Hello everyone, This forum has lots of great information. Here's my question: I'm 19 years old and have been wanting to get into the market for quite some time now. I have about 11-15k roughly to begin trading, however I was thinking that I should start off "Swing" trading before I even think about day trading. 1) For all you swing traders, should I use a online broker like Fidelity, Ameritrade, or E-trade or should I use a direct access broker like cybertrader? I've been reading the book "Japenese Candlestick charting techniques" to understand how to read charts, find trends, and support and resistance lines (interesting stuff). 2) What other types of information should I consume before I jump in?
Ok, I'm 18, and about to turn 19. First off, anything less than 30 to 40k, you are not going to be able to do trading of stocks. There are too many disadvantages. First off, you have to have 25k to daytrade. One rule that prevented me from being a stock trader. Second off, taxes on stocks are insane. Commissions on stocks are also somewhat harsh unless you have a good broker. Instead, a strong suggestion is to go to Futures. With Futures, you could open an account with as little as 2k, and you can trade to your hearts content. YM for example, each tick is worth 5 dollars. It's good if you can trade, it'll kill you quickly if you can't manage risk or control emotions. But unless you have 25k, you can not day-trade stocks, and I wouldn't even bother without 25k, unless you are specifically doing trades that are longer than a day each. Just my advice, but hey, I'm only 18, so what do I know? EDIT: Using a Direct Access Broker is pointless, again because you don't have 25k, and therefore, can not do the required volume to keep the platform free, so it is very possible you'd be losing money. Again, either save up so you have around 40 to 50k to trade stocks, or start out with 2k, in a futures account. I'd recommend www.greenstreet.com. 4.30 commissions, and hidden fees or anything. If you are going to be daytrading, your only option is Futures, or Forex.... maybe Options, I don't know anything about those though. So do your research, and realize, that there is a chance you will lose all of that money, so only be sure to get started if you are willing to accept the fact that you can lose all that money, and the markets can prove you are not trader material. EDIT: If you do decide to trade stocks, you will be swing trading, and don't get a Direct Access Broker. Do not go to E-Trade, they WILL screw you over just like me and many many others. Scottrade maybe. I have Ameritrade, but not happy with the platform. Genesis Securities is the one I have been looking at, you should call them up and see how that works, but again, they may require day-trading to avoid platform fees or whatever it is they got. Just letting you know all of this from personal experience. I have lost money, so hopefully I can help you not lose money, but the best education you can get about trading the markets, is just going out and doing it. I was very fortunate to get a full-time mentor and he teaches me and a few others for free, and not many people will ever have that chance, so keep that in mind as well. But here are a few questions for you, so maybe others, or myself can help you: 1. What do you want to trade? (Stocks, Futures, Forex.... anything) 2. How often are you going to trade? (Every day, all day long, part of the day, any restrictions) 3. Are you going to day-trade, and if so, you do realize that for stocks is 25k requirement? 4. What is your main goal from trading? (Looking to do this as a career, or just something as a side job or what) 5. Any previous experience in any trading market? I think if you answer those, that others can help pinpoint what would be good for you. I again, must suggest futures, but realize that the reward is far greater than trading stocks, but the risk is also many times higher as well. Do your research, and read about the markets.
I believe he asked about swing trading...not daytrading. In such a case, the 25k barrier is not involved if [The NASD definition under rule 2520, defines a pattern day trader as "any customer who executes four or more day trades within five business days, provided the number of day trades is more than 6% of the total trades in the account during that periodâ.]
Well, he asked if he "SHOULD" start swing trading... meaning he possibly has an intent to day-trade. Just making that clear.
1) Find a broker you are comfortable with as far as service, information, reliabilities,fees... all have a different combination of each. 2) As much as you can...my advice is that when you "jump in", you should feel that you have the ability to teach a full course on whatever style trading (swing trading, day trading, TA/FA) you will be doing AND a seperate course on the type of trading (equities, futures, options, etc) -R.T.
I think the choices generally are: 1. Put up 5k and try you hand at a prop shop. 2. Start with 100 share lots with a retail broker like tradestation ($1 for 100 share orders). 3. get at least an undergrad business degree from a high ranking business school and try to get a paid trading job
Also one great suggestion that I just thought of. If you have never traded anything. Be sure to get yourself a simulator and trade. Do this for at least a few months. Some people argue that it is a completely different ball game once you start trading with live money, and I will admit, when I first switched to live money, emotions got in the way, but now that I have overcome that, I don't feel it has any significant differences. So I strongly suggest that no matter what anyone tells you, that you get a simulator and trade with that. I know a lot of simulators for Futures that you can try, and I can get you that info if you'd like. For stocks, well, I think you will need to fork out some money to do this. Also realize you want a good data feed and charts. I use eSignal. It is expensive, around 180 a month, but it is beyond worth it because it helps my trading. If you have crappy charts, then your going to get a crappy view of the markets. So take that into consideration as well. Interactive Brokers, and Tradestation securities are two other brokers I forgot to mention. I don't have experience with either of them, but I know a lot of people enjoy them. Again, call them up and ask them for a demo, and I'm sure they can arrange something. EDIT: Szeven is also right. A prop shop might be in consideration for you. I can't comment any farther on that as I don't have any personal experience. But even I am going to continue college education. Lucky for me, I can attend online classes, so it works out really well. So, again, no matter what anyone tells you on here, just realize that it is your money, and you are risking it all, and it is not easy, and even I can't claim success, but all my hard work and sticking to it is paying off. If you really have the determination to do well, then all your hard work very well could pay off, or it could just me the most expensive education you will ever have, and hopefully you can benefit from it later on.
lol...if you want to make it clear...then technically he only asked what broker(s) is good for swing trading
spend time on learning how to spell ... so in case you decide to send a resume to a trading firm they won't trash it right off the bat. ps ... as much as mr JM is trying to help you understand that he is roughly your age and still a newbie trader ... perhaps some more reviewing of ET posts and threads on your behalf will lead to some insights ... sorry to say it will not be easy as there is alot more "trash" and "trash talk" here than yrs ago on ET ( in my opinion ) -I've been reading the book "Japenese Candlestick charting techniques" to understand how to read charts, find trends, and support and resistance lines (interesting stuff).-
"2) What other types of information should I consume before I jump in?" I think he wanted more information.... which we are providing... let it go man... lol.