What are realistic goals for an 18-year old swing/position trader?

Quote from HolyGrail:

Take your 1500 and place it in a good mutual fund. Paper trade for your 4 years in school, or just donate it now to a good charity.
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This advice sucks. Here is my opinion -

I've been trading through college (just finished 3rd year) and the experience you get by trading your actual money is invaluable. Not only would I not be able to bring myself to apply any effort if theres no money on the line, trading your own money teaches how to deal with the different emotional states that arise... from the wins, the losses, the "stuck in a position because your platform went down" situations and all of it. There is no substitute for experience.

You should have more than enough time at school to put on stock swing trades. Making a consistent 2% per week is a pipe dream (mostly just the consistency part), but hey its all good... thats what its all about- learning the challenges. If you find yourself wanting to be more active in the markets though, I'd recommend day trading index futures. It takes a huge investment of time in order to become profitable (at least in my experience) but you can generate some pretty awesome returns due to the leverage. Its pretty fun making $100-$200 on average from a half-days work trading 1 NQ contract when your friends do work-study for $9 an hour. :)

Good Luck
 
hey,

being 18 and already knowing the lingo is a pretty good start I'd say. practice makes perfect. I started out trading about 8 months ago by blowing up a $500 dollar tradeking account in 6 months, now I trade forex and have gotten pretty profitable.

Given your knowledge of technical analysis stuff, it sounds like you might like intraday scalping type trading. Assuming you use a strict risk-reward ratio and watch out for event risk, you can do pretty well for yourself using technical analysis trading forex. It's time consuming, but you could trade it while you do your homework since forex goes 24 hours. Anyhoo, I hardly know anything about trading but I have found a system that is working for me, so I hope you do too.

good luck!
 
I used to trade when I was in college and it was probably the best thing I ever did. It hurt my grades, I lost money, and I didn't party as much. BUT! I put on my resume under activities that I was currently trading e-miNY futures and now I work at an oil company in the gas and power trading unit.

It is very hard to manage p&l swings, studying, and alcohol but you will learn tons along the way. Do not do it if making money is the only goal becase I am willing to bet you will lose that $1500 and you will have to reload. probably multiple times.
 
Quote from TraderGreg:

I meant $5 per entry and exit for a total of $10 - so it would be about .66%. I will likely start with swing-position and then move toward swing to get around this a bit. Taxes are my main concern, as I have figured it to be the difference between 11,000 and the 75,000 if I would have to pay 50% on it a year.
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The commissions are going to kill you before you get a chance to worry about the taxes. If your going to be in college, working a job and trading you should focus on longer term ideas so that you at least have a chance. The market does not havet he volatility in it that it did 10 years ago. Also, making 2% per week on a small account is reasonable enough, to assume your going to compound it out like that for four years is not.
 
TraderGreq,

First of all, best luck in your endeavor, it's always great to see somebody young, ambitious and determined.

FWIW, I suggest you consider the following (not that you do it, but that you think about it and see if you might want to make some adjustments to your plan):

1) This summer, forget mostly about trading, get a job (or two) and while you're staying at your parents (I guess you are) save as much as you can. 1,500 is nothing, you don't need a hundred grand to start trading, but simply saving another 1,500 quadruples (not doubles, mind you) your chances of staying in the game (read Van Tharp or somebody else on the risk of ruin and position sizing). If you can save some significant amount (say 10,000) then put half in your trading account and the other half in a savings account (in case you blow up your first account - it's happened to the very best).

Working and saving instead of studying and trading might sound shitty now, but it is way much better than having to start saving again in your sophomore year when you have only 300 left in your trading account (not that this will happen to you, but that you want to be prepared in case it does happen to you - again, it's happened to the best, if you don't believe me ask Livermore's ghost).

2) Make a 3 year curriculum/syllabus for your trading starting from the general (going a mile wide at the beginning was really smart) education and then proceed to go deeper and deeper in the fields you like the best, while covering the bases in the rest. Keep open spaces for things you don't think you need to learn now and for things you don't even think you are supposed to know. Combine theory, testing, paper money practice and real trading.

3) As soon as you can, get an internship in a trading firm either part time during the school year or in the summers. Don't take no for an answer. Know thy enemy.

4) Try taking a few extra credits every semester and the odd course over the summer so that your senior year is so light on courses that you can basically trade full time (that one year will be way more valuable than putting a few trades in and out between classes for 4 years).

5) Make sure you take a couple of vacations every year and never miss an important college event for a trade: there will always be more trades, booms and crashes, but some of the experiences and opportunities you will get in college will be once-in-a-lifetime (or so) experiences. Not trading a few days a term will delay your way to becoming a millionaire a month or so, but you'll be way richer.

6) Use a trading simulator where you can record and replay the trading sessions (at x2, x4, etc if you want to) so you don't have time gaps in your accumulated experience due to your schedule.

7) Don't worry about whether you end up college (or, if you follow number 4, your junior year) with 70,000, 700,000 or 7,000, just make sure you trade (and live) well and con-sis-tent-ly.

Last but not least, write down the names of those who've given you some advice and when you're filthy rich write us a check. ;) lol - just kidding.

All the best - man, do I envy you!
 
I agree with this last comment.

It is clear to me in hindsight that young traders like yourself with little capital are usually going to lose it (all of it)

Really it has nothing to do with intelligence, and all to do with experience. Frankly that is something you can't obtain by studying.

Looking back on my own experience as a younger person, I did not really listen to the good advice thrown my way....Perhaps you will, perhaps not. Enjoy the ride either way and learn as much as you can from it.

Good luck
Steve
 
Quote from Sarvise:

TraderGreq,

First of all, best luck in your endeavor, it's always great to see somebody young, ambitious and determined.

FWIW, I suggest you consider the following (not that you do it, but that you think about it and see if you might want to make some adjustments to your plan):

1) This summer, forget mostly about trading, get a job (or two) and while you're staying at your parents (I guess you are) save as much as you can. 1,500 is nothing, you don't need a hundred grand to start trading, but simply saving another 1,500 quadruples (not doubles, mind you) your chances of staying in the game (read Van Tharp or somebody else on the risk of ruin and position sizing). If you can save some significant amount (say 10,000) then put half in your trading account and the other half in a savings account (in case you blow up your first account - it's happened to the very best).

Working and saving instead of studying and trading might sound shitty now, but it is way much better than having to start saving again in your sophomore year when you have only 300 left in your trading account (not that this will happen to you, but that you want to be prepared in case it does happen to you - again, it's happened to the best, if you don't believe me ask Livermore's ghost).

2) Make a 3 year curriculum/syllabus for your trading starting from the general (going a mile wide at the beginning was really smart) education and then proceed to go deeper and deeper in the fields you like the best, while covering the bases in the rest. Keep open spaces for things you don't think you need to learn now and for things you don't even think you are supposed to know. Combine theory, testing, paper money practice and real trading.

3) As soon as you can, get an internship in a trading firm either part time during the school year or in the summers. Don't take no for an answer. Know thy enemy.

4) Try taking a few extra credits every semester and the odd course over the summer so that your senior year is so light on courses that you can basically trade full time (that one year will be way more valuable than putting a few trades in and out between classes for 4 years).

5) Make sure you take a couple of vacations every year and never miss an important college event for a trade: there will always be more trades, booms and crashes, but some of the experiences and opportunities you will get in college will be once-in-a-lifetime (or so) experiences. Not trading a few days a term will delay your way to becoming a millionaire a month or so, but you'll be way richer.

6) Use a trading simulator where you can record and replay the trading sessions (at x2, x4, etc if you want to) so you don't have time gaps in your accumulated experience due to your schedule.

7) Don't worry about whether you end up college (or, if you follow number 4, your junior year) with 70,000, 700,000 or 7,000, just make sure you trade (and live) well and con-sis-tent-ly.

Last but not least, write down the names of those who've given you some advice and when you're filthy rich write us a check. ;) lol - just kidding.

All the best - man, do I envy you!
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This has been some of the best advice I have had, and several different people have suggested to me that I get an internship at a trading firm. Since my current major is business management (although I'm planning to take enough finance classes that I will likely get a second major or minor out of it anyway), and I am already dreading a business internship away from trading, I think an internship at a trading firm could possibly be the best option I could have.

However, I am not extremely familiar with trading firms. I am aware that certain hedge funds allocate small portions to day trading, but all in all I don't know about much. Can you give me examples of trading firms, so I can look them up and find out more?

Also, in regards to waiting until I have at least $3,000 instead of $1,500:
Would I not be better off keeping just my part time job and focusing on trading? That way I may only raise my funds up to $2250 or so, but I could even program a trading system that makes about 60% a year, raise the money that way, and still keep a solid block of my time learning and trading in a paper account. Even this way, if I fail trading entirely I can just put a few thousand in my trading system a year (assuming I have a non-trading job) and end up living strongly once I hit about $100,000 in my account (at 60%, it wouldn't take long) and focus on investing (god forbid).

Any thoughts on this? Thanks!
 
Try to strike up a connection with ofurbaldur; then you will have two things:

1. A way to spent only a few minutes a day on trading.

2. A way to make many many times the money you would be making if you followed your current path and the advice you have gotten.

People do not have to work for a living these days. Money as a commodity may be used in place of doing a job.

You do know how to write the compound interest formula but it has not occurred to you to have a method of compounding. (See what you have written and responded to.)

For humor read "The Predictors". Once you get a copy I will list 32 references in it that are jokes that the author did not recognize the characters in his book were doing to screw up mentally and otherwise.

There is a thing in the financial industry called Conventional Wisdom. It is where all the myths you have been witnessing come from.

you need (a strong word) to get out a few charts and see just where what ofurbaldur suggested to you. If you connect with him and you have a few charts looked over, then you can get on with building your mind in a cogent manner.

You might ask some one you know if there are consequences of making decisions. That person will explain to you how it all works.

I had the priviledge of going to college because the US Navy applied to colleges for me. Then for heatlh reasons, I couldn't pass the Navy physical. I wrote a letter to the school that had admitted me and told them I was declining. They gave me a job, then two jobs, then three jobs so I could make ends meet on my own. My parents were against my going into debt, personally. When I graduated from high school I was on my own.

When I got a couple of degrees, I started plotting charts with a pencil. Making money is done by taking what is offered. Charts depict what is offered. ofurbaldur, I imagine, will tell you how it all turned out. I don't know who he is but we have had the same experience, at least.
 
several different people have suggested to me that I get an internship at a trading firm. Since my current major is business management (although I'm planning to take enough finance classes that I will likely get a second major or minor out of it anyway), and I am already dreading a business internship away from trading, I think an internship at a trading firm could possibly be the best option I could have.

However, I am not extremely familiar with trading firms. I am aware that certain hedge funds allocate small portions to day trading, but all in all I don't know about much. Can you give me examples of trading firms, so I can look them up and find out more?

Also, in regards to waiting until I have at least $3,000 instead of $1,500:
Would I not be better off keeping just my part time job and focusing on trading? That way I may only raise my funds up to $2250 or so, but I could even program a trading system that makes about 60% a year, raise the money that way, and still keep a solid block of my time learning and trading in a paper account. Even this way, if I fail trading entirely I can just put a few thousand in my trading system a year (assuming I have a non-trading job) and end up living strongly once I hit about $100,000 in my account (at 60%, it wouldn't take long) and focus on investing (god forbid).

Any thoughts on this? Thanks!
 
1. Read, read, read books on investing....

2. Try to get an intership or job in the investment world so you learn about the industry and get some experience.

3. If you have money feel free to open an account with a cheap broker (i.e. TradeKing) and trade extremely small sums of money. I recommend you "swing trade" (take positions for days or weeks rather than trade aggresively such as day trade and lose your money on commissions. If you have $1,500 then def swing trade with only one position. The less money you have, the less successful percentage-wise you will be essentially.

***Learn as much as you can. Study the market during its open as well as during its close.

Good luck...Take risks, be brave, but be smart about it.
 
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