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Preparing for a Life After Daytrading
- Thread starter Rahula
- Start date
Good luck man, go get em.Quote from ggoyal:
if you have 50k, buy a subway or quiznos. if you dont work there you will probably make around 30K a year net. swing trade to go along with that and you dont have to worry that much anymore!!!
I don't know about Quiznos but there's no way you can get a Subway franchise for 50k. It's in the six digits.
Quote from mde2004:
ra,
You are getting a multimillion dollar inheritance in the future so why worry about a real job. You can live off the 5% no risk interest from a online bank which will produce 100k + per year.
This is terrible advice. Things change, it's better to earn your money now than wait for something you expect. Plus, by making your own money now you will learn valuable financial management skills that will come handy no matter happens.
I GOT DOWNSIZED AFTER BUSTING MY BUTT FOR NEARLY A DECADE DUE TO AGE AND AUTOMATION OF THE BUYSIDE.
THE CORPORATE WORLD IN A WORD: SOULESS
IT WILL LITERALLY SUCK THE LIFE OUT OF YOU.
THE PEOPLE ARE GENERALLY MISERABLE AND LIVE FOR WEEKENDS AND THE POLITICS ARE BRUTAL. YOU WILL SOON REALIZE THAT VERY VERY FEW EVER ADVANCE TO THE TOP AND THOSE THAT DO ARE ONES YOU WOULDN"T WANT AS A FRIEND.
GOOD LUCK BUT DON;T SAY YOU WEREN;T WARNED.
- getting outsourced
- getting downsized
- dealing with age discrimination when you get older
- losing your job to automation
- inability to change jobs or find one, if you don't constantly keep your skills up to date with where the demand is
But I rather take all of the above risks for a steady paycheck especially since I'm planing for a family a few years down the line. I'll always be trying to improve my trading/investing skills as a hobby tough. I no longer want to get rick quick. I want to get rich slowly and steadily.
Besides I think the ideal way to go about trading is to either:
1 Trade at a hedge fund or a real IB prop desk.
2 Or swing trade as a hobby while you work at a steady job. If really successful, then use your track record to then trade OPM (you're own fund or at a hedge fund or a real prop desk).
I have no regrets because I've learned a lot that will serve me well going froward. But anyone who thinks daytrading isn't the riskiest way to trade ought to consider:
There are thousands of traders who work for hedge funds and IB prop desks. They make hundreds of thousands in salary plus another couple of hundreds of thousands (if not millions) in bonuses. So many of these guys are probably worth several million. And they know how to trade, they are expert traders. They can easily leave their jobs and trade their own money at a beach house swinging 100s of lots in futures, options, and stocks - and keep 100% of their money instead of getting a 10% bonus. But they never do that, why?
- There's a social stigma to day trading.
- There's no risk manager when you trade you're own funds. Hence there no one around that forcibly keeps risk tightly bounded - which prevents you from ever losing more than you can easily recover.
- There's no one to help you out when you're in a slump.
- There's no one around that will ensure that there is no deviation from the predefined strategy or system.
- There's no institutional resources at home as far as research, bloomberg terminals, programmers, etc. [/B][/QUOTE]
THE CORPORATE WORLD IN A WORD: SOULESS
IT WILL LITERALLY SUCK THE LIFE OUT OF YOU.
THE PEOPLE ARE GENERALLY MISERABLE AND LIVE FOR WEEKENDS AND THE POLITICS ARE BRUTAL. YOU WILL SOON REALIZE THAT VERY VERY FEW EVER ADVANCE TO THE TOP AND THOSE THAT DO ARE ONES YOU WOULDN"T WANT AS A FRIEND.
GOOD LUCK BUT DON;T SAY YOU WEREN;T WARNED.
- getting outsourced
- getting downsized
- dealing with age discrimination when you get older
- losing your job to automation
- inability to change jobs or find one, if you don't constantly keep your skills up to date with where the demand is
But I rather take all of the above risks for a steady paycheck especially since I'm planing for a family a few years down the line. I'll always be trying to improve my trading/investing skills as a hobby tough. I no longer want to get rick quick. I want to get rich slowly and steadily.
Besides I think the ideal way to go about trading is to either:
1 Trade at a hedge fund or a real IB prop desk.
2 Or swing trade as a hobby while you work at a steady job. If really successful, then use your track record to then trade OPM (you're own fund or at a hedge fund or a real prop desk).
I have no regrets because I've learned a lot that will serve me well going froward. But anyone who thinks daytrading isn't the riskiest way to trade ought to consider:
There are thousands of traders who work for hedge funds and IB prop desks. They make hundreds of thousands in salary plus another couple of hundreds of thousands (if not millions) in bonuses. So many of these guys are probably worth several million. And they know how to trade, they are expert traders. They can easily leave their jobs and trade their own money at a beach house swinging 100s of lots in futures, options, and stocks - and keep 100% of their money instead of getting a 10% bonus. But they never do that, why?
- There's a social stigma to day trading.
- There's no risk manager when you trade you're own funds. Hence there no one around that forcibly keeps risk tightly bounded - which prevents you from ever losing more than you can easily recover.
- There's no one to help you out when you're in a slump.
- There's no one around that will ensure that there is no deviation from the predefined strategy or system.
- There's no institutional resources at home as far as research, bloomberg terminals, programmers, etc. [/B][/QUOTE]
I fit the exact same description down to a T, although a year younger. First off, at least you're not considering returning to the corporate world in an accounting role. Aside from buying my home and establishing my trading capital (ok those are biggies) my 5 years post-undergrad in corp. accounting/consulting roles were the most morbid years of my life.Quote from Rahula:
I'm a 28 year old guy with a degree in economics and finance and work experience as an accountant. The biggest reason why I want to leave daytrading is because I'd like to propose to my gf and plan for kids within a couple of years
I think you should just take a step away from the intraday and trade larger timeframes. Follow the journals on this site over the years and you'll see the 90% rule play out, very few make it daytrading. Futuresscalper made a good post about his daytrading method here. That's probably the best & only way to go about discretionary daytrading, unless you happen to be a full-out MarkBrown-esque systems master.
I trade the larger timeframe. My methodology is not much different than what optioncoach described, and like him, you'd have to put a gun to my head before I went back to corporate. I'm up 6 figures on the year, averaging only 1 r/t a month, large size on only very high probability setups. Spend a lot of my time traveling, biking, reading, enjoying many more fruits of life. Just took my gf on a 7 country tour of europe for her bday, that's up from a $100 gift certificate last year when I was a corporate drone (and routinely denied any vacation time beyond a 4-day weekend).
You have a tremendous benefit most of us would dream of in terms of a multimillion $ payday at some point in the future. Thus, you should have an even larger risk tolerance today. Do you really want to spend the best years of your life back in a cubicle?
I started a thread a year or two ago regarding the same topic. I updated my progress in January of this year. I must say my quality of life is much better now. The key is finding something else you really like doing because then it does not really feel like work. A big eye opener for me was realizing how much work I was put into trading and wondered what would happen if I put the same amount of time and energy into something else that had a much higher success rate. The other thing is that many other careers offer just as much upside or more then trading would for most traders. Here is the thread I am referring too.
http://elitetrader.com/vb/showthread.php?s=&threadid=61057&highlight=resume
http://elitetrader.com/vb/showthread.php?s=&threadid=61057&highlight=resume
Quote from midlifeguy:
I GOT DOWNSIZED AFTER BUSTING MY BUTT FOR NEARLY A DECADE DUE TO AGE AND AUTOMATION OF THE BUYSIDE.
THE CORPORATE WORLD IN A WORD: SOULESS
IT WILL LITERALLY SUCK THE LIFE OUT OF YOU.
THE PEOPLE ARE GENERALLY MISERABLE AND LIVE FOR WEEKENDS AND THE POLITICS ARE BRUTAL. YOU WILL SOON REALIZE THAT VERY VERY FEW EVER ADVANCE TO THE TOP AND THOSE THAT DO ARE ONES YOU WOULDN"T WANT AS A FRIEND.
GOOD LUCK BUT DON;T SAY YOU WEREN;T WARNED.
I aware of the risks like I've stated in an earlier post. But not all jobs are that bad like the one you mentioned. Besides I'm not going to take just any job - only one in a somewhat decent environment and decent hours. And if its really that bad for me then it'll just motivate me to be a much better swing trader/investor so that I don't have to rely entirely on the job.
Besides, happiness has little to do with the circumstances you find yourself in but rather what you're attitude towards your circumstances is. Being alive is like winning the lottery everyday - lots to be grateful for. But the ego won't allow gratitude - it sees itself as the victim all the time. I bet Bill Gates is sitting on a toilet right now complaining about the butt-kicking GOOG is giving MSFT, yet he's there sitting on a million dollar toilet seat - and that's the power of ego to ruin your mind now matter how well off you really are.
Quote from Trader KGB:
I fit the exact same description down to a T, although a year younger. First off, at least you're not considering returning to the corporate world in an accounting role. Aside from buying my home and establishing my trading capital (ok those are biggies) my 5 years post-undergrad in corp. accounting/consulting roles were the most morbid years of my life.
I think you should just take a step away from the intraday and trade larger timeframes. Follow the journals on this site over the years and you'll see the 90% rule play out, very few make it daytrading. Futuresscalper made a good post about his daytrading method here. That's probably the best & only way to go about discretionary daytrading, unless you happen to be a full-out MarkBrown-esque systems master.
I trade the larger timeframe. My methodology is not much different than what optioncoach described, and like him, you'd have to put a gun to my head before I went back to corporate. I'm up 6 figures on the year, averaging only 1 r/t a month, large size on only very high probability setups. Spend a lot of my time traveling, biking, reading, enjoying many more fruits of life. Just took my gf on a 7 country tour of europe for her bday, that's up from a $100 gift certificate last year when I was a corporate drone (and routinely denied any vacation time beyond a 4-day weekend).
You have a tremendous benefit most of us would dream of in terms of a multimillion $ payday at some point in the future. Thus, you should have an even larger risk tolerance today. Do you really want to spend the best years of your life back in a cubicle?
Congratulations on your success. I know I'm not going to find a job right away so in the meantime I will trade and may not take any job offers only if: (1) my trading is flawless as far as no deviations from my trading plan and (2) if I'm making more than I could ever make at a job - then and only then would I continue trading.
But even then - I'd probably prefer to trade for a hedge fund or real prop firm. If I can't trade at a hedge fund or a true prop firm then here's my idea of a firm worth committing to a career as a trader would be:
- A true partnership with 100k minimum investment.
- Only consistent experienced traders with track records would be allowed to be a partner.
- Every trader would keep 50% off all his net profits. The other 50% would go into a PL pool with all other traders and get distributed equally.
- Eventually form a CTA/CPO and solicit outside funds using the track record of the entire fund. Standard 2/20 structure with profits distribution based on a mixed of individual and firm performance.
That's the only way I'd want to continue trading. I don't want to follow the DIM (Do It Myself) path anymore - I see very little long-term value in that way of going about things. If you take away all the institutional resources most institutional traders have - they probably would not be as successful as they are. There is tremendous benefit to working together, helping other traders, and being helped by other traders. I bet many hedge funds with lots of traders like SAC rarely has a down day even though some traders may have down days. I heard that even WorldCo rarely had a down day even when they are financing traders. The point working together reduces risk and improves consistency.