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- Thread starter tradervic
- Start date
Tradervic,
Personally, I would start PT and swingtrade with IB. If you can check your holdings and make adjustments throughout the day, you should be in good shape. It doesn't take much, just a few minutes every few hours to check in and see where things are going.
I started FT making 6 figures in IT also and traded PT. After a few years I went PT in IT and now trade PT also...point being I can make plenty without working FT any more. I need a bigger egg to completely break the ties. IB has the best commissions. You will have to spend a great deal of time figuring out what will work best for you, daytrading, swing trading and whether you will consider any fundamentals in the equation. Most everyone here does things slightly different and many are successful in their own game.
Good Luck!
Personally, I would start PT and swingtrade with IB. If you can check your holdings and make adjustments throughout the day, you should be in good shape. It doesn't take much, just a few minutes every few hours to check in and see where things are going.
I started FT making 6 figures in IT also and traded PT. After a few years I went PT in IT and now trade PT also...point being I can make plenty without working FT any more. I need a bigger egg to completely break the ties. IB has the best commissions. You will have to spend a great deal of time figuring out what will work best for you, daytrading, swing trading and whether you will consider any fundamentals in the equation. Most everyone here does things slightly different and many are successful in their own game.
Good Luck!
tradervic,
My circumstance is very similar to yours. I currently hold an IT job in the six figures, and have wrestled with going full-time to trading or not. I've decided for now to keep the job, as there is no way I can realistically make that much money trading yet.
I trade the S&P e-mini exclusively using 1 minutes charts and a system that averages about a .65 batting average. I use IB. My average trade is about 6 minutes long, so I can do 1 or 2 a day and not impact my work.
Just my opinion, but given you can't afford to go long without income, keep the job and trade on the side. If you are required to be profitable to pay for living experiences, you'll probably feel too much pressure to make money and emotions will run rampant, causing you to trade poorly. Gain experience/confidence slowly and make the job decision later.
My circumstance is very similar to yours. I currently hold an IT job in the six figures, and have wrestled with going full-time to trading or not. I've decided for now to keep the job, as there is no way I can realistically make that much money trading yet.
I trade the S&P e-mini exclusively using 1 minutes charts and a system that averages about a .65 batting average. I use IB. My average trade is about 6 minutes long, so I can do 1 or 2 a day and not impact my work.
Just my opinion, but given you can't afford to go long without income, keep the job and trade on the side. If you are required to be profitable to pay for living experiences, you'll probably feel too much pressure to make money and emotions will run rampant, causing you to trade poorly. Gain experience/confidence slowly and make the job decision later.
The difference between a pit trader and us (those who have a full time job aside from trading) is that the pit traders HAVE to trade. We don't have to play when we don't want to. My point is this : you love trading and you want to trade, but you're not realizing that one true luxury you have is the fact that with your IT job, you don't HAVE to play when you don't want to. This gives you a huge advantage when you're learning. It also helps to keep your mind off of trades that went bad, and lets you stay fresh for trading by limiting the amount of time you can spend.
I'm in the same boat - here's what I've been doing to stay alive while I'm learning :
1) Trade 200 shares and keep super-tight stops (a dime to 15 cents). You will get stopped out alot, but you will also learn to have the balls to get back in again if it reverses after you get stopped out. Being right is easy; being right at the right time is the hard part.
2) Never pay the spread. If you can't buy on the bid, then the stock is probably moving too fast for a newbie anyway.
3) Have a quality system with good charting software (plenty of info on that here) and a RELIABLE data feed.
Hope this helps
-Ken
I'm in the same boat - here's what I've been doing to stay alive while I'm learning :
1) Trade 200 shares and keep super-tight stops (a dime to 15 cents). You will get stopped out alot, but you will also learn to have the balls to get back in again if it reverses after you get stopped out. Being right is easy; being right at the right time is the hard part.
2) Never pay the spread. If you can't buy on the bid, then the stock is probably moving too fast for a newbie anyway.
3) Have a quality system with good charting software (plenty of info on that here) and a RELIABLE data feed.
Hope this helps
-Ken
I appreciate everyones comments, they've helped me tremendously. It looks like a few of you are trading part-time successfully, so I am encouraged. I guess I have something in common with the last 2 posts, I've done very well in the IT industry dont plan on walking away from that at this time.
It looks like I might be trading the eminis, they seem to have the best trading possibilities and I dont need to start with a 25k account to trade frequently.
Swing trading sounds attractive also, regarding my inability to stay glued to the screen.
I have another question for swing traders, has anyone tried using options to hedge open positions versus using wide stop loss points which seem necessary when swing trading?
Also, have you guys established a corporate entity for trading like an S-corp or LLC?
tradervic
It looks like I might be trading the eminis, they seem to have the best trading possibilities and I dont need to start with a 25k account to trade frequently.
Swing trading sounds attractive also, regarding my inability to stay glued to the screen.
I have another question for swing traders, has anyone tried using options to hedge open positions versus using wide stop loss points which seem necessary when swing trading?
Also, have you guys established a corporate entity for trading like an S-corp or LLC?
tradervic
You have to be willing to cut down on your lifestyle IMO if you want to start trading for a living. I 'll never understand these guys comfortably making 6 figures at some company and who now want the freedom of trading but would rather avoid the income uncertainty that comes with it. You have to be an entrepreneur and willing to risk almost everything that means your savings, your health, relationship etc. Understand that failure is a very possible outcome. Trading is the most difficult thing to do. Personally I am young, single, extremely low living expenses(pretty much no bills to pay), thrifty lifestyle. I can live with very little money , anyway I am a college dropout so whatelse am I going to do? Also expect people to think you are crazy.
trader vic, I am on a similar boat as yours... IT job, IT salary, likes the trading thing.
There is no need to quit job. develop a system, develop automatic trading interface and let the machine trade away.. hire some kid for $8/hr to look after it just in case accidents happen.
I am not there yet.. but that's my goal.
Better do it quick though... I envision in a few years markets becoming more and more efficient as too many robots will be in the market and eventually all markets will be ruined and become totally random and only brokers will make money.
There is no need to quit job. develop a system, develop automatic trading interface and let the machine trade away.. hire some kid for $8/hr to look after it just in case accidents happen.
I am not there yet.. but that's my goal.
Better do it quick though... I envision in a few years markets becoming more and more efficient as too many robots will be in the market and eventually all markets will be ruined and become totally random and only brokers will make money.
Getting out of IT for a few years could be costly too. The stuff moves quickly and you have to stay in touch...unlike fishing!!!
On your options question: I use options a great deal to hedge positions. Most of my positions that are over $10 are combination positions with options to hedge. I will usually enter the underlying then wait til it starts to move to put the options trade on. I always look at the options before buying the underlying to develop a plan. If they are overpriced and have a lot of volatility priced in, I will look to sell to hedge. If they're cheap, I may buy. I rarely hold anything more than a few months unless it has solid fundamentals and I'm lowering my basis by selling options and not getting called away. Options are a great tool and essential for risk management.
On your options question: I use options a great deal to hedge positions. Most of my positions that are over $10 are combination positions with options to hedge. I will usually enter the underlying then wait til it starts to move to put the options trade on. I always look at the options before buying the underlying to develop a plan. If they are overpriced and have a lot of volatility priced in, I will look to sell to hedge. If they're cheap, I may buy. I rarely hold anything more than a few months unless it has solid fundamentals and I'm lowering my basis by selling options and not getting called away. Options are a great tool and essential for risk management.
tradervic,
If you don't dislike your job, I don't think it's a good idea to go full time, not at least not at the outset. There will be times when you get so frustrated with trading that you would want to go back to your job. When you have a job, you may at least once in a while get the acknowledgment and recognition you deserve. But when trading, you are pretty much on your own. You lick your own wounds, so to speak, if you lose; but when you make money, you don't necessarily get congratulated on your efforts. Trading full time could be a very lonely business. I think a lot of people quit not simply because they lose their capital but because they can't take it in the sense I just said. I tried full-time for a while but decided that it was not for me, at least not for now.
In any case, regarding hedging using options, in fact, some people use the short-term swings to make money both ways in their stock and option positions. In any case, read a good book on options. I think options are a good trading vehicle.
If you don't dislike your job, I don't think it's a good idea to go full time, not at least not at the outset. There will be times when you get so frustrated with trading that you would want to go back to your job. When you have a job, you may at least once in a while get the acknowledgment and recognition you deserve. But when trading, you are pretty much on your own. You lick your own wounds, so to speak, if you lose; but when you make money, you don't necessarily get congratulated on your efforts. Trading full time could be a very lonely business. I think a lot of people quit not simply because they lose their capital but because they can't take it in the sense I just said. I tried full-time for a while but decided that it was not for me, at least not for now.
In any case, regarding hedging using options, in fact, some people use the short-term swings to make money both ways in their stock and option positions. In any case, read a good book on options. I think options are a good trading vehicle.
I trade full time and I came from the IT field, and my answer to your question is a resounding no. If you have no commitment and are single, then this may be an option for you, but if you have a family to support your current income is greater than 90% of the trading population. At my firm the technical support people make more money than 60% of the traders.
Swing trade part time and see how you perform, I was making 55K a year, had I been making six figures you probably won't be reading my journals.
Swing trade part time and see how you perform, I was making 55K a year, had I been making six figures you probably won't be reading my journals.