Prop trading/ no experience

S

Spartan08

Hi,

After getting laid off for the second time in 6 years, I've decided to try something different. I friend of mine has a friend who owns a proprietary trading firm in Chicago. They trade NYSE, Nasdaq, and AMEX. They happened to be in the process of recruiting a new "class" of fresh trainees. I did a personality profile, took a couple of tests, and had an interview. I was offered a position.

Basically, they train you and pay you a draw of $2,000/ month. After the initial training, you sit with an established pro. Even with this, I realize that this is probably a risky proposition for me. From what I understand, the odds are against you from the beginning. I realize that I very well might not be doing this a year from now, but maybe it will open up some new opportunities for me. Again, my last career (purchasing/ supply chain management) didn't seem to be working for me.

I start training on June 2nd. My question is, what should I be doing, if anything, to prepare? I am as green as they come. My knowledge of the stock/ capital markets is very, very rudimentary. I don't know if I should pick up a sort of "Day Trading for Dummies" sort of book, or if I should be looking at more basic stuff.

Any recommended reading or anything to do in general to get a little primed? I'm sorry if this thread seems redundant, but I've done some searches, but can't really find much regarding my specific situation. Maybe I'm searching wrong....

Thanks,
 
Go to a public library or Border's/Barnes&Noble in a prosperous suburb and read anything you can get your hands on related to charting and technical analysis. That ought to help a little bit so that you can develop a "visual orientation" to the market. The Idiot's Guide, Dummies Guide, and Edwards & Magee would be a good start.
 
Agreed on the books - Dummies etc will be good just to help you out with trading terminology and the basics about market structure if you really are that green.
 
Being humble is a very good start. I agree with the other traders here. Get yourself down to a good bookstore for a day or two. Hit a few specifics to increase your general knowledge..focus on General Day Trading..the Dummies book is probably a good quick overview of this crazy but great business. Then some basic Charting and Technical analysis, by one of the gods...Edwards Magee, Murphy , Pring. Get a good book on trading discipline or the psychology of being a trader. Vic Sperandeo -Trader Vic is good, Elder and Steenbarger are good too for psychology. Then look into some real good tactics books like these..The Complete Day Trader -Bernstein, Trading Rules that Work: The 28 Lessons Every Trader Must Master -Jankowsky I think. Another good one is The Master Day Trader or Tools and Tactics of the Master Day Trader by Velez and Capra. Basically you want to be a voracious reader of this stuff to be well armed. You can't read enough. Those are a few ideas that can help you get started into your new adventure. And when you start keep a trading diary everyday of what you did, did wrong..pnl and some notes. Review often as you grow. And if you're like most of us you will grow to love this amazing game. I wish you all the best..learn to cut your losses fast, stay calm, and let your profits run. Let us know how you're making out in the forums here. There a lot of smart people in here to help you grow. Cheers
 
Thanks to all for the advice.

There are so many books out there, and most of them seem to be for personal investing. Obviously, buying and selling stocks with other people's money, within a period of minutes or hours, is quite a bit different from personal finance. That's why I didn't know quite where to start. The basic books seem to be mostly for longer term investing, while books specific to day trading seemed a little too advanced for me at this point.

Anyways, thanks again.
 
Quote from Spartan08:

Hi,

they train you and pay you a draw of $2,000/ month.

More...

How long will they pay you 2k a month? Will they force you to pay back?

If you get the answers, you will know what to do in one year's time (if they pay you for one year).
 
Getting started with some information on technical analysis is a must. The first phase of learning has to be knowledge based. After that you might want to try and figure what type of trading stlye best suits you, and your personality ( im sure you've heard this); short term scalping, swing trading, position trading or long term. The good news is that your prop firm will most likely train you into one of these areas or at least expose you to them so either you or they might decipher the best fit for you. Is this Prop group still looking for recruits because I just recently began my search as well. A couple interviews but nothing concrete yet. Good luck to you in your newfound lifestyle.
 
Forgot to mention, after the knowledge portion of your learning you will ask yourself a few questions. Such as, if millions of people read the same books on technical analysis, fundamentals, investments, short and long term trading, entry and exit strategies and so on...why do 95% of people fail. Mark Douglass wrote a book on traders psychology called "trading in the zone" which is fantastic. Psychology might not seem like a big deal at the forefront of your learnings ( and compared to a basic understanding of technical analysis and market momentum it probably is not), but when the time comes to discover the merits of attitude and confidence in taking positions it will be of huge help to you and your P&L.
 
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