What approach should one take when starting day trading?

[Xela]

Day trading is a no go

The chart is a random.

There is no different between a casino and day trading.

both camps (revert to mean vs momentum) are losers when you include commission + slippage

Why is that the less well-informed and the more prejudiced people's opinions are, the more forcefully and repeatedly they typically express them?

 

[Robert Morse]

My approach to trading is to keep an open mind and allocate to what works. If someone shows me they can make consistent risk-adjusted profits from watching the cycle of the moon, I'm in. I don't really care where they get their edge. Bashing other's techniques, that work for them, is not productive or helpful to others that are trying to learn. I say learn a little of everything and apply what works for you. For me it was delta neutral volatility market making. When the edge was gone for locals, I left. 25 years was a good run. They edge was gone by 2010, maybe as earlier as 2005, but during the financial crisis, we did not require locates, which was a big edge with financials.

Even though my focus was on option pricing, I did watch charts all day and follow the news and financials of the symbols I made markets in.

 

[galvinlee888]

My approach to trading is to keep an open mind and allocate to what works. If someone shows me they can make consistent risk-adjusted profits from watching the cycle of the moon, I'm in. I don't really care where they get their edge. Bashing other's techniques, that work for them, is not productive or helpful to others that are trying to learn. I say learn a little of everything and apply what works for you. For me it was delta neutral volatility market making. When the edge was gone for locals, I left. 25 years was a good run. They edge was gone by 2010, maybe as earlier as 2005, but during the financial crisis, we did not require locates, which was a big edge with financials.

Even though my focus was on option pricing, I did watch charts all day and follow the news and financials of the symbols I made markets in.

Not against learning new things.

The problem is the day trading hype or gold rush marketing. The day trading is clearly benefit the broker, education seller, bucket shops, signal seller, day trading website owners,market making and etc due to the way how the day trading is been structured (commission/slippage and etc) and marketed. The normal day trader will be the losers in this game.I am expecting I will see more "professional" paid posters to rebut this claim. This is not different than the casino try to sell the millions dollar dream to the gamblers.

 

[Gotcha]

If someone shows me

Exactly right. What we have here at ET these days though is people going on and on about what they think, or how they supposedly do things, and given that everyone is just using an alias, the written words they use carry absolutely no weight. Its far too easy to even say the right things and still be a hopefully lost trader, or even pretend to be a trader.

I wonder though if you are in a position to see things more clearly. Having access to actual trades is the only way to verify anything when it comes to trading. I'm not sure what the regulations stipulate, but are you able to look at accounts and see patterns with regards to trading style and profitability?

 

[lawrence-lugar]

Day trading, or just Trading in general, reminds me of the crazy 2007-2008 Housing mortgage Market boom and bust -- Many will fail ...and it attracts the relatively dumb/poor vulnerable crowd;

But everyone is susceptible, no one is immune -- it's like death and taxes.

 

[Robert Morse]

I look closely at any client looking to raise money for a future hedge fund or to offer SMA, not the average account. I can tell you that in my futures account, I have allocated to two ES day-traders, not great so far. One I closed down in 2/2016 and one is down a little after 2 months. Not bad, but not good.

 

[Gotcha]

I look closely at any client looking to raise money for a future hedge fund or to offer SMA, not the average account. I can tell you that in my futures account, I have allocated to two ES day-traders, not great so far. One I closed down in 2/2016 and one is down a little after 2 months. Not bad, but not good.

Thanks for the info. Can you please verify if I understand this properly? You say that you have 2 day traders trading your own account, and one account was closed down in Feb of 2016 and the second account is down after 2 months? If you don't mind saying, is this an agreement that you entered into perhaps with something like a prop shop setup in that they would trade and the profits would be split? Were they profitable in SIM prior to going live or did you have some way to verify their ability prior to letting them trade your account?

Seeing actual trades is what I find most useful, and this is precisely what ET lacks. Its not even about trying to follow someone's trades, or reverse engineer their strategy, but simply to understand what they are doing. Often times, what people even say and do is completely different. Guys on here might have good intentions of wanting to help, dropping random trading hints or rules, but in their own trading, they more than likely don't even trade like this.

This is exactly why I think most of what is said on here is useless. Just like a picture is a worth a thousand words, trade entries and exits say so much more than paragraphs of supposed trading help. Instead of million threads calling for market tops, lets just wait for the guy who shorts and says where his stop is. If someone made just 10 trade calls, I would be more inclined to listen to them than someone with hundreds of posts and not a single mention of an actual trade.

When I was brand new, I was amazed by all the "knowledge" shared here. But all that this reinforced was the desire and need to be right about a particular trade. If I actually saw a string of trades, will easily half of them leading to a loss, and yet the trader still showing great profitability via trade management, it would have put me in a completely different frame of mind. So when I come across a trader on here who just talks and talks about how they analyze everything to death, I really have to wonder if they actually trade because there doesn't seem to be any mention of what to do about the many trades that don't work, which is what happens when you're actually trading live.

 

[bashatrader]

I'm interested in the DAY Trading. What tips and advices can one suggest for someone who has never touched that industry.

1. Formulate your system

2. Backtest it in a suitable platform (NinaTrader, MetaTrader, Quantopian, etc.)

3. Can you live with the risk parameters and return? Does it worth the time?

4. If you think it does, trade the system with reduced risk for about 6 months.

5. Do actual results match expectations? If not, have to rethink whole approach.


Good luck

 

[Robert Morse]

I have a futures account at Wedbush with a master/sub structure which I have allocated toward 4 CTAs that each trade in their own sub account. I see all trades the next day from post trade allocation, not live. The ES day-trader has a notional $100k allocation has trades between 1 and 5 ES contracts at anyone time. There are also days he does not trade.

I have 2 clients that have allocated towards a few managers I introdcued them to. They are mostly option sellers.

Bob

 

[Gotcha]

I have a futures account at Wedbush with a master/sub structure which I have allocated toward 4 CTAs that each trade in their own sub account. I see all trades that next day from post trade allocation, not live. The ES day-trader has a notional $100k allocation has trades between 1 and 5 ES contracts at anyone time. There are also days he does not trade.

I have 2 clients that have allocated towards a few managers I introdcued them to. They are mostly option sellers.

Bob

Thanks very much for the additional info.