HELP: Beyond Intraday Trading

Discussion in 'Trading' started by Hitman, Sep 2, 2001.

  1. Hitman

    Hitman

    I am going to turn 22 this month, and I have accomplished absolutely nothing yet, I feel old, I feel incompetent . . . My weaknesses are shown before my eyes under a magnifying glass, and one question haunted me during the entire weekend:

    If you are so serious about trading, why stop at intraday trading, which even if mastered, is without any question, the small potato compared to just about every other form of trading in financial market simply because of the limited size you can do?

    There is a difference between learning from experience and learning from education. While learning from experience is the dominant way of learning, it is also the slowest. Are there a lot of things I need to learn about intraday trading? Yes, but it will have to come from time and experience. What am I going to do when the market is closed?

    There are many brilliant individuals of my age, working long hours, getting their MBA's, arm themselve to the teeth with knowledge. Knowledge is power, and if I am happy with what I know, I am never going to improve. In my soul, there is a thirst for blood, and there is a thirst for more knowledge.

    I realized how much I don't know for someone who will dedicate his life to the financial market. I realized if I want to make it without a degree, I have to put in more effort than 8 hours a day. I need to spend at least 3-4 more hours a day, reading, attacking, filling the gaps in my knowledge.

    I know for a fact, that one day, I want to become a trader's trader, someone who can trade multiple markets, multiple vehicles, multiple time frames, without having to be a jack of all trades, master of none. I want to make it big time, really big time, my goal is to learn everything I can about the financial market, and eventually, like water, it will all merge together into a single entity, when it will all come together to make me better than ever.

    Think about it, if I know how futures trading works, I will be able to predict futures movement better, and my day trading will improve. If I know how commodities work, I will be able to predict things like oil prices, and it will help me trading energy stocks. If I know how fundamental analysis work, I will be able to trader longer time frames with HIGHER probability than technical analysis alone.

    I AM LOOKING FOR BOOK RECOMMENDATIONS ON FOLLOWING SUBJECTS:. I will start trading another instrument / time frame in addition to day trading, within a year from now, and I may start paper trading way before then.

    1) Fundamental Analysis, no excuses, to be a complete trader, you have to know this. It is not as important as technical analysis, but it helps in so many little ways, like intepreting morning news better. If I ever want to go big time into a longer time frame fund business, this is going to be a huge asset over someone who does technicals alone. I want to read balance sheets, I want to learn how a company operate, this is linked to business management as well, it is too large of a hole for me to ignore if I ever want to run my own business.

    2) Futures, how does it work, or even more importantly, how do you trade it. I have to have at least paper knowledge in this subject.

    3) Options, hedging strategies, advanced topics.

    4) Commodities, why stick with just equities if there are easier money made elsewhere? It is almost the same question I asked a year ago, why stick with just technology stocks when there are easier trades in other sectors?

    5) Bonds, that's right, this has a serious relationship with stocks, and I would like to read more about it.

    6) Economy, I feel like an idiot sometimes when it comes to morning economy news, I would like to know the details behind a PPI, a CPI, etc . . .

    7) Currencies, if you love the game, why not playing it 24 hours a day?

    8) Business Management, I may not have a MBA, but I would like to have the knowledge of one.

    I understand this is an ENORMOUS set of topics I am asking for, but the way I see it, if I am dedicated to the financial market, if I carry the pride of being a trader, I have an entire life's worth of time to learn. The day I stop learning, is the day I stop breathing.

    Please, make your recommendations, I am going to spend a year to take my knowledge to another level.

    There is no limit to learning, there is no limit to trading.
     
  2. def

    def Interactive Brokers

    hitman,
    i'd suggest studying for the CFA. 3 exams - each harder than the next. It will take a couple of years but if you can get through them - and actually learn the material - you'd have some solid credentials. At the same time you'd learn about many of the topics in your post.
     
  3. Perhaps you should consider getting a degree in Portfolio Management. Or...take some night classes on specific topics that your interested in.

    You might also read the archives at:

    http://www.Appliederivatives.com

    Endless knowledge on all types of trading there.
     
  4. Hitman,

    I think you should get out and have a few drinks. :) :)

    Trading is not about Phd's in economics and math.
    Majority of the worlds most successful traders are those who at some point in their career took a highly leveraged position and got lucky.
     
  5. edit eom
     
  6. Hitman - you may want to consider getting your degree and trading part time. You'll have more options when you're done. If you're going to spend many hours furthering your knowledge base - you may as well at least earn a degree. A degree in finance seems to be right up your ally. :)
     
  7. Hoyler

    Hoyler

    Hitman,

    Tall order you have placed there, I once had similar ambitions.

    We have talked about QP2 in the past. If you are familiar with them you may also be familiar with Ian Woodward. He has managed to build upon IBD's rating system with his ERG formula, making fundamental analysis an inclusion in his approach. Being that he ended up only with fundamentally strong companies to begin his research with.

    Stocks, Bonds, Currencies -

    John Murphy's "Intermarket Technical Analysis: Trading Strategies for the Global Stock, Bond, Commodity and Currency Markets." How the markets are related and interact.

    Options -

    http://www.elitetrader.com/vb/showthread.php?s=&threadid=1822

    Futures-

    http://www.mrci.com Historical & seasonal approach to the Futures markets. Also has access to LBR's daily charts


    market internals - a down & dirty 1 stop shop with charts for the visually inclined

    207.86.238.227

    I hope this helps you down your path.

    -Hoyler
     
  8. Babak

    Babak

    I can't resist replying re fundamental analysis. I think it has a very dubious role to play in trading.

    There are many instances of stocks that had very lowsy fundamentals and to (almost) everyone's surprise kept going up. The reverse is also true, companies that are profitable (and making more and more money) while their stocks languish.

    Fundamental signals may take a loooong time to manifest themselves, if at all, in a companies stock price. Multiple expansion and contraction are the main determinants not the E (as in E x multiple = P)

    I think its important that we are constantly aware of that.

    --------------------------------------------------------

    I have to agree with Hitman that it is wise to consider different strategies and markets. Sometimes there is a cross over where what you learn from one helps another, and sometimes not. However, it is a good idea to have a variety of game plans. The markets goes through fluxes where one is hopping, and the other is sleeping (Nasdaq recently vs Eurodollar for example)
     
  9. JayS

    JayS

    Hitman,

    I'm also 21 coming up on 22. Started by trading equity options in a custodial acct at 15. Currently getting a degree in Finance, I spend about 4 hours a day at school and 8-10 hours trading and doing research. I trade futures, mostly US & TY, recently started trading FOREX also. The degree (for me) is something to fall back on and hopefully I learn something along the way :).

    Jay

    "I have never let my schooling interfere with my education. "
    - Mark Twain
     
  10. dozu888

    dozu888

    I think in trading, chart is the only thing. Be aware of "analysis paralysis". It appears you might fall into the trap of "need to know more", contradictory to "let the market show your where it wants to go".

    Remember the KISS principle.. Keep It Simple, Stupid !

    It's a widely accepted concept that TA applies to almost all financial instruments and all time frames, that's the beauty of TA. and the rest is to pick the right market and time frame to trade. For example.. One daytrading firm is doing 15% of the daily volume on EBAY and a few other naz hot babies.. you do the math and tell me how much real trading (supply and demand) is going on there... while in the $1.5 trillion/day Forex market, only 7% is done by private investor/traders (not sure about commodities, little experience there).

    TA is based on supply/demand.. therefore it works better when that portion is high in a certain market.

    Hitman, you have IT background, I am wondering why you don't take a systematic approach and let a computer trade for you. A pro firm certainly has all the bells and whisles to make that happen and a machine is hell-a-va-lot better than you in monitoring multiple markets and send orders in with iron-clad discipline. It sounds to me that your tape reading stuff is very codable (step in front of big bid/ask, top down analysis with futures, close out position on print weakness etc). This way trading becomes a pure form of research. You want to trade multiple markets across multiple time frames? then it's only possible with robots, unless you can maintain 100% focus 24 hours/day.

    And meanwhile you can persue academic stuff for something to fall back on. 6-digit salary is not a bad thing and it's a lock on Wall Street. and you can leave the daily battle with specialists to your loyal trading robots. (on 2nd thought, maybe the specialists have been using robots to do the shake-n-bake, wiggle-n-jiggle and drive daytraders nuts).

    It's the way of the future, my man ! :cool:
     
    #10     Sep 3, 2001