Poll : How many years needed to learn day trading ?

[Stymie]

I don't think the right question is how many years experience is needed to be a profitable day trader. The more important question is what skill sets are needed to be successful.

Most people will agree that the markets are random and cannot be predicted. Most people agree that the casino has the edge and you cannot beat the house. But there are people who can consistently beat the casino and they end up on a blacklist so they can't go to any casino in the world. So there must be people who can beat the market but in this case they don't get banned from trading in the markets because they are profitable.

Key skill sets to learn:

1. Logical risk reward business plan - returns need to make sense relative to risk and costs.
2. Money management - need to understand law of averages and number of occurrences.
3. Blind spots - this becomes bigger issue as you get older. How your emotions will cloud judgement based on earlier experiences. Even if you understand them, you can't control.
4. Research - history repeats itself even if the timing is unpredictable. Read Wall Street Journal from 1880's onward. (Microfiche).
5. Time - the key is allowing the probability of success to increase. Read Stephen Hawking "A brief history of time".

Then the question becomes when will the markets accommodate your strategy so that compounding profits reach a level that you define as success. Time will determine this - not experience. For myself, it's was one year and then it happened again only ten years later.
Enjoy the ride and keep reducing cost basis while you wait.

 

[rajesheck]

The more important question is what skill sets are needed to be successful.

Very True

What is the task at hand ?

What kind of skill is needed to accomplish that task ?


There is a management quote which says...

"Use things and manage people.
Don't use people and manage things."


Manage Vs Use

Managing means "When people are involved manage the situation with common sense and basic human psychology."

Using means "When just things are involved use them with logic and analysis."


Market involves people not just a set of machines.

"Use" the trading software with basic computer and logical skills.

"Manage" the trading by reading the chart or data with common sense and basic psychological skills.


Do Not

Don't "use" charts or data to trade with analytical skills.

The charts and data represent the heart beat of the market. Market means people, not machines. Trading chart is the national anthem for the trading nation. Genuine traders are patriots of this trading nation and respect charts and manage trading with common sense and psychological skills.


Makes sense, right?


Those who are still in "learning curve" even after 5 years are most probably mismatching the skills.

However if they are enjoying swimming with bicycling skill, then let them continue to enjoy the learning curve for another decade.

But please don't come and tell us that trading needs more than 20 years to learn. Enjoy your drug (analysis paralysis) addiction, don't expect everyone to do the same.

(99.99% of the trading community will not like this post . All drug addicts pouring money into market so generously and do not like anyone to question their legacy.)

 

[rajesheck]

I don't think the right question is how many years experience is needed to be a profitable day trader.

This poll is about learning curve, with an assumption that the curve completes with the ability to trade consistently without losing money. Becoming a profitable trader may take some more time after the learning curve.

Your point about skill is very valid. We need to apply appropriate skills for respective tasks. Mismatch of skill wont work.

This poll gives people a clue of whether they are developing appropriate skills for trading or not. People who are clueless about the right skills are the ones taking more than 5 years. Around 40% of traders are within the 5 years mark.

So majority of the traders are wandering with their existing analytical skills and reluctant to learn to see trading as a psychological skill.

 

[m1nt]

It took a few months to become profitable and very consistent BITD. That was pre-2005, though. I have since spent years casually looking to see if there is an edge in day trading in stocks (or forex or whatever).

I would not want to do it as a career choice.

That said, I do not deny that people might successfully do this without being fully automated and not having some sort of order flow edge. I do not know any professional hockey players either, but they exist.

Good luck, dude.

 

[rajesheck]

Most people will agree that the markets are random and cannot be predicted.

Market is not random. Market is mass psychology. Psychology is not random. Psychology is an art.

Practical speaking, market is either trending or stuck up somewhere for some time. Whats so complex about it?

Skillful trading is all about knowing when to trade, when not to trade, how to trade safely without losing much money, how to make maximum profits, etc.

Most people agree that the casino has the edge and you cannot beat the house. But there are people who can consistently beat the casino and they end up on a blacklist so they can't go to any casino in the world. So there must be people who can beat the market but in this case they don't get banned from trading in the markets because they are profitable.

Good point

Traders, businessmen and professional gambler who are successful in their respective professions have one common thing in them. Business mindset.

I claim that business or gambling is not outside, it is right inside your mind.

There are many people who gambled with their business and lost money. I call them gamblers though they are not in gambling business.

And there are gamblers who sensibly make money. I call them businessmen though they are in legitimate business.

Trading/business is a 3 dimensional psychological game.
1. Mass psychology
2. Trading/business philosophy
3. Personal psychology

However people with clear insights/intuitions are ready to pursue this business psychology successfully. Others bring in their pride of success in non-business areas and expect the same kind of success here in trading.

I know some businessmen who are success in the respective business lost money in trading/investment. Even good businessmen tend to gamble with stock market.

So it is QUITE NATURAL for common people who make the majority of the trading mass to underestimate or misinterpretatethe market and lose money.

 

[rajesheck]

For myself, it's was one year and then it happened again only ten years later.

It took a few months to become profitable and very consistent BITD. That was pre-2005, though.

Trading is not seasonal. It is evergreen business. We need insights to see the opportunities.

 

[Hafizmd]

Years and years and years... every year you become a better trader

 

[El OchoCinco]

All of em

 

[viruscore1]

i suspect many trader book authors are not successful traders. If you are successful why give away your secrets.

 

[bone]

I answered less than 1 year simply because in terms of intraday/day trading you will almost certainly run out of capital well before you learn to survive - much less become profitable. I greatly admire any trader with a mouse that thrives Day trading because you are a rare and truly special creature.