Poll: Harder making $$$ daytrading at a prop firm year over year 2001-2006?

[seasonedpro]

I PMed you what I thought Old School, but will voice my opinion here as well. It is most definitely harder to make money now. I started in 97 and know people (managers, traders, and owners) in many prop shops and the business is no where near what it used to be. I personally know of only a handful of my peers who are still trading prop.

With a few exceptions, the best guys aren't making anywhere near what they did and the number of guys making money isn't nearly as great. I know some of the newer traders who are making money will discredit this, but it is true.

In 2001 the devastating effects of decimalization hadn't been fully realized and even more devastating is the proliferation of automated / algorithmic trading. Electronic trading killed the floor broker and automated will kill the human electronic traders. The moves these days are nonexistent.

I had to laugh when someone on another thread was commenting on how rowdy the trading in EFUT was that day, spreads were a jaw gapping .20 wide. That was the spread in AMAT back in 2000. The spread in the rowdies back in the day were routinely over $2 wide. You used to have to lock orders up by that much just to get stock.

I think it maybe has gotten a little better over the past 6 months but anyone who tells you it is easier doesn't know what it was really like or is denial.

That said it is still the best job going if you can find an edge. I managed to stay in the game as long as I did because I always kept a healthy amount of fear and was disciplined enough to keep tight stops and avoid doubling on losers. But after years of chop my discipline finally broke down along with my account.

Best of Luck to everyone still in the trenches.


SP

 

[seasonedpro]

I wonder how many in the poll actually were trading in 2001? I bet over half of the responses are made by people who think they know what it was like back then. You don't see too many "veterans" around ET anymore.

 

[austinp]

<b>seasonedpro</b>, I traded thru early 2000 ~ early 2003, which in my opinion was the most glorious time for short-term traders ever seen.

Most of today's traders think a 10pt ES range or 30pt NQ range is something to behold. It may be... for now. Complacency is high, volatility is t.k.o'd on the mat and nothing but blue sky upside is the forecast forever.

Hmm... sounds to me a lot like early 2000 mantra. Valuations today may be low, but what are earnings based on? Solid, robust organic growth of companies? Or out-sourcing, cost-cutting and belt-tightening to manipulate data outside of the commodity stock industry?

*

How many of today's active traders worked thru an NQ session where the intraday pit-session range spanned 603 index points from high to low and back to high? How many recall a -1100 index point drop in five trading sessions?

The game continues to evolve, but history tends to repeat itself. There may come a period of time where volatility and ranges become somewhat wild again, should all of the tightly arb'd indexes get pressed real hard in a correction.

Harder to make money today than during 1999 - 2003? Absolutely. A lot more opportunity then, but still a very prime living to be made in correct symbols these days.

 

[Mr B]

bloody good question.

in 02 the bund was an easy trade.
then the order book went crazy and you couldn't read it, so I switched to systematic technical trading.
then the ECB went into a lull and fixed income wasn't volatilie enough in the euro area.
so I went over to US treasuries.
then as the quants took over I got introduced to the black box style, so now I'm working on that.

when the market changes I change my style and/or products, it's more of a challenge and more interesting - it never gets easier, but I am making more money.

 

[Old School]

Thanks to the fifty people who voted.

To those suffering:
I feel your pains - there is life after trading though.

To those in the middle:
Congrats, you're the survivors.

To those doing well:
Cough it up! What are you doing?

Jokes aside, thank you all for you participation.

 

[Old School]

I'd like to ask the 19 people so far thinking of quitting...

What do you think is the #1 reason that you're having such a hard time these days?

Is it you? (personal issues, burnt out, etc..) or
Is it the market that has changed and made your setups no longer profitable? or
Somethingelse?

I'm not trying to make anyone more depressed thinking about their situation, rather, I am hoping that perhaps we can all learn from it.

"My best lessons came from my failures, not my successes"

 

[traderpro]

2001-2006. There is money out there. Alot tougher now but it can be done. The trick is to be consistant not up 10k one day then down 20k the next. Back in 1999 JPHQ would take my isld offer through and it was easy money that is done. Now no fyi's and it is much more competitive. I had to stop watching the level II so much and just use the chart. In 1997-2000 i didn't even need a chart now it is very different. You can still make money, crazy money like 99 not here since. Last 2 years the close have not been good for me. I trade and make my money in the am. A friend of mine has a floppy disk 2 hrs of trading from back then. I look and i hope it comes back.

 

[SizesTrader]

It is certainly harder to make money nowadays. You have to be very patience and selective to be profitable in this market.

I've been trading for a long time and I know that if you don't adapt to this market, you will not succeed for long. I've learned to adapt to this market fairly well. This year has been one of my best years.

You just need to work harder and try to find ways to adjust. It's about discipline.

Good luck to all.

 

[Bitstream]

Quote from traderpro:

2001-2006. There is money out there. Alot tougher now but it can be done. The trick is to be consistant not up 10k one day then down 20k the next. Back in 1999 JPHQ would take my isld offer through and it was easy money that is done. Now no fyi's and it is much more competitive. I had to stop watching the level II so much and just use the chart. In 1997-2000 i didn't even need a chart now it is very different. You can still make money, crazy money like 99 not here since. Last 2 years the close have not been good for me. I trade and make my money in the am. A friend of mine has a floppy disk 2 hrs of trading from back then. I look and i hope it comes back.

it's just the past couple of yrs that have been very tough, '04 was free money in many respect and all those edges i had back them have almost disappeared.

 

[limitdown]

most traders I have known have left for more stable times,

I was at a conference and one of the Bloomberg Products salesmen used to be a trader also. He left for the reliable paycheck.

The effect of the PDT rule has chased out small money from participating in a a meaningful way, hence the game has changed to the large guys (institutions) chowing down on the smaller players through all their manipulations of the charts.

A few firms continue, but they too, keep churning through their new traders at an even faster clip. Those fortunate enough to remain leveraged did so through no skill of their own, just circumstantial good fortune. Left a lot of good guys Vegas at the trading desks.

Some say things have changed for the better with smoother trading curves and patterns because of the elimination of just so many smaller traders. But in that short conversation, they were the rare survivors and even felt alone, too.

So, find the vehicles that trade according to your style and temperment and that should help tremendously.

Cheers