Reality for an Individual Trader

[justrading]

I think Surf is actually right that institutional traders, in this context, have the advantage of better information. With commodity futures, the information provided by their highly qualified and experienced research analysts is something not fully available to independent/retail traders, and individual commodities are more news/information-driven than many tradable instruments. To an experienced industrial economist, that may not be so significant, but they're a small minority of traders.

Undeniably there are independents making their full-time livings from trading commodity futures, though.

I do trade CL a little, but for myself, I find index futures (and even some currency futures) generally quite a bit easier and more approachable to the an independent trader - and I wouldn't be at all surprised if many others feel the same way.

Casting no aspersions, but when I see forum threads like the first 15 pages of this one, I can't help wondering what proportion of the respondants are actually retail-trading commodity futures on a daily basis.

There is no doubting that the Commercials and Pros who do the in-depth research have an advantage of good information. Yet from time to time we see on the COT that Specs are overwhelming and often win.

Isn't it our job as minnows to just go along with whoever is winning?

If you've ever seen live a pilot fish hitching a ride on a shark, you would know exactly the imagery I have when I put on a trade. That said, as a TA based trader, news/data is always overwhelming, so I steer clear of anything that is going to be thus affected.

Edit: To be clear, Pros who are on the same side as Commercials are classified as Specs anyway, it's just that specs can be on either side of the trade and sometimes wrong despite all the research.

 

[justrading]

@Xela i think you missed my edit. May I do you the courtesy of informing you of it.

 

[Steve Alexander]

I am interested in trading commodity futures, but I question whether it is realistic for an individual investor to compete with pro traders who have decades of experience. I have a genuine interest in this investment vehicle and not interested in a get rich quick scheme. I am willing to put in the time and hard work to educate myself. However, I don't want to be naive when it comes to thinking I or anyone who hasn't worked as a professional trader on the inside can be profitable in the long run.

Any feedback would be appreciated.

Plan to spend at least as long as getting a PhD in physics. If you're willing to do that, go for it.

 

[TheTrue1]

@drader77 , whatever you do... don't do what this guy is doing: https://www.elitetrader.com/et/threads/ym-magic.307470/#post-4420406

I would be "this guy" in your post JackRab And you are correct. If you are new too trading, I suggest you don't try what I am simply displaying at YM MAGIC. I am far from new to this my friend. Furthermore, I had a less than average week. I would tell you I usually go 6 to 8 weeks without a losing trade. But that would probably sound so improbable and unrealistic to you. So stick around and follow me for a few weeks. I will make you eat those words. Or maybe you won't. But I would gladly make an open wager with you about my performance. Please stay tuned. Make a liar out of me.

 

[Buy1Sell2]

I would tell you I usually go 6 to 8 weeks without a losing trade.

FALSE

 

[TheTrue1]

FALSE

We shall see. Time provides answers too many things. Stick around please.

 

[Traderjohnsblog]

I am interested in trading commodity futures, but I question whether it is realistic for an individual investor to compete with pro traders who have decades of experience. I have a genuine interest in this investment vehicle and not interested in a get rich quick scheme. I am willing to put in the time and hard work to educate myself. However, I don't want to be naive when it comes to thinking I or anyone who hasn't worked as a professional trader on the inside can be profitable in the long run.

Any feedback would be appreciated.

Yes it is. I compete with them everyday and make a living at in the process.

 

[TheTrue1]

The bottom line in this game is the bottom line. As an individual trader, don't get caught up in all the commentary of others. I don't care who they are. Focus on the product/market you are trading. Marry it! Get to know what makes it smile, cry, run, or shy away. The market isn't just math and mathematical equations. People make trades. Fear and greed are always present. Stay abreast of everything that affects your market. Most importantly, never risk more than you are willing too lose. Doesn't mean you wish to lose it. But you would not cripple your account and psyche, by losing it. This will remove a great deal of fear. Entry and exit is crucial. I had a friend, a retired trader. And he said to me "a trade has to look promising enough to bring him out of retirement before he places it. Don't trade just to be in a trade. Be confident about all your trades. If you were not, why did you take it.

 

[jk90029]

The only true advantage professionals have over individual traders is transaction costs and maybe orderflow due to size...

I agree that the transaction and tax might be crucial. My friend spent spent 20 years in stock market to pay roughly 500K for brokerage and tax. In average, $100 per day and 24K per year.

Stock market is basically zero-sum. During the entire life, many trader spend 50 years.

First, limit the max cost when one start trading (50 years from 30 to 80)

 

[marketsurfer]

marketsurfer, you shouldn't be allowed to comment on futures trading until you've made an actual profit trading futures

It's still the first quarter, bro. 3 more to go!

surf