I'm sure after I give you exactly what you ask for you will still flame and hate. I hope not, but we shall see.... You want to hear "loopholes that don't exist anymore"? Here you go- 1- MWSE. Mid West Stock Exchange had a horrendously antiquated order execution system in the late 90's. They would sometimes "get frozen" while posting an offer. If MWSE was the only MM on the offer, you could keep SOES'ing him and they were obligated to keep filling up to 1000 share orders until they lifted. You could pound them then they would have to buy back all the stock they sold you immediately an 1/8, 1/4, 1/2 point higher. 2- ECN arbitrage. You used to be able to cross the market using the ECN's. Sometimes when a fund had a huge buy or sell order they would cross the market on ISLD or INCA by quarters or halves and you could literally max your buying power buying everything in sight and immediately sell it to them. It was risk free $$$. Happened all the time. 3- "Backing away" prints- You could "Select Net" through the NBBO and hit MM's. They had 10 seconds to fill your order or they had to lift their quote. Very often they would hold your order over the allotted time and lift without filling. You could then call Nasdaq operations (within 5-10 minutes if I remember correctly) and they would rule on your complaint. If they ruled for you, you were given the choice to take the fill or not. Back then guys would get backing away prints and be 5, 10, 20+ Points in the money...and if the stock went the other way you decline the print! It was insane. 4- REDI, STRK, BTRD prints- in fast moving markets the shitty ECN's would "get clogged". They couldn't keep up with the volume and you could get fills at prices where the market was at 20-30 seconds earlier. On the surprise rate cut days REDI prints would come back with fills from 2-3 minutes earlier prices. I got three 1000 share fills in SUNW almost 15 points in the money on that early April 2000 afternoon crash and rebound day. 5- Goose the market- you get long a boatload of stock in a quiet market then throw size bids on Island and Instinet then start SOES'ing the MM's off the ask. You then sell all your stock to the lemmings thinking there was a buyer....then you flip short a truckload, pull your ISLD/INCA bids and post size offers. Everyone would panic out, they would hit all your bids to cover your short. That worked great during slow lunchtime hours and summer days until ECN rebate trading took off. You guys who keep hating just don't understand. I get it, it's hard to imagine how things were during that period unless you were a part of it. Kids right out of college in t-shirts and shorts on single screen monitors with crappy charts and slow cable feeds were printing cash. It really was the Wild West.
Thank you for the explanation. This is the great misconception in the retail daytrading community.... the tales of intraday traders making massive gains from small beginnings are because of market inefficiencies and real tangible edges (that are for the most part gone)...... NOT the standard chart patterns or moving averages taught in the education world. I don't think any retail daytraders today understand this. I never did until recently. It seems it is a lot harder to break into the trading world now. The market is much more efficient. The trading floors, once a great place to learn the game and be mentored are now gone.... You also need a lot more capital to make a go of it.... starting with 10k isn't going to cut it in today's markets.
Dude were you even around in 99-2000? The markets *really were* that ridiculously easy for people to make money trading dot.com stuff. It was absolutely insane - and that's why it crashed so hard.
Forex is risky business and it should be done very carefully i am doing trading for 2 years i have other business also sometime i got many profit from this forex but most of the i was full filled my daily needs and my family needs from my other business income so i think it is not easy to maintain life with only forex income as it is so risky policy to earn.
Am I the only one who sees that as a positive? I'd much rather learn market behavior itself (i.e. Wyckoff, Andrews) which is somewhat timeless albeit less exciting, than spend energy on ECN execution flaws which by their very nature won't last very long. Easy money would be nice, sure, but I'm building a career I want to depend on, not seeking adrenaline. (And long-term, I'd rather tend towards multi-day/week positions for income than stay riveted to my screen minute-by-minute as I do now while learning.) To me, an efficient market means news provide no edge anymore, therefore there's no need to invest time on that, and mechanical "tricks" like the 1999-ish ECN stuff we learned about in this thread are less likely to interfere. (Save for the front-running that HFT systems do, which if you're at least on 1-minute bars shouldn't affect retail trading from what I understand. Right?) If the playing field's more level, then everyone can calm down and go back to seeking trends, reversals and whale tracks. Setting a number is slightly arbitrary I think. The best way to start trading is as a side-project with primary income from elsewhere to alleviate pressure to succeed quickly and to cover educational expenses (in which I include losses). With that mindset, $10K might suffice, and if/when it finally grows, then you know when you can ease off the other income source according to your needs. Of course if someone has to quit his job to have enough time to trade, then I agree with you, something like $50-100K is probably healthier, and still that's with an already proven system...
I don't think it's a good idea to quit your job to have enough time to trade. Don't give up an income if you're not yet ready to go full time. I think if one is going to be totally serious about trading and they want to succeed then they should approach it like any business venture and (1) have sufficient capital (2) be prepared to work long and hard hours as they get going (3) have an appropriate amount of experience with the markets they plan to trade (4) have a business plan (5) have an exit strategy in case they fail.
Just to clarify: me neither. I was just adressing Pigsky's notion of starting capital: if you define "starting" as all-or-nothing (which is naïve to say the least) then you need a lot but if it starts organically as a hobby, I see no real minimum. (Well, except US$25K+cushion if you're in the USA and have an eye on day trading stocks.)
Maybe the best solution is to start trading european trading hours. That way you can work and trade. But you will not have a lot of time to sleep. Start at around 2 o'clock in the morning to trade, then go to job and when you come back home go to bed.
Yikes, I considered getting up for the London open in my Forex days; too early for me. I think I'd rather switch to a longer timeframe than get up any earlier than 5am. :eek: Or, look at Asia after supper maybe.