Why do people believe day trading will get them rich quick?
- Thread starter emg
- Start date
Evolution in many - if not every - fields of life (science, society, business, sport, etc) starts with dreams and ridiculously small probabilities of success. If we had to only take the sure paths in life we'd probably be having this discussion in a cave. And it wouldn't be about stock trading but flintstone trading.
I need newbies money.
In the late 1990's and early 2000's...there were more newbie traders thinking they could get rich or at least make a 6 figure income soon after starting their careers as a day trader.
However, I've seen more newbie traders in forum discussions (especially here at EliteTrader.com) after the financial collapse of fall 2008 talk about 5 figure incomes or income to pay the bills.
Thus, things have changed in the recent few years in comparison to the 1990's when day trading was popular. In fact, I haven't seen one single message post here at Elitetrader.com in the past two years where a newbie trader talked about coming into this career to become rich...not one message post.
Seems like the financial collapse gave a reality check along with problems in housing and unemployment. That's why there's been a smaller number of newbie day traders these past recent years in comparison to the years before 2008.
My point is don't worry about the newbie traders today because they seem to be more cautious or more realistic than those before them in the 1990's or early 2000's.
Here's another reality check, a serious day trader is really like someone starting a business of their own (entrepreneur). Usually most business owners do see themselves as doing something that's more than just about money...something that they hope will allow them to achieve goals in life and become more financial independence in comparison to whatever they were doing before.
However, like any other new business...most will fail.
Last of all, I notice you seem to have a deep concern about newbie traders because of other message posts you've made here at Elitetrader. Just remember that we need these types of traders in the markets. Don't you want them on the other side of your trades. Another way to put it, less newbies in the market or newbies that are smarter...trading becomes a little more difficult for us veteran traders.
Mark
If you are a daytrader, and you are worrying about newbie traders, then you better stop daytrading, because do you really think you take money away from the institutions ??
Trading is absolutely nothing like running a small business.
Anyone who claims this is delusional, naive or trying to get your money.
I'll bet that anyone who says this is either. A noob, author or vendor.
Anyone who claims this is delusional, naive or trying to get your money.
I'll bet that anyone who says this is either. A noob, author or vendor.
I guess that depends upon if trading is a hobby to you or a business to someone else (e.g. IRS, tax accountant, bank loan officer, contract agreements, exchange seat etc cetera).
My old man was a floor trader for several years and he sure in the hell didn't write down on his income tax return...hobby.
Seriously, if you don't watch your overhead costs (commissions, data fees, equipment costs or any other expenditures), protect your trading capital while trading...all those things that Mom & Pop store down the street are trying to do for their small business whatever that may be...
You'll be a mess around income tax time and most likely not in business too long after-wards unless it's just a hobby to you.
Therefore, treat your trading like a business and you'll be ahead of most (those that think it's a hobby).
P.S. Don't forget your office area in your house that you use for trading is tax deductible unless you're really not a trader or don't take it serious as a business. Call your tax accountant for more info.
Mark
I'm not a noob.
I am an author (soon to be published).
I am working on my training materials and plan to be a vendor soon.
So, here goes.
Like running a business, trading requires will, focus, discipline and money management. I've owned several businesses over the years including three at the moment, so I think I can speak from some authority.
The thing is, to be successful at anything you need will, focus, discipline and money management.
Before deciding what is required to be successful for yourself, talk to a bunch of successful people and see what skills they exhibit.