Start-up Capital - Loans, etc...

Quote from Worldcrusher:

Wow, thanks very much for your time in writing that post and giving me your story, it means a lot. When it comes to finding options (no pun intended) and coming up with ideas this is invaluable. Is there anything you didn't like about Bright? Was their training solid? Ah and one more thing: any free (or trial)data feed programs?

Thanks again Daryl
More...
 
im new to trading and havent gone thru major losses, but i agree with worldcrusher's advice.

here's my own advise. learn futures. no pdt rule. less charts to watch / keep track of. and when starting out that's pretty important so you dont get too overwhelmed. start there and save up to one day be able to day trade stocks.

being able to only day trade 3X per 5 days plays too much on the psyche. keeps me looking for that white whale of a trade and in the mean time i miss out on plenty of good smaller trades. i think i understand why this rule is in place and why so many people loose money when they start.

or maybe everyone starting out should trade the opposite direction of what they think they should.
 
Quote from mdhtrader:

Quote from Worldcrusher:

Wow, thanks very much for your time in writing that post and giving me your story, it means a lot. When it comes to finding options (no pun intended) and coming up with ideas this is invaluable. Is there anything you didn't like about Bright? Was their training solid? Ah and one more thing: any free (or trial)data feed programs?

Thanks again Daryl
More...

You are very welcome, mdhtrader. As for Bright, it was the only prop firm I ever joined so I have nothing to compare it to. However, I selected them because they appeared to be honest and straight forward, had many strong traders with them, had a good reputation here on ET, and had been around for awhile. I can say that I wasn't let down. They also permitted me to trade remotely which was important. But there are a lot of fees associated with being a prop trader which increases the amount required that a new trader has to earn just to break even. You will increase your probability of success by keeping your costs down as much as possible in the beginning, especially for someone with a small trading account.

The best thing I took away from the Bright experience was the mentorship program which is extremely cheap compared to what you would have to pay for the services of a successful trader. You will find that successful traders are rare, successful traders that can communicate what they do even rarer, and successful traders who can communicate what they do AND want to share their time with a new trader to be almost non-existent. Other than that, I was very unimpressed with the other training they offered as anything more than an introduction to trading the Rediplus software and a chance to meet other traders.

One thing to think about with Bright is that their focus is on the application of fundamental analysis to pair trading and openings. These methodologies are capital intensive which means you will have to use substantial leverage and thereby pay a good deal in interest and haircut fees. Once again, for someone trying to transition with a small account, I think it is important to find methodologies that are not capital intensive, at least initially. This is why I gravitated towards technical analysis and trading futures.

One other issue I would recommend you consider is that to join Bright you will have to get your series 7. It will be a minimum of $500 for study materials and testing (from what I remember) and another $500 or so for annual exchange fees charged up front. Now you are considered a "professional" and held to a higher standard and that is not a bad thing in and of itself. But it means that you now pay a lot more for any exchange related service you pay such as datafeeds. It is also a lot easier to get sued. I actually regret obtaining my series 7 and will probably let it expire simply due to the costs and the fact that I no longer trade stocks. With that being said, it was a necessary step in my particular evolution into becoming a trader.

I mentioned Ninja trader as a free simulator and it is excellent. Free data feeds are another story. Many offer a free trial period, but I am not sure of any good ones that are free for real time data. Data feeds are not cheap and you have to use a good one. This is one area that you need to get the ebst you can afford. I think esignal goes for about $150-250 per month.

BTW, it says a lot about you that you are seeking this information out before starting. You are open to feedback and these characteristics are conducive to learning to trade.

Hope that helps! Let us know how it goes.

Sincerely,
Daryl
More...
 
Quote from Worldcrusher:

I mentioned Ninja trader as a free simulator and it is excellent. Free data feeds are another story. Many offer a free trial period, but I am not sure of any good ones that are free for real time data. Data feeds are not cheap and you have to use a good one. This is one area that you need to get the ebst you can afford. I think esignal goes for about $150-250 per month.
More...

If you can borrow $10k off a friend for a few weeks you can open an IB account and then just withdraw the majority of the funds. They give you market data for next to nothing.
 
Quote from Worldcrusher:

Daryl
More...

Thanks again Daryl, you've been a huge help/moral booster.

Do you (or anyone) think Forex would be a good place to start as well?
 
Yes I think Forex is good, but maybe for reasons other than making money.

You can open and fund an account with next to nothing and actually get some "skin in the game" for around $70 for a 10,000 lot of a pair such as EUR/USD. I believe some firms, actually let you do it for even cheaper.(The big "O")

This will at least let you learn what it "feels" like to trade and lose or perhaps even make a bit of money.

I actually recommend it to many close friends so that they will start to understand what trading is really like.

I heard someone once say, "You will never be as bad at something as you are right now."

Experience is very important. And while you are gaining it, you need to do it for as cheaply as possible.

I wish you the best!!
 
Quote from stock_trad3r:

you must pay to play

get an account of 50k or more

100k is preferrable
More...

Seems simple enough, now all anyone has to do is "get" 50K or preferably 100K. :confused:

I am about to trade with a borrowed stake. I used a low interest credit card advance, which is good for the life of the balance. As part of my plan though, I have set myself up with several part time jobs that just cover my living expenses by working afternoons and evenings, mostly outside of market hours. These jobs would interfere with a full time 9-5 though, so doing both is not an option.

I also have some backup living expenses saved. I can make nothing from trading for quite a while and still be fine. The goal at first is learning to grow the account, slowly increase my position sizes, and someday reach a level where I could support myself from trading. Until then, any gains no matter how small are acceptable. Even breaking even or small losses are acceptable for a time as long as I'm learning.

If I fail and lose the whole stake, I'll have to pay it back at a rate of a few hundred dollars a month for a few years. That would suck, but it seems the same result to me if I had saved that money for a few years and lost it. Plus I get to start now, instead of years from now, and I feel I have to act while my situation allows it.
 
Quote from mdhtrader:

Thanks again Daryl, you've been a huge help/moral booster.

Do you (or anyone) think Forex would be a good place to start as well?
More...

I do not think that Forex is a bad place to start, as long as a beginning trader starts out on a good simulator. The inherent problem/benefit of currencies is the enormous leverage. A new trader with leverage is a lot like a kid in a candy store. So the simulator permits the new trader to get a feel for this market and how leverage influences trading it.

In my experience, I have seen that there are three components necessary to become a good trader: 1.) discretion, 2.) money management, and, 3.) a respect for the markets.

Discretion is the ability of a trader to look at the indicators and the given situation and be able to use his/her discretion to know what is important and what is not. The ONLY way to learn discretion is through experience. Money management is more important than the trading methodology because all trading systems eventually lose money. It doesn't matter how much was gained if it is all consumed on a losing trade/day. Respect for the markets comes from losing money to the markets. Quite frankly, I do not know how to learn to respect the market any other way. I believe that is why almost all successful traders have blown out their account at least once in their career, Many I have met have done it multiple times.

So while I suggest using a simulator, I think it will eventually come down to losing money to really learn. (Every kid seems to have to touch the hot stove despite being told over and over again that they will be burned). I accept that as a basic quality of Human nature and ultimately each trader will make their own decisions.

Sorry if this message is a bit bleak. My intent is not to dissuade you from trading; only to save you some of the painful lessons I had to endure and to be as honest about it as I can be.

Sincerely,
Daryl
 
You must log in or register to reply here.
Back
Top