Best route for a newbie with limited capital?

Discussion in 'Prop Firms' started by Persepolis, Jan 30, 2013.

  1. Get a job. We all did.
     
    #11     Jan 31, 2013
  2. I don't think that capital or working in the financial industry has much of anything to do with being a successful trader.

    First off, if you want to be a trader, Futures not stocks or options, make the most sense. Why? 1. Much better tax treatment. 2. No pattern day trading rules.

    Second, to be successful, you only need three things : a trading strategy which over the long run is profitable, the discipline to actually implement that strategy, and last, just enough capital to survive a drawdown.

    Do you have a strategy? Get to work. Pick a futures contract (TF is my suggestion). Then consider what trading strategy would like should be profitable. For example, research for example the 5/20 moving crossover system. In other words, when the 5 bar average crosses over the 20 bar average you buy, and vice versa. Take a look at how this would have performed, and what parameters you would use to trade it.

    Got a fully developed system? Great, live sim test it to see if 1. it works, and more importantly, if 2. you can follow it.

    Then figure out what you think your maximum drawdown would be, multiply that times 3, and begin live trading with just one contract.

    None of this is capital intensive, and none of this has anything to do with a job in finance. Good luck!
     
    #12     Jan 31, 2013
  3. Eyez

    Eyez

    Go trade SIM until your profitable. Don't get out of SIM until you can consistently produce consistent returns within the framework of the entry and risk management rules as described by your system. Treat it like real money.


    Then, when you step into the live environment, don't change your rules. The common mistake with being profitable on sim and sucking trading live is that you will 95% guaranteed that you will change your style in the live enviroment, ie. going against your rules, ie. thinking the market cant keep you at a loss forever, ie. being a dumbass

    The only experience your going to gain as a trading assistant is how to manage multiple orders of dunkin donuts for the various traders in the office and then distributing their coffee correctly.



     
    #13     Jan 31, 2013