Becoming the Top Trader

Discussion in 'Professional Trading' started by OnGoing, Apr 26, 2004.

  1. OnGoing


    Becoming the Top Trader

    I quit my job 3 years ago, as I was tired of the bullshit at work and needed to give myself a real break. I had lots of success in my career and being 35+ I needed to find myself again, getting away from the negative stress not following your own true bliss. I did nothing for like 8 months, spent time with my family and friends, at the beach and didn’t even think about work. Then, I slowly started to work on some projects to start up some new businesses, while starting to spend a little bit more time trading (mainly position trading). I had more than U$ 1.000.000 dollars saved being 35+ so I felt really safe quitting my job. Now, after owning my own house etc I have like U$ 800.000 for investments and trading.

    Anyhow, during the last years at my work I kept trading every week or so, sometimes winning and sometimes losing but I was probably down U$ 100.000 or so after following a lot of lousy broker advices and not understanding trading at all. To make a story shorter, I ended up determined understanding why I couldn’t consistently win on trading being intelligent and well-educated. I started to read some books and bought more until I ended up reading almost everything there is while buying Wealth-lab and digging deep into the systems design. Having a finance MBA as well as a master’s degree in engineering, I also digged deep into heavy trading and finance stuff as well as getting into the study of psychology. I have read almost everything there is which seems to be good, like Van Tharp, Elder, Kaufman, Chande, Conway, Schwartz, Schwager, Katz, Jorion, Hull, Malkiel, Alexander, Shiller, Lefevre, O´Neil, Fosback etc etc and I am not going to mention the titles…:)... Also, I have really gone through Van Tharp´s Peak Performance Home Study course (knowing my weaknesses and strengths much better and also what I need to get better at in terms of trading) and am developing my own Trading Plan which is going to be completed in a few couple of weeks, as well as taking a Series 7 license.

    This I started like 2 years ago. I thought I had come far after 1 year when I started to test trade some of my systems. Then I understood I had lots more to learn and stopped trading, to really try to learn everything about trading and what mistakes others have done before taking up the trading again. Since then I have traded very few, except for live trading some of my own systems and I really know now how slippage, commission, limit orders etc work and the difference between back testing and actually trading live.

    A major part of my capital I have put in a portfolio of hedge funds using portfolio modeling expecting to have around 15% long term which will keep paying my living. I know some trading strategies that some friends are doing fine with in day trading, but I want to wait a little bit more to trade them, maybe just test trade them. I also am working on some position and swing trading systems to add up to my “portfolio”.

    As it seems there are some really good traders in this forum, it would be interesting to get your thoughts on my next steps. After a long time, I have learnt all of the basic stuff like cut your losses short, let your wins run, position sizing, stop-losses as well as more complicated trading stuff for stocks, options, futures and commodities.

    I really want to become very good at this!

    What would you do next? Looking forward to hear from you.
  2. Mecro


    What are you trading? NYSE, Naz, ETF, futures?
  3. OnGoing


    I have focused on stocks on NYSE and NASDAQ.
  4. While I have a moment, I want to express an opinion. There are over 20,000 members here, but I doubt that there are 1000 who are profitable. Also I notice that many of the best traders post very infrequently. Some who I know to be profitable, or to have a history of being solid professionals have stopped posting because they became discouraged (keep reading the posts, you will get the idea) having to weed through the flakes, wannabes, and eccentrics that lurk on the site, waiting to get into the action. My advice would be to maintain a healthy skepticism and to research all claims carefully. It will help to have a lot of patience and a slow fuse. On the positive side, there a people who know plenty about the business of trading, about options trading, testing and systems trading. It will take a while to figure out who they are. I hope you have a good sense of humor. Best Regards, Steve46
  5. UMU


    Trade small, trade often, trade automatic --> daytrade using automatic program trading. Of course everything must be very well tested before. The development of such an automatic method can take about 6 mo or even more.
  6. what type of gig left you a millionaire at 35 + ?

    you might want to go to the next mbfcc seminar
    if they have one or at least read their book

    good luck


  7. Two lessons in one. The first, and most important is personal responsibility. No matter whos advice, good or bad, you had the final descion over your money. Secondly, whilst I know some good brokers, they have good and bads days, and ultimately they are brokers and not traders - they hold hands, they don't drive - if they did they would be traders.

    Your next move is to find some really sucessful traders and go sit with them. Offer to make the coffee, do the typing, whatever, just get into thier frame, because that is how you will learn most effeciently. I have already advised the 17 year old to get down to the floor of the board or the merc ( no less nymex or the nyse) - whatever, just get in amongst traders and trading. You have to immerse yourself in it. Why not try that. Just because you are twice his age makes no difference, to you or to them.

    I would also advise that you take the time to just sit and watch a single market all day long for a week. No trading, no opinions, just watch the price action. Then do the same for another market, then another. Then go back, after three weeks of what seems mind numbingly boring (if you are going to love trading, you'll find it's not boring at all) and look at the price action of the first market you saw. You should notice major changes n the way you look at the market. Pay particular attention to howe the markets behave with the release of economic data - one of the strongest signals around is when the market goes down after good news - things like this tell what is already priced intothe market and how the market is positioned.

    Play with a data source - cqg is the by far the best in my book, and learn to program things that relate to your view of the market. Then when you have a view on the market, wait till you system agrees, and then enter the market. Hate to take a profit, love to take a loss and you'll should find some improvement.

    Don't buy into anyone elses system - the classic is if it works, why sell it. As for what you can learn on a course - you'll learn infinitly more by watching real traders. And real traders love doing nothing more than talking about the markets.

    Make sure to keep physically fit and healthy. If you have the time, study a martial art. Learn how to breath properyly. Be generous to those less fortunate. Buy a dog. And good luck to you.
  8. sounds like you are on the right track.. i have to agree with Steve though, be wise about what you hear on ET..

  9. who ?
  10. Down 100K? Boy what can I say? In some ways I am just glad I started with less than 5K , this could never happen to me :)
    You need to trade to learn. Put your stake in some bond fund or safe investment ( I guess bond funds might be going down now) use 10-15K , and test ideas with that, risking $250 max per trade. Then maybe try to formalize ,backtest etc.your ideas Come back in a year or two.

    and forget about being "the top trader" lol what you wanna be Soros ? yeah, try to make a bit of money every month first
    #10     Apr 27, 2004