quote: There is no way Don is going to give out the real stats, Bright's bread and butter is about sucker people in with their 25K's and if he is telling the truth then there wouldn't be a business. Just when you start making some sense, and show some sensibilities, you go blowing it again. We turn in our numbers to the SEC, and they are made public in our trader orientations. If I made them public in a forum like this, then it is considered advertising, which is not allowed by our regulators. That's all there is to it. Our business model works well for the traders, and Bright Trading is continuing to grow daily (which we couldn't do if we were "suckering" people in). Remember, we are playing in the same game, and should all get along.
Just a note. This is one of the toughest trading environments I have seen. A bear market,no momentum and .01 spreads make this a very challenging environment even for seasoned professionals. As a general rule, I would estimate one out of ten will make it as a short term trader in this environment and one out of 20 will make a very good living. If market conditions improve , the statistics will improve. If traders last the first year, the success rate will be higher. I think that is why there is no easy answer to this questions. Our top traders are still making a good living, though they will not make as much as they did two years ago. Stock Trading is a very hard business to be successful at. Even though stock trading is hard, it is one profession you can enter with very little capital to start. If you follow the advice of pro firms, (start small and trade larger size as your trading improves) you will have a greater chance of success. If you wanted to open up a Subway sub franchise, it would take a lot more than 25k . If you wanted to Buy a TAXI Medallion(license to drive a yellow cab in NYC) , it would cost you $250,000 ! To open up a resturant in any major city would cost you a minimum of $250,000 . You would have a very high overhead and your success rate would be no better than a stock trader. Traders must adjust their stock trading with market conditions. I don't think is is fair to say that pro firms are looking for new traders to lose their funds in order to generate commissions. Pro firms success comes from profitable traders who earn a good living trading! Gene Weissman Lieber & Weissman Sec., L.L.C. gweissman@stocktrade.net
I couldn't agree more with you! I have been trading for 4 years now. First year I made a salary comparable to an entry level position in a decent firm. Two years following that I've been in the lower six figures. This year however is the toughest trading environment one so far in my trading carreer. So if you are considering becoming a trader right now, you are up to a helluva battle. At the moment everyone I now, except a very few, are barely hanging on, only getting enough to pay rent and food. So if you are a novice wanting to get into the game, forget it! Timing isn't right for ya. Except if you have saved up for a year living of course. ....
So, you would suggest a person wait it out??? In my case, go back to the institutional world for a while, then when things improve go back to prop trading? That's an option I've entertained....
Hitman, Thanks!! You tell it as it is! Again, thanks for the 1)realistic stats of success/failures at worldco. 2) words of encouragement and determination. You have rather steely determination, which is admirably. I've been thinking about it and I think it comes down to this: 1) Give it another 6months try 2) Go back to the institutional world and never look back again 3) Go back to the institutional world and once conditiosn improve go back to prop Now, that the choices are clear. It's a matter of which one I'll select... I still LOVE to trade. It's one of the funnest, challenging, rewarding, and frustrating thing I've done. It's just how deep will I have to dig to summon up that grits to continue at it when the "opportunity cost" is relatively high for me. That's other competing opportunities have immediate payoffs(i.e. salaries,bonuses, benefits,etc.) That's the eternal question: short-term satisfication vs long-term POTENTIAL greater success... I don't want decades and decades from now when I'm no longer young and thinking I was just 5ft away from success but I stop to go the safer route... Or it could be I saved myself of years of misery and meager earnings.. haha. who knows... who knows... trader99
Hi Trader99, Sometimes when one asks questions, one only seeks confirmation to a decision he has already made. From your posting, I sense that you are ready to go back to a steady job with benefits. There's absolutely nothing wrong with that! People are built differently. The truth is, if you made much more than 100k a year at your desk job, you probably won't reach that level at a prop firm for another 3-5 years (best case scenario, assuming that your skills are maturing every year)... If you are capable of commanding a high salary, I would consider this: Go back to a steady, high paying job. Save up TONS of money (live frugally!). Wait until market conditions get better... And then use your capital to trade longer-term in the markets. I don't trade for a living, but here's what I've learned. When the market is chugging along (raging bull market, for example), anyone can make money, using really any type of method. The trick is keeping all the gains when the party is over. Basically, just make sure you have enough capital and technical savvy when the conditions are right, and then go for it full-force! Personally, I would love to daytrade professional, because it's "fun." However, I'm starting to realize that if I were more disciplined and take a longer-term perspective, I may actually make more money... But this is totally blasphemous on a daytrading board, so just ignore that sentence, haha!
The only problem with Wycoff (above) is that he doesn't really trade, and admits that he makes his money do other things. I I happen to agree with his objective evaluations of a potential trading future, but for different reasons, and from a different perspective. It is easy to say what cannot be done, how many don't make it, how many lose money, etc., and I don't try to "sugar coat" the profession. It's not for everyone, but everyone sure "wants" it to be...the few "entrpreneurs" out there will do fine....and since most "jobs" are being eliminated (almost daily, it seems)...this is still a good opportunity, percentage wise. Compare this to virtually any new business, and we will compare very well. If, in fact, you have a good, long term position with someone who won't lay you off...then I say stick with it, trading will be here for a long time.
Yes, I know Wycoff does other things as his livihood. I'm sure that's a good hedge for him as well as others in the newsletter/advisory services,etc. taht dont' actually put money on the line. hehe. I know your point about the jobs elimination/layoffs. But that's typical in an economic downturn. There are booms then there are bust then booms again. Not everyon should quit whatever their profession is and daytrade just becasue the "market will always be there". I'm not saying I don't like to trade. I love to trade and still think I can do it on a full-time basis and get an OK living(not a super livning, but OK). But for now, I'm still deciding if that's the best paths. Because long term, I still want to trade maybe after some time of more financial stablity. But I'm just saying that people should NOT be stretch "thin" or betting the entire wad, or God forbid use money they don't have to do this prop trading(i..e take out a credit card loan! doh!) just because they think with just $25K starting captial or whatever capital that's required by various firms(Worldco,ECHo, etc.) that they will generate enough income to live right away. That's where the danger arises... trader99
cclee, THANKS for responding and somewhat reading my mind. hehe. It's probably not a bad idea to go back to the institutional world with more stable income streams for now and build up a "tons of money"(as you put it so well. hehe) then go back to prop trading and get the 95%-100% deal from Worldco/Bright/ECHO or whatever. cclee wrote:"The truth is, if you made much more than 100k a year at your desk job, you probably won't reach that level at a prop firm for another 3-5 years (best case scenario, assuming that your skills are maturing every year)..." That's the scary part. It's liek backtracking for 3-5yrs. I was hoping to get to that level in 1-2yrs at most. perhaps i was being unrealistic?? But then again, I'm thinking of a different form trading. It would be nicer if these prop firms don't just focus purely on intraday basis. A vast majority of people from the isntitutional world usually have much longer time horizon(except for the floor traders,specialists,MMs). So, they like to put on larger positions and holding it for longer time frames. So, let's say a typical size 10,000 shares of IBM for a mere 10pts move in maybe 2-3wks is a 100K. But that's not typical holding period for prop firms if i'm not correct?? Again, for pointing out the real meat of this conflict. trader99