Quitting Trading Job at my Bank to Day Trade at Home

[cmb]

I would say attempting to purposefully get fired, so that you can receive welfare from the tax payers and employers of this country while you try your hand at trading, is very worthy of attack.

That's pretty despicable.

As opposed to the banks leaning on the taxpayer when their trades did not work out?

 

[traderslair]

Trading your own money to pay your bills or trading the bank account where nobody cares if you blow up except you and your manager and the bonuses, is a completely different game.

I know personally 4 professional traders who couldn't do it on their own. Maybe you can.

Good luck.

 

[helgen_1]

I have a trading strategy at work that is consistent and profitable...

What is all the disbelief that you and others express in this thread? Why is an edge suddenly to disappear? I see bars going up and I see bars going down. Same as they did 10 years ago and same as they did 30 years ago. Why make this so complicated? You are not going to live forever. Make your move.

But then again, you come on a message board asking for directions to challenges that can have huge implications for your family life. So that means you're not ready for it.

H.

 

[Visaria]

I would say yes, do it. I assume you have plenty of money saved up?

 

[ammo]

"If I quit, the economy tanks, the strategy fails, and I'm left without a means of income then yes, I am screwed. At some point the reward has to be worth the risk, though. "


if the economy built like a straw house fails,and your strategy then stops working, what's your backup plan?

 

[JayS]

A few questions if you have time....

Does your wife work?

If yes how much of your monthly budget will her salary cover?

How much do you have on hand to trade with?

How much in addition do you have for an emergency fund?

Have you signed a non-compete?

 

[NoDoji]

Looking back historically it has been profitable as far back as bloomberg has data.

I think I haven't made this clear. I trade this strategy right now at work every day in the desk's portfolio. Over 80 business days of doing it I am up 70 of those. My net profit is 50% of the capital I am using using. My worst down day is about 70% of my best up day. The down days come in clusters because I get into a position that I can't easily liquidate due to market constraints so I have to keep it on for a few days and slowly trade out of it. At home that wont be an issue because I will be trading 1/10th the size and can close the position in 1-2 trades.

So looking back historically you have a strategy that's been profitable since around 1986. It's clearly survived every market environment we've been through to date, including bull, bear, range, single day crashes and trading halts.

You've been trading this strategy for 80 trading days and have demonstrated in the real live market that the system is extremely profitable (50% ROI in just a third of a trading year) and has a positive risk:reward ratio as well despite the fact that you have to compensate for the liquidity constraints that come with trading significant size.

Based on this, you can assume that your outcome will be even better if you trade this strategy on your own with 1/10th size.

Correct me if I'm missing something here, but it seems to me that the only question you have to answer is whether 1/10th the profit you made in 80 days produces an income greater than (or similar to) what you're getting paid now.

 

[XChamp]

First, I really want to thank people for the responses. They have been very good. Thanks.

It sounds like you made your decision and are just trying to justify it. Good Luck

Secondly, I've made the decision about whether it's a currently profitable strategy at work. What I haven't quite decided is whether it will be profitable at home. Everything is done for you at a bank. Market data, software set up, internet connection, margin posting, all the exchange fees are miniscule and brokerage is 0 or tiny, bloomberg access, economists giving a warning about numbers that are released early, etc. I've thought about these things and think it's still doable, but I'm just worried I'm missing something mechanical. Maybe I'll find out that the exchanges like to charge a $1,000 convenience fee per month that is not listed in their fee schedule.

The personal aspect is a different matter since that is totally dependent on each person. I don't expect advice on that from a message board.

 

[XChamp]

A few questions if you have time....
Have you signed a non-compete?

Yes I have. I think I am in the clear as long as I don't form a legal entity. Clawback is up to the firm's discretion though so I plan to ask the clawback committee right before I resign, just to make absolutely sure.

 

[newwurldmn]

Math doesn't add up:

Strategy can't make 10MM for the bank (pretend it makes 9MM).
You will run it at 1/10th the size at home: 900k

Is the extra risk really worth your annuity as a sellside trader?