Lost

Jennette,

If you are a real person, and a new trader, a daytrader, (vs swingtrader), and really want some guidance, here is what I can offer.

First off, I am a real person, and a daytrader in training. I have been kicking at this for almost 2 years, and have learned some things, mostly at considerable cost of time, money, and mental pain.

If you were my daughter, and starting to trade today, I would tell you to do the following. This is what I wish I had known the day I walked into the bank to fund my first trading account.

I suggest the following:

Read this forum often. Become familiar with www.siliconinvestor.com. Especially the “daytrading fundamentals” thread in the “short term trading” group. They have a grouping of daytrading topics. (link anyone ? )

Read all 3 of Tony Oz’s books. Read Mark Douglas’ “Trading in the Zone”. Read John Murphy’s “technical Analysis of Charts” and either Nisson’s or Morris’ books on candlesticks. These books give a good enough picture of the technicals of trading so that you know what everybody is talking about. By the way, I must have 50 books on trading, and I have gotten something from them all. BUT… don’t try to become a technician of the market. Most indicators are utterly useless to a beginner. (My opinion is that most are rubbish to anyone, but some folks love them)

Trade only 100 shares, and one trade at a time. The only broker available that will enable you to do this cheaply (that I am familiar with) is Interactive Brokers. A penny a share for 100 shares = $1.00 trade cost per side. ($2.00 total for both in and out.). This will keep you from being eaten up by commissions. It will also keep commission costs from being an undue influence on your trade. There are hundreds, if not thousands of postings about IB here. Visit their website www.interactivebrokers.com. You will have to take a simple test and claim some trading experience to open an account. There is also a thread on siliconinvestor called “interactive brokers/timberhill”. One thing.. you MUST trade to learn trading.

There are a number of chatroom and stock picking sites. I have sampled several and joined a couple. Reality Traders is as good as any, and much better than most.

Check out, then join, Reality Trader chat room. Vigorously apply yourself to studying ALL of their training materials. Observe what they do, listen to why. Trade some, remember 100 share lots only, and watch a lot.

Trade the QQQ’s, for all the reasons listed on Reality Traders’ index trading room information page. I traded the QQQ’s without plan or much knowledge for a year through IB, and it only cost me a few hundred bucks including commissions. The Q’s are very forgiving for beginner traders.

Prepare to spend a lot of time, energy, and frustration learning to be a trader. There is nothing magical about trading. It is, however, different than spending the effort in becoming an engineer or doctor in that, these endeavors are almost certain to have a payoff at the end of your preparation. There is no guarantee that the effort to become a trader will result in a successful trader. Perhaps it is more akin to a desire to be an entertainer or professional athlete. The effort to learn must be accompanied by some native abilities, in the case of trading, to master the psychological and discipline aspects of trading.

There you are Jennette, the holy grail all laid out for you.

Beat of luck. If you are a novice, then you have stumbled onto a fine site.

 

Hey Fellas,

Whether "Jeannette" is for real or not ("Katrina" episode has got everyone punchy/cautious),
your advice is very sound & well laid out - valuable to EVERY newbie looking in on this thread.

Although I've decided to go the proprietary route, the goodies herein offer something to most everyone.

Another example why this website is better than a book on the bedstand.

(Easy now - let's maintain the continuity of the thread)....

 

You guys have been posting some really useful information. You can't imagine how much I really appreciate this. I hope I can put your help to the best use possible in trying to start my new career. I'll let you know how well I do.

 

Anyway, the best way to learn is with the futures. No execution issues, just pick entry and exits.

I started with stocks back in 1997(pre-bubble mania) and then went to futures...Stocks were far easier in my opinion than trading something as volatile and unforgiving as SP 500 futures, Nasdaq futures or e-minis for that matter...

Someone new would have a much better learning experience with the listed stocks, which is something I definitely agree with...Once someone starts going the futures way, one single mistake on a smaller account means the game is over, no mulligans...

But, after saying this...I feel that anyone who started with futures and survived would have a much easier time moving to listed stocks...Kinda like trading the market at 1/2 speed with more room for "slight" errors...

two cents worth...

 

There is no "best" market to learn in as long as either:

1) You have an insight into that market (highly unlikely at first) or
2) You have friends that trade that market or have gotten training

I have friends that went straight to the Merc - some were successful, others weren't. I have friends that went straight to the CBOE, or the PSE, or are options traders in NY. _MOST_ of those are successful.

1) precedes 2) (in order of importance) once you know what you are doing, but 2) is the way many of us get into the markets.

Well, listed is easier than SP futures if only for one very important reason - the way the markets are structured fundamentally make the futures a leading indicator. IMHO, Futures are traded either by:

1) Chasing paper (if you are on the floor)
2) Strictly technically (volatility breakouts, spreads, etc.)

I say this with limited experience, as I have never _traded_ futures.

nitro

 

I just don't see how you think you have an "edge" trading futures off floor against locals in the pit. Those are the guys that eventually manually fill your order, and decide whether or not to front-run or take the other side of your order.
I just think the odds are stacked against you and telling a newbie to begin in futures trading would be dangerous advice.

 

True locals in the pit are only trading their own accounts, like us.

Also, most newbies would want to start trading E-minis, which are traded electronically. It also helps to have a live squawk box to the pit to hear who's playing.

 

Magna,

Thanks for the kind comments.

Jeannette,

By all means keep us posted on your progress. There are some jerks here who will bang on you. Simply ignore them. Most folks here are willing to help you along.

Don't hesitate to ask if you have a specific question. Somebody has probably been through it.

 

I did not say "I would advise telling newbies to learn trading futures"...I was attempting to copy and paste someone else's quote and try to argue against it...Instead, this thing made it look like I was the one advising this...

Could not be further from the truth...