a way for you, till your daughter starts rolling her eyes at you and telling you how totally out of it you are...
Thank you for your kind words. There were some really dark days/months in the beginning. The pain is still there though less now as I focus my energy on raising my young daughter.
We are in different life stages. I'm still a working professional with probably a few more decades until retirement. So a long way to go.
I do technology consulting. It pays pretty decent. I have recruiters call me everyday since my area is hot and i have great credentials. So, it shouldn't be too difficult to get a full-time Corporate job again.
But currently, I'm doing PART-TIME technology consulting so I can give my business idea a try and have more flexibility with taking care of my 5 year old. And on the side I've been daytrading to piggyback everything I have going on.
The reason I like consulting for now is what you called the "mommy track." It has a lot of flexibility. I can either do consulting full-time or do Corporate job full-time. Both options are available for me.
As to benefits, I buy it through the marketplace. It's not too bad in terms of prices.
So, financially I'm OK for a while. But I still feel like I need a stop-loss on daytrading.
That's why I say September. I've spend countless hours on this stuff. I've made progress but also had big setbacks which wiped out my progress.
I feel frustrated at the progress or lack there of. Given all the hours I spent on it I feel like I should be further along. Perhaps, daytrading is not playing to my natural strengths.
Sometimes I wished I never had known about daytrading. There are MUCH EASIER ways to make money! Why am I obsessed with making money through trading? There are tons of other jobs and skillsets I have that can generate good stable income.
Anyhow, I'm at a crossroad. I don't want to waste any more time and money on this if this is not a fruitful enterprise...
So come September, if there's no progress with daytrading, then I'll switch over to full-time consulting or full-time Corporate job.
Another net positive day for both accounts. Not much but it's going in the right direction. I went both long and short.
I remember years ago when I first started daytrading(during the bear market), I would buy the dip too early. On days like yesterday and today I would be totally destroyed. Now I timed it slightly better and bought the dip and short when needed. Got out quickly when I'm wrong. Now, both days I'm up positive. Not huge. Just 1 lots. But gotta practice the right habits first.
And it's not just during bear markets. If you buy the dip too early then you will get shaken out. If you short the rally too early then you will get shaken out. It's best to go with the trend. Then reverse when higher highs, higher lows show up. And vice versa.
So, that's slowly undoing one bad habit.
The other bad habit was shorting rallies. So yesterday during the morning I used to get wiped out. Now I joined in on the rallies. Not perfect since I shorted then got wrong then joined in.
Today I used stops and kept my losses small and manageable.
There are still a few things I know intellectually what do but can't execute due to my bad habits. A few more tweaking and constant reinforcement to cement in good habits.
I'll keep you guys updated
You said: For those who trades NQs, how do you exit quickly? I'm a point and click guy(yeah, I know slow). By the time I see it and decide to get out prices have moved and spike up(when I'm sort). Thus not being able to realized my gains even though I was right with the direction.
I'm thinking...Does he have stop losses in place? Flash crash? I am reading this thread from the start...Very interesting. It's like a novel!! I can't wait till the first week of February!! What happens if no stop loss and a finger for a trigger?? Be interesting (scared to death) if the power went out?? Stop loss YES??
One last thing and then I am out. I remember the "Flash Crash" of 1987. There were NO markets for shorts. There were no markets!! Bid/ask on some stocks/options went away for a few hours. Just keep this in mind as you work your system. Below is from Wiki...
Black Monday (1987)
From Wikipedia, the free encyclopedia
Jump to: navigation, search
FTSE 100 Index (June 19, 1987, to January 19, 1988).
DJIA (June 19, 1987, to January 19, 1988).
In finance, Black Monday refers to Monday, October 19, 1987, when stock markets around the world crashed, shedding a huge value in a very short time. The crash began in Hong Kong and spread west to Europe, hitting the United States after other markets had already declined by a significant margin. The Dow Jones Industrial Average (DJIA) fell exactly 508 points to 1,738.74 (22.61%).[1] In Australia and New Zealand, the 1987 crash is also referred to as "Black Tuesday" because of the time zone difference.
The terms Black Monday and Black Tuesday are also respectively applied to October 28 and October 29, 1929, which occurred after Black Thursday on October 24, which started the Stock Market Crash of 1929.
Contents
[1 Timeline
Timeline[edit]
Timeline compiled by the Federal Reserve.
In late 1985 and early 1986, the United States economy shifted from a rapid recovery from the early 1980s recession to a slower expansion, resulting in a brief "soft landing" period as the economy slowed and inflation dropped. The stock market advanced significantly, with the Dow peaking in August 1987 at 2,722 points, or 44% over the previous year's closing of 1,895 points. Further financial uncertainty may have resulted from the collapse of OPEC in early 1986, which led to a crude oil price decrease of more than 50% by mid-1986.[2]
On October 14, the DJIA dropped 95.46 points (3.8%) (a then record) to 2,412.70, and fell another 58 points (2.4%) the next day, down over 12% from the August 25 all-time high.
On Thursday, October 15, 1987, Iran hit the American-owned (and Liberian-flagged) supertanker, the Sungari, with a Silkworm missile off Kuwait's main Mina Al Ahmadi oil port. The next morning, Iran hit another ship, the U.S.-flagged MV Sea Isle City, with another Silkworm missile.
On Friday, October 16, when all the markets in London were unexpectedly closed due to the Great Storm of 1987, the DJIA fell 108.35 points (4.6%) to close at 2,246.74 on record volume. Then-Treasury Secretary James Baker stated concerns about the falling prices.
The crash began in Far Eastern markets the morning of October 19, but accelerated in London time—largely because London had closed early on October 16 due to the storm—by 9.30am the London FTSE100 had fallen over 136 points. Later that morning, two U.S. warships shelled an Iranian oil platform in the Persian Gulf in response to Iran's Silkworm missile attack on the Sea Isle City.[3][4]
Market effects[edit]
By the end of October, stock markets had fallen in Hong Kong (45.5%), Australia (41.8%), Spain (31%), the United Kingdom (26.45%), the United States (22.68%) and Canada (22.5%). New Zealand's market was hit especially hard, falling about 60% from its 1987 peak, and taking several years to recover.[5][6] The damage to the New Zealand economy was compounded by high exchange rates and the Reserve Bank of New Zealand's refusal to loosen monetary policy in response to the crisis, in contrast to countries such as West Germany, Japan and the United States, whose banks increased short-term liquidity to forestall recession and experienced economic growth in the following 2–3 years.[7]
The Black Monday decline was—and currently remains—the largest one-day percentage decline in the DJIA. (Saturday, December 12, 1914, is sometimes erroneously cited as the largest one-day percentage decline of the DJIA. In reality, the ostensible decline of 24.39% was created retroactively by a redefinition of the DJIA in 1916.[8][9])
Following the stock market crash, a group of 33 eminent economists from various nations met in Washington, D.C. in December 1987, and collectively predicted that "the next few years could be the most troubled since the 1930s".[10] However, the economy was barely affected and growth actually increased throughout 1987 and 1988, with the DJIA regaining its pre-crash closing high of 2,722 points in early 1989.
Causes[edit]
Possible causes for the decline included program trading, overvaluation, illiquidity and market psychology.
A popular explanation for the 1987 crash was computerized selling dictated by portfolio insurance hedges.[11] However, economist Dean Furbush pointed out that the biggest price drops occurred during light trading volume.[12] In program trading, computers execute rapid stock trades based on external inputs, such as the price of related securities. Common strategies implemented by program trading involve an attempt to engage in arbitrage and portfolio insurance strategies. As computer technology became widespread, program trading grew dramatically within Wall Street firms. After the crash, many blamed program trading strategies for blindly selling stocks as markets fell, exacerbating the decline. Some economists theorized the speculative boom leading up to October was caused by program trading, and that the crash was merely a return to normalcy. Either way, program trading ended up taking the majority of the blame in the public eye for the 1987 stock market crash. U.S. Congressman Edward J. Markey, who had been warning about the possibility of a crash, stated that "Program trading was the principal cause."[13]
New York University's Richard Sylla divides the causes into macroeconomic and internal reasons. Macroeconomic causes included international disputes about foreign exchange and interest rates, and fears about inflation.
The internal reasons included innovations with index futures and portfolio insurance. I've seen accounts that maybe roughly half the trading on that day was a small number of institutions with portfolio insurance. Big guys were dumping their stock. Also, the futures market in Chicago was even lower than the stock market, and people tried to arbitrage that. The proper strategy was to buy futures in Chicago and sell in the New York cash market. It made it hard – the portfolio insurance people were also trying to sell their stock at the same time.[14]
Regulation[edit]
After Black Monday, regulators overhauled trade-clearing protocols to bring uniformity to all prominent market products. They also developed new rules, known as "trading curbs" or colloquially as circuit breakers, allowing exchanges to temporarily halt trading in instances of exceptionally large price declines in some indexes; for instance, the DJIA.[15
Black Monday (1987)
From Wikipedia, the free encyclopedia
Jump to: navigation, search
FTSE 100 Index (June 19, 1987, to January 19, 1988).
DJIA (June 19, 1987, to January 19, 1988).
In finance, Black Monday refers to Monday, October 19, 1987, when stock markets around the world crashed, shedding a huge value in a very short time. The crash began in Hong Kong and spread west to Europe, hitting the United States after other markets had already declined by a significant margin. The Dow Jones Industrial Average (DJIA) fell exactly 508 points to 1,738.74 (22.61%).[1] In Australia and New Zealand, the 1987 crash is also referred to as "Black Tuesday" because of the time zone difference.
The terms Black Monday and Black Tuesday are also respectively applied to October 28 and October 29, 1929, which occurred after Black Thursday on October 24, which started the Stock Market Crash of 1929.
Contents
[1 Timeline
Timeline[edit]
Timeline compiled by the Federal Reserve.
In late 1985 and early 1986, the United States economy shifted from a rapid recovery from the early 1980s recession to a slower expansion, resulting in a brief "soft landing" period as the economy slowed and inflation dropped. The stock market advanced significantly, with the Dow peaking in August 1987 at 2,722 points, or 44% over the previous year's closing of 1,895 points. Further financial uncertainty may have resulted from the collapse of OPEC in early 1986, which led to a crude oil price decrease of more than 50% by mid-1986.[2]
On October 14, the DJIA dropped 95.46 points (3.8%) (a then record) to 2,412.70, and fell another 58 points (2.4%) the next day, down over 12% from the August 25 all-time high.
On Thursday, October 15, 1987, Iran hit the American-owned (and Liberian-flagged) supertanker, the Sungari, with a Silkworm missile off Kuwait's main Mina Al Ahmadi oil port. The next morning, Iran hit another ship, the U.S.-flagged MV Sea Isle City, with another Silkworm missile.
On Friday, October 16, when all the markets in London were unexpectedly closed due to the Great Storm of 1987, the DJIA fell 108.35 points (4.6%) to close at 2,246.74 on record volume. Then-Treasury Secretary James Baker stated concerns about the falling prices.
The crash began in Far Eastern markets the morning of October 19, but accelerated in London time—largely because London had closed early on October 16 due to the storm—by 9.30am the London FTSE100 had fallen over 136 points. Later that morning, two U.S. warships shelled an Iranian oil platform in the Persian Gulf in response to Iran's Silkworm missile attack on the Sea Isle City.[3][4]
Market effects[edit]
By the end of October, stock markets had fallen in Hong Kong (45.5%), Australia (41.8%), Spain (31%), the United Kingdom (26.45%), the United States (22.68%) and Canada (22.5%). New Zealand's market was hit especially hard, falling about 60% from its 1987 peak, and taking several years to recover.[5][6] The damage to the New Zealand economy was compounded by high exchange rates and the Reserve Bank of New Zealand's refusal to loosen monetary policy in response to the crisis, in contrast to countries such as West Germany, Japan and the United States, whose banks increased short-term liquidity to forestall recession and experienced economic growth in the following 2–3 years.[7]
The Black Monday decline was—and currently remains—the largest one-day percentage decline in the DJIA. (Saturday, December 12, 1914, is sometimes erroneously cited as the largest one-day percentage decline of the DJIA. In reality, the ostensible decline of 24.39% was created retroactively by a redefinition of the DJIA in 1916.[8][9])
Following the stock market crash, a group of 33 eminent economists from various nations met in Washington, D.C. in December 1987, and collectively predicted that "the next few years could be the most troubled since the 1930s".[10] However, the economy was barely affected and growth actually increased throughout 1987 and 1988, with the DJIA regaining its pre-crash closing high of 2,722 points in early 1989.
Causes[edit]
Possible causes for the decline included program trading, overvaluation, illiquidity and market psychology.
A popular explanation for the 1987 crash was computerized selling dictated by portfolio insurance hedges.[11] However, economist Dean Furbush pointed out that the biggest price drops occurred during light trading volume.[12] In program trading, computers execute rapid stock trades based on external inputs, such as the price of related securities. Common strategies implemented by program trading involve an attempt to engage in arbitrage and portfolio insurance strategies. As computer technology became widespread, program trading grew dramatically within Wall Street firms. After the crash, many blamed program trading strategies for blindly selling stocks as markets fell, exacerbating the decline. Some economists theorized the speculative boom leading up to October was caused by program trading, and that the crash was merely a return to normalcy. Either way, program trading ended up taking the majority of the blame in the public eye for the 1987 stock market crash. U.S. Congressman Edward J. Markey, who had been warning about the possibility of a crash, stated that "Program trading was the principal cause."[13]
New York University's Richard Sylla divides the causes into macroeconomic and internal reasons. Macroeconomic causes included international disputes about foreign exchange and interest rates, and fears about inflation.
The internal reasons included innovations with index futures and portfolio insurance. I've seen accounts that maybe roughly half the trading on that day was a small number of institutions with portfolio insurance. Big guys were dumping their stock. Also, the futures market in Chicago was even lower than the stock market, and people tried to arbitrage that. The proper strategy was to buy futures in Chicago and sell in the New York cash market. It made it hard – the portfolio insurance people were also trying to sell their stock at the same time.[14]
Regulation[edit]
After Black Monday, regulators overhauled trade-clearing protocols to bring uniformity to all prominent market products. They also developed new rules, known as "trading curbs" or colloquially as circuit breakers, allowing exchanges to temporarily halt trading in instances of exceptionally large price declines in some indexes; for instance, the DJIA.[15
From above...I was wrong, there were bid and ask during that crash. When the SEC put in circuit breakers, the market will stop and reset...Up to them when they reopen. Also 9/11 had a major effect on markets...
The opening of the New York Stock Exchange (NYSE) was delayed after the first plane crashed into the World Trade Center's North Tower, and trading for the day was canceled after the second plane crashed into the South Tower. NASDAQ also canceled trading. The New York Stock Exchange was then evacuated as well as nearly all banks and financial institutions on Wall Street and in many cities across the country. The London Stock Exchange and other stock exchanges around the world were also closed down and evacuated in fear of follow-up terrorist attacks. The New York Stock Exchange remained closed until the following Monday.
The opening of the New York Stock Exchange (NYSE) was delayed after the first plane crashed into the World Trade Center's North Tower, and trading for the day was canceled after the second plane crashed into the South Tower. NASDAQ also canceled trading. The New York Stock Exchange was then evacuated as well as nearly all banks and financial institutions on Wall Street and in many cities across the country. The London Stock Exchange and other stock exchanges around the world were also closed down and evacuated in fear of follow-up terrorist attacks. The New York Stock Exchange remained closed until the following Monday.
The last couple of days I've been chopped up on YM. When I short I get stopped out then it goes my way. When I'm long I get stopped out then it goes my way.
So, now I've been just observing. My stops are probably too tight and I can refine the entry just a tad more.
Gotta go to work in 30mins. hehe
Last night I did manage to finish writing some code to analyze my trade records. Performance analytics. I actually enjoy doing that.
So I think the next logical step for me is to start building systems. This discretionary daytrading is NOT working out. Sure, I have had good days. But net net it has not been an economically or emotionally positive experience.
Gotta be honest and RATIONAL. I think my time will be better spent coding up systems that don't have emotions and all sorts of biases. Just let it trade what I ideally would behave.
It's harder to change our behavior to behave our optimal best self everyday. But machines will behave our best self all the time..
So, now I've been just observing. My stops are probably too tight and I can refine the entry just a tad more.
Gotta go to work in 30mins. hehe
Last night I did manage to finish writing some code to analyze my trade records. Performance analytics. I actually enjoy doing that.
So I think the next logical step for me is to start building systems. This discretionary daytrading is NOT working out. Sure, I have had good days. But net net it has not been an economically or emotionally positive experience.
Gotta be honest and RATIONAL. I think my time will be better spent coding up systems that don't have emotions and all sorts of biases. Just let it trade what I ideally would behave.
It's harder to change our behavior to behave our optimal best self everyday. But machines will behave our best self all the time..