You're right. "Expect" was a bad use of terms. Rather, I'm curious if there is some sort of average or median that I can use. I have been successfully "investing" for many years, as well as shorter term trading in between stocks and options but now need to turn all of this into short term trading techniques that will give me daily, weekly, monthly profitability for a living.
Trading as a New Career...
- Thread starter TampaTrader
- Start date
Hey Noobie start here http://www.elitetrader.com/vb/search.php?s=
It's the Search Page for ET. Try using it instead of asking the same question ervery other noob before you did.
I'm sure that most of you on here has somehow formulated a "List of Things To Do" by now....
Meaning, you can now share what you wished you had long ago...."If i only knew then what I knew now".
Also, a basic "knowledge packet" would be great if anyone could come up with one. Something to the effect of about 2-3 books, 3-4 links to online instruction (basic knowledge), and about 2-3 suggestions of members who may serve as mentors to help along the way!
Again, thanks to all.
Meaning, you can now share what you wished you had long ago...."If i only knew then what I knew now".
Also, a basic "knowledge packet" would be great if anyone could come up with one. Something to the effect of about 2-3 books, 3-4 links to online instruction (basic knowledge), and about 2-3 suggestions of members who may serve as mentors to help along the way!
Again, thanks to all.
1. Do not trade in front of anything Fed related. Beige book, Fomc minutes and Fed meetings. Its too shaky. Also check to see if any fed governors are on the docket to possibly speak. Nothing is worse when you are in a positon unaware of something fed.
2. Stay flat before big economic numbers, employment gdp,cpi,ppi,etc. React to how big money reacts.
3. Now where all the moving averages are, open low hi closes also from previous day. Program trading gun for these numbers that are available to all traders.
4.Be dynamic and keep adding to your knowledge base
5.Trading is not easy so expect to be frustrated until you become profitable.
6. Do not set a dollar amount for each day. Take whatever you get each day is different.
These are some basics, Im tired of typing and watching this boring day. Good luck to you.
2. Stay flat before big economic numbers, employment gdp,cpi,ppi,etc. React to how big money reacts.
3. Now where all the moving averages are, open low hi closes also from previous day. Program trading gun for these numbers that are available to all traders.
4.Be dynamic and keep adding to your knowledge base
5.Trading is not easy so expect to be frustrated until you become profitable.
6. Do not set a dollar amount for each day. Take whatever you get each day is different.
These are some basics, Im tired of typing and watching this boring day. Good luck to you.
Hey Tampa,
In terms of background, I've been 'trading' as a hobby since Etrade first came out with a DOS-based electronic platform back around the late 80s, but with very little knowledge or technical training, and certainly no real industry experience. Recently I left my career as a Management Consultant and decided to take this hobby a bit further and try to actually make a living out of it. I'll give you the bullet list of my findings while trying to educate myself on this new career. I'm sure other people will have different experiences and opinions so take it for what it's worth, just another perspective.
- When I first started to educate myself on trading as a career, as a trained engineer and business man, I expected to find one or two 'best' approaches and then it would simply be a matter of digging in and mastering these approaches in order to succeed...lol..wrong...there are as many different strategies, methods, preferences, philosophies, etc., as there are people in the business. For me it was easier to first try to get a handle on what, where, how, when, etc. can you trade, and then try different combinations to see what fits me best. It really seems to be a personal decision more than anything else.
- Along those lines, there is an unbelievable amount of trash information out there. Books, webistes, blogs, magazines, etc., all tend to push grand ideas and gold pots at the ends of rainbows, so it's really difficult to find what you really need to know (i.e., stuff that's actually helpful). I read all the classics (livermore, murphy, edwards, pring, o'neil, etc.) and they all help add perspective, but I did find that Dr. Elder's books were probably the most efficient in terms of providing practical and theoretical concepts that you could actually use to start creating your own plan. Also, the Market Wizards books helped me quite a bit in terms of gaining perspective on how different trader's work. They are a good source of motivation although I'm not sure that was the intent. Also, I've found that it helps to subscribe to some of the industry magazines like S&C, Active Trader, Trader Monthly, etc., because just like any other career, they keep you in touch with the pulse of the industry.
- I was pretty good about having high hopes but low expectations. Whatever your expectations are, just lower them quite a bit and you'll be better off..lol. Most people want to get into the business for the ideas of freedom, wealth, independence, etc. You really have to look at it like any other job that is going to take a LOT of hard work, time, and effort to be successful. I'm fairly confident that if I don't put the same effort it took me to make Partner in my consulting firm, into trading, then it just isn't going to happen. There is no easy money. I would probably add that Trading as a career might be more difficult simply because you have to discipline yourself to work hard on a day-to-day basis with very little peer interaction.
- I found that it is very difficult to find good mentorship or training. Can't say I've really found anything good yet in a year of looking. I've got one newsletter service that I still subscribe to that helps me gain a Trader's perspective, and have gone though about a dozen that I think are really only useful to feed the Market Makers
I am currently looking for professional training but still working things through the hype filter.
- In terms of a practical guide to getting started the only advice I can offer I'm sure is already stated elsewhere in this forum:
1 - Learn about the different styles of trading and choose one to start with. You'll find your path as you go, but you can't learn without experimentation.
2 - Pick your platform, broker, etc. of choice and learn to use it well (don't worry about picking the perfect one - they will all do the job and you will change them anyway as you grow ).
3 - Start with a small account that you consider expendable and apply all of the discipline you would if you were trading your life savings and had nothing else. Master the basics first, worry about total $ return afterwards. (I thought Edwards did a good job of summarizing what you should do as part of your overall approach - ie.., have a plan, document what you do and why, risk mgmt, position sizing, etc...)
4 - Develop a routine just like you would at work. Dont just sit down in front of your PC like it was a slot machine. Structure your schedule, plan your work, work your plan...
5 - Find some good material on the Psychology of trading also. Don't overlook this aspect. It's easy to get caught up in the mechanics of it all and forget the mental game.
6 - Find good sources of information. Meet and interact with real traders who do this for a living, and successfully feed their families via the market. Keep up-to-date, and most importantly , form you own opinions based on constantly updating and growing your knowledge
Well, I hope this is helpful. I'm sure others have more to add and possibly different opinions. Good luck and good trading.
CL
In terms of background, I've been 'trading' as a hobby since Etrade first came out with a DOS-based electronic platform back around the late 80s, but with very little knowledge or technical training, and certainly no real industry experience. Recently I left my career as a Management Consultant and decided to take this hobby a bit further and try to actually make a living out of it. I'll give you the bullet list of my findings while trying to educate myself on this new career. I'm sure other people will have different experiences and opinions so take it for what it's worth, just another perspective.
- When I first started to educate myself on trading as a career, as a trained engineer and business man, I expected to find one or two 'best' approaches and then it would simply be a matter of digging in and mastering these approaches in order to succeed...lol..wrong...there are as many different strategies, methods, preferences, philosophies, etc., as there are people in the business. For me it was easier to first try to get a handle on what, where, how, when, etc. can you trade, and then try different combinations to see what fits me best. It really seems to be a personal decision more than anything else.
- Along those lines, there is an unbelievable amount of trash information out there. Books, webistes, blogs, magazines, etc., all tend to push grand ideas and gold pots at the ends of rainbows, so it's really difficult to find what you really need to know (i.e., stuff that's actually helpful). I read all the classics (livermore, murphy, edwards, pring, o'neil, etc.) and they all help add perspective, but I did find that Dr. Elder's books were probably the most efficient in terms of providing practical and theoretical concepts that you could actually use to start creating your own plan. Also, the Market Wizards books helped me quite a bit in terms of gaining perspective on how different trader's work. They are a good source of motivation although I'm not sure that was the intent. Also, I've found that it helps to subscribe to some of the industry magazines like S&C, Active Trader, Trader Monthly, etc., because just like any other career, they keep you in touch with the pulse of the industry.
- I was pretty good about having high hopes but low expectations. Whatever your expectations are, just lower them quite a bit and you'll be better off..lol. Most people want to get into the business for the ideas of freedom, wealth, independence, etc. You really have to look at it like any other job that is going to take a LOT of hard work, time, and effort to be successful. I'm fairly confident that if I don't put the same effort it took me to make Partner in my consulting firm, into trading, then it just isn't going to happen. There is no easy money. I would probably add that Trading as a career might be more difficult simply because you have to discipline yourself to work hard on a day-to-day basis with very little peer interaction.
- I found that it is very difficult to find good mentorship or training. Can't say I've really found anything good yet in a year of looking. I've got one newsletter service that I still subscribe to that helps me gain a Trader's perspective, and have gone though about a dozen that I think are really only useful to feed the Market Makers
I am currently looking for professional training but still working things through the hype filter.- In terms of a practical guide to getting started the only advice I can offer I'm sure is already stated elsewhere in this forum:
1 - Learn about the different styles of trading and choose one to start with. You'll find your path as you go, but you can't learn without experimentation.
2 - Pick your platform, broker, etc. of choice and learn to use it well (don't worry about picking the perfect one - they will all do the job and you will change them anyway as you grow ).
3 - Start with a small account that you consider expendable and apply all of the discipline you would if you were trading your life savings and had nothing else. Master the basics first, worry about total $ return afterwards. (I thought Edwards did a good job of summarizing what you should do as part of your overall approach - ie.., have a plan, document what you do and why, risk mgmt, position sizing, etc...)
4 - Develop a routine just like you would at work. Dont just sit down in front of your PC like it was a slot machine. Structure your schedule, plan your work, work your plan...
5 - Find some good material on the Psychology of trading also. Don't overlook this aspect. It's easy to get caught up in the mechanics of it all and forget the mental game.
6 - Find good sources of information. Meet and interact with real traders who do this for a living, and successfully feed their families via the market. Keep up-to-date, and most importantly , form you own opinions based on constantly updating and growing your knowledge
Well, I hope this is helpful. I'm sure others have more to add and possibly different opinions. Good luck and good trading.
CL
Tampa - welcome and good luck. You've already seen the flaming, so get used to it here.
A few things I would recommend:
1) Find a vehicle to trade and study it inside/out. I would recommend futures - in particular, the e-mini indexes and in particular the ES, NQ and EC. In my opinion there are so many stocks out there that just trying to guess where to start is a huge task. With the indexes, there's only so many to choose from.
2) http://www.elitetrader.com/vb/showthread.php?s=&threadid=74366 In that thread, the 3rd post down, I gave some book ideas.
3) Be ready to lose. You asked if 1k up to 10k was a good level to start at and I think that 10k is WAY to low. You are going to blow thru 10k in no time. Consider it 'cost of admission' or your 'tuition'.
4) Check the CME and CBOT website for some great, free educational materials. If you do enough searches on google, you will find A LOT of free stuff. See what interests you and then narrow it down.
5) Keep everything realistic - making $5k on $10k PER month is not even close to realistic. Let's say you got lucky and pulled off a +3% in your first month. That is a whole $300 pre-tax on $10k. That again is why I said what I did in point #3. Starting with too little money and expecting way too much from that will destroy your confidence real quick.
6) It sounds like you are planning to quit your current job and trade. Good for you, I did something similar; however, get as much studying in NOW - nights, weekends, etc. You have to view this as a full-time job, not a get rich quick plan. Get ready for people to tell you that you are nuts for leaving your $5k+ per month job to be a trader.
7) Be ready to spend money on books, cd's, seminars, etc. In the beginning, you will be looking for the holy grail that does not exist. And all of us here will tell you it does not exist, but you will still keep looking for it.
8) Keep away from the infomercial crap. Also keep away from bigtrends.com - they are terrible.
9) Get a paper trading account opened ASAP and start having at it. Think you just 'know' SIRI is going to pop now, then buy it. See how it goes.
10) Lastly, do not be afraid to go Short. I don't know why, many newbies won't even think of shorting and leave A LOT of $$$ on the table in the process. If you can only make money when the market is going up, good luck. In futures, shorting is extremely easy and very profitable when you are right.
Good luck and maybe consider starting a journal here and you may get some feedback. Just call it something like "Newbie journal, expect stupid sh*t to happen here".
PS
Please use the search feature as well on ET. There's a lot of great posts here when you find them.
A few things I would recommend:
1) Find a vehicle to trade and study it inside/out. I would recommend futures - in particular, the e-mini indexes and in particular the ES, NQ and EC. In my opinion there are so many stocks out there that just trying to guess where to start is a huge task. With the indexes, there's only so many to choose from.
2) http://www.elitetrader.com/vb/showthread.php?s=&threadid=74366 In that thread, the 3rd post down, I gave some book ideas.
3) Be ready to lose. You asked if 1k up to 10k was a good level to start at and I think that 10k is WAY to low. You are going to blow thru 10k in no time. Consider it 'cost of admission' or your 'tuition'.
4) Check the CME and CBOT website for some great, free educational materials. If you do enough searches on google, you will find A LOT of free stuff. See what interests you and then narrow it down.
5) Keep everything realistic - making $5k on $10k PER month is not even close to realistic. Let's say you got lucky and pulled off a +3% in your first month. That is a whole $300 pre-tax on $10k. That again is why I said what I did in point #3. Starting with too little money and expecting way too much from that will destroy your confidence real quick.
6) It sounds like you are planning to quit your current job and trade. Good for you, I did something similar; however, get as much studying in NOW - nights, weekends, etc. You have to view this as a full-time job, not a get rich quick plan. Get ready for people to tell you that you are nuts for leaving your $5k+ per month job to be a trader.
7) Be ready to spend money on books, cd's, seminars, etc. In the beginning, you will be looking for the holy grail that does not exist. And all of us here will tell you it does not exist, but you will still keep looking for it.
8) Keep away from the infomercial crap. Also keep away from bigtrends.com - they are terrible.
9) Get a paper trading account opened ASAP and start having at it. Think you just 'know' SIRI is going to pop now, then buy it. See how it goes.
10) Lastly, do not be afraid to go Short. I don't know why, many newbies won't even think of shorting and leave A LOT of $$$ on the table in the process. If you can only make money when the market is going up, good luck. In futures, shorting is extremely easy and very profitable when you are right.
Good luck and maybe consider starting a journal here and you may get some feedback. Just call it something like "Newbie journal, expect stupid sh*t to happen here".
PS
Please use the search feature as well on ET. There's a lot of great posts here when you find them.
LOL, wait till Cheese gets a hold of this thread
--
Tampa
I've been trading since January of this year. I swing trade stocks only, and from time to time might make a dollar, but there are somethings I've learned with each dollar lost:
1. Find ONE MARKET and focus on that market only.
Dont jump into every market thinking you'll make 2x.. 5x as much money because you wont (at first).
2. Start off with stocks or maybe forex.
They (stocks) dont move as fast as futures do.
3. Know your trading style.
Scalp, swing trade, position trade. Find one that fits your goals and life style. go to www.investopedia.com for more info or dial 1-800.. lol
. I find swing trading to be the perfect balance, but it can be very boring sometimes. Also dont think you have to know everything about trading to make $$. I dont know jack about reading the tape (time and sales screen) or Level 2, but I can make a couple hundred $$ a week. Your style will also determine what stocks (if thats what you choose) you trade. For example a scalper would not try and scalp GE (General eletric), but it would be worth looking at if you position trade (hold for a couple months)4. Get a good broker
Your broker should reflect your trading style. I use Scottrade and pay 7.00 both ways. I dont mind because of my trading style, but a scalper would rather jump off a cliff than pay 7.00 a trade when you make 10-50-100 trades a day. IB (interactive brokers) and MB seem to be popular.
5. Avoid the news
I'm still trying to figure this one out, however some will tell you to avoid the news and just trade the technicals, and others will say to fade (short) the news or go long under certain conditions.
6. Learn to short
Learn to play both sides of the market with equal ease. Shorting is more risky, but dont let it scare you. In fact I find shorting more fun.
7. Money
Again your trading style will determine how much you need to start. 5k I think is minimum if you trade stocks at a prop firm, 25k to day trade retail (at home). I have about 15k cash and another 15k margin, and it works fine for me however 30k is crap when scalping google
. 8. Keep a journal
I have a journal of all my trades in this order:
1. date
2. action (buy / sell/ short/ cover)
3. # shares
4. Stock traded
5. Price
6. Stop
7. Gain/ loss
Then I write down a before and after summary of my thoughts, and a chart showing entry and exit after each trade. I also write down the close price for the Dow, nasdaq, and s&p each day. Your journal will be a critical part of your success!.
9. Ignore Elliot wave theory
Read some threads here on ET. Most will tell you its garbage. I dont use it either.
10. Take everything posted on ET with a grain of salt.
In general...good advice. Trading futures is the hardest game you'll ever love. I know great traders that can't make money trading futures. (At least day trading!) Trading futures on a longer term basis, 30 minute, 60 minute or greater offers the best risk/reward, and will help you minimize your transaction costs.
The challenge is that to do this for a living, you either need lots of money and focus on gettting a good return on less trades, which means greater intraday, daily variance, and monthly variance, or you need to make lots of short term trades, exploiting small edges and using lots of intraday capital. The latter offers less variance, but your transaction costs go up as a % of revenue, and finding short term edges is very challenging. You'll look at 100 ideas to find 20 that look good, to find 2 or 3 to actually monitor, and one to trade.
Good luck, trading is a wonderful career. No other job like it in the world.
The challenge is that to do this for a living, you either need lots of money and focus on gettting a good return on less trades, which means greater intraday, daily variance, and monthly variance, or you need to make lots of short term trades, exploiting small edges and using lots of intraday capital. The latter offers less variance, but your transaction costs go up as a % of revenue, and finding short term edges is very challenging. You'll look at 100 ideas to find 20 that look good, to find 2 or 3 to actually monitor, and one to trade.
Good luck, trading is a wonderful career. No other job like it in the world.