I have dabbled in virtual paper trading for years, but only recently got serious and learned how to read charts. Before was just playtime, lately I have gotten very serious about trading on Marketwatch.com's Virtual Stock Exchange (VSE). My goal is to one day day trade for real. I've been generating what I believe to be good profits, but want to run this by the elite traders of this forum and see what you think. Here are three recent successes: (1) Between May 21 and last Friday (9 trading sessions) I turned a $50,000 VSE account into <b>$127,000</b> - a <b>154%</b> increase. This included 26 consecutive profitable trades on SIRI last Friday (Dow's worst day of 2012) when I scalped it up and down for profit both ways. That day alone was a <b>$43,000</b> profit. (2) This past Monday, I traded a $1 million VSE account ($2 mil buying power) and profited <b>$102,340</b>...in one session. (3) Yesterday I traded a$25,000 VSE account ($50K buying power) and made <b>$890</b> in profits on 6 profitable trades against 0 losers. I have no idea if these successes are great, good, average, or not much at all. Please add you comments on these three successes to help me understand if I am on the right track as a trader. FWIW, I use RSI as my main technical, with stop loss orders used religiously to avoid massive losses...and nothing is held overnight, all positions closed out by end of session. My longer term goal is to hook up with a real prop trading firm based in the U.S. that I can trade on their system with no capital investment and no Series 7. I also do not need a cut of the profits, I just want to get my hands on a real system and see if the strategies I am using on the VSE will work in real world trading. I just want to demonstrate to a real prop firm that I think I have a pretty decent handle on how to generate intraday profits, and prove to them they can let me use their capital. After I wow them, THEN I'd love to get a cut. Your turn....
Scalping SIRI??? Your VSE is extremely flawed and giving you unrealistic fills. You would never be able to replicate those trades in real life. Add a penny to your cost basis and subtract a penny from your sold basis. Still profitable? Think not.
Congrats on your results and your excitement about trading. I have zero experience with the sim you are using but ... Paper trading does not simulate the most important element...your emotions once you are in real trades. Luckily most people don't emotionally discern between small and bigger losses so you can get around this by just starting small. The important thing is to immediately start trading real money, even if it is small amounts. Start getting the experience. You'll experience poor fills. You'll have days where you do everything perfectly in your head and then screw it up in the execution. You'll have great days where you beat yourself up because you didn't make more. Usually the bad days will hurt 5X worse than the good. BTW, you seem to be shooting for high accuracy and low risk:reward. Just make sure that approach fits your personality (rather than your financial desire eg. making money day in day out). Personally I prefer an approach where I can be wrong 50-70% of the time and still be profitable. Good luck!
PKTS, TY for real comments, they are quite helpful. I really want to find a way to get onto a system where I can trade in exactly the same way I would in real world, in terms of speed, executions, fill prices etc. So far, nothing but zeroes. So how does a rookie trader get started...open an eTrade account and make tiny trades with T-3 settlement and Reg T rules? Sounds boring, slow and far more risky. I would hate to hold anything for more than an hour tops...more time held = more exposure for risk.
Sure thing man. Yes, it's problematic if you want to do stocks and account is < 25K. You could trade 1-2 contracts of ES with 10K (or 1 with 6K) but the moves are going to be bigger than with stocks. I had a friend who had a small account ($5K) and he did alright daytrading (actually night-trading) the British Pound futures....not the greatest liquidity though. If you want a more accurate reflection of trading I'd suggest trying sim trading futures. It's been a while since I was a rookie but I used Interactive Brokers real data feed with button trader or bracket trader. You will still have no slippage (the sim will read the last price as both the bid and the ask) but with index futures there is good liquidity so just take off two ticks per completed trade. As a rookie trader you are going to lose some money at first, either through paying for education or through having losses. I'd rather get the experience through the latter. I strongly recommend the Market Wizards books to new traders.
PKTS, thanks for the well-worded reply...very good intel. I am getting hammered as a brainless idiot on another post on ET for asking what I though was a legit question, so consider yourself the classiest commenter I have met on here today.
Great results so far but small sample size. Keep on going for many months so you get exposure to many different kinds of market conditions. It sounds like you've learned how to make a lot of money on your good days so focus on limiting your losses on the losing days you have. Once you've felt like you've had a lot of great losing days, then look to begin with real money.
My turn? Do you want to hear what you want to hear or do you want to hear what you don't want to hear? Dilemma...... What to do... what to do... IBM presents you make the call.....