Hi all, I've been paper trading stocks for a while now with moderate success. After reading the Market Wizard books, I've been keen on becoming a money manager. Some traders make a lot of money through a management fee and performance fee. If I want to become a wealthy money manager, should I focus 50% of my efforts on attracting capital from high net worth individuals? AKA should I know how to sell my services as a trader (namely, building wealth for other people)? I've read books on selling, like Brian Tracy's Sales Success, The Art of Closing, etc. It seems there are certain things that a trader should be able to do in order to get the checks coming in. For instance, a trader should be able to establish himself as an expert on the markets (this is a sales principle that Brian Tracy talks about in his books). I want to be seen as an authority when it comes to trading. A trader should also be able to build rapport with the prospect. People don't write checks to people they don't like. A trader should also be able to ask for the sale (ie, be able to close the sale). It seems trading is only half of being a successful money manager. Some of the market wizards make money management seem easy, when in reality it seems more difficult than just trading alone. For instance, you have to deal with accounting. Marty Schwartz talks about this in his book "Pit Bull." You'll have clients who want to withdraw funds from time to time and you must oblige. What do you guys think?
You should focus on having a consistent track record of trading success first. Even though past performance is not an indication of future successes, a consistent track record of high positive returns will still help in attracting potential clients. Without a consistent track record of high positive returns, nobody will give you anything. Wealth management is a very competitive business.
Start with an IB friends and family account. You can trade 15 accounts without spending $100,000 in legal fees to start a hedge fund. Then sack the lowest account balance when you want to bring in a bigger account.
Another route is to trade for a family office. The barriers to entry for this are lower than starting your own fund but you still of course need a consistent track record trading real money.
The next step is trading stocks with real money and consistently showing profits. Most people never achieve that.
First thing you need to do is to start trading with real money. If you can do that and make a reasonable profit, then you can start thinking about managing other people's money. Paper trading success means very little.
I thought the OP is paper-trading options. https://www.elitetrader.com/et/threads/beginner-options-journal.361047/#post-5442930 He is paper-trading stocks now?
Have you ever considered getting registered Series 7 and see if anybody will buy anything from you? You know, it's not like securities is a brand new industry.
Almost every new trader I came across online or in person thought trading was easy. (I frequent social trade channels a lot.) Well, I haven't heard from either of them anymore. They seem to disappear faster than your friends in mmorpg's.