Debating on going from part time to full time

Discussion in 'Professional Trading' started by cunparis, Oct 28, 2007.

  1. I'm hoping to get a bit of advice from others here who are more experienced than I am. I have been doing stocks based on the IBD method but I found that my mutual funds were doing better than I am. I have Matthews China which is doing great, 120% 1 year average. I've been in and out of mutual funds and it seems like I make money in stocks but then I have one big loser that wipes out a lot of my earnings. I think now I realize that I can't really do stocks part time, it's quite risky. There have been days I've lost a lot of money, whereas if I had been trading full time that day I could have better managed my losses.

    I work as a consultant and can make about $500/day net after taxes. So now I'm debating whether I can make that or more in trading. Actually I'd have to make more because if not the best approach would be mutual fund + work.

    So I'm thinking I can keep the majority of my money in mutual fund investments and dedicate a certain amount to trading stocks. That would give me about $50k to invest. If I do better than the mutual funds then I can adjust the ratios.

    I think in a bull market it's definitely doable. But if there is a bear market, I could pick up some consulting work.

    I have some questions to get me going if someone can be so kind as to get me on the right track I'd greatly appreciate. I've identified the following areas that I'd like some guidance:

    - learning (via books)
    - choosing a broker
    - how to set up screens & alerts
    - which software


    I've read a few books on trading (William O'Neil's book, currently reading Oz's The Stock Trader). Any other books that should be on my must read list?

    Choosing a broker:

    I'm currently using Fidelity. I now realize that I could be paying $1 commission for those 200 share orders instead of $8. I think I will open an account at Interactive Brokers or MB Trading. Is this a good idea? I like having my money all in one place (IRA, stocks, mutual funds, etc.) but if I want to dedicate $50k to trading I could easily have two accounts.

    How to set up screens & alerts:

    My biggest weakness is that I don't have a system for getting automated alerts. Actually even to do that I need a screener to pick potential stocks. Can someone make a recommendation here? So far I picked up on Trade Ideas. I need something like that, would TI be enough? (I've read the reviews here which are very useful but there are so many choices and opinions I don't know what is best for my personal situation).

    Also I have a basic subscription to IBD, they have extra offers for alerts and screens but I don't know if they're good or not.


    With Fidelity I have access to Wealthbuilder. If I use another broker, I'll need something else. I'm an IT consultant so programming my own algorithms isn't a problem, but if I can implement the basic screens without programming that would be even better. Tradestation, esignal, metastock, etc. it's all confusing to me. And if I have to pay for the data then maybe Fidelity wouldn't be so bad after all (Wealth builder is free).

    I realize this is quite a bit, and please believe me when I say I spend all my free time reading posts here, the reviews, searching the net, and reading books. I always try to get advice from people where I want to be (pro trader in this case) and that's why I'm asking for your input.

    Thank you very much for any advice you can give.