I've been daytrading for almost 2 years now stocks only. I know there are still many people out there still making a great living daytrading stocks and futures but I know of many who have left stock daytrading in 2003. When I started in 2002 with very little experience I did very well and thought how great this all was and how much I love this job. As 2003 dragged on I realized I may not have another year like 2002 for some time and that was my first year. My advice is threefold. First, if you plan on daytrading stocks you may want to wait for a better time to jump into daytrading. The Vix is around 16 now and the lowest volatility since 1996. Maybe this volatility is more normal than the volatility we had from the late 90's thru 2002. All I can tell you is I know there are lots of traders struggling now compared to a 2002. Second, I would advise to stick it out with your job you don't like as long as possible and have much more $ than you think you will need for trading. Having lots of $ will allow you to swing trade as well as daytrade so if one part isn't working too well the other part will help compensate. The other good thing about being well capitalized is you won't have as much pressure on your trading. Thirdly, swing trade the markets and learn as much as you can about trading before you make the big leap. If you aren't doing really well swing trading don't expect to be killing it daytrading. Learn to cut your losers, hold your winners, find good entrys & exits. Recognize the possible big trades where you take a bigger position. You really better be doing very well with swing trading before considering daytrading. Okay one more for a bonus. Find a good trading office if you are just starting out. Very important! Best to be around other traders anyway but especially starting out. Trading for a living can be heaven and hell at times. I enjoy it very much most of the time but can be very stressful during tough times. So if you were my brother I would tell you now is not the time. Be patient and wait. Many traders with experience myself included are just scraping by. Best of luck when you do make the plunge!
Yes... but... Complete Freedom and independence comes with a cost or shall I say sacrifice... You can't expect a newbie to go on his own without any prior skill invested in his/herself as a trader. If the original poster is willing to sacrifice enough time and energy, I think it's fine... But no matter what it's hard work... Though, it is extremely rewarding....
To all: Thanks for the great feedback. I look forward to more. I do understand that trading for a living is not easy work. There is alot of research, risk and hard work that makes one successful. I do not plan to jump in anytime soon. I plan to read, read and then read some more (all the while collecting and saving my paychecks). My plan is to continually progress over the next year trading longer term stocks eventually shortening the time periods until I get a feel for the trends. I don't want to make a fortune (I'll keep buying a lottery ticket for that). I just want to know that I can make a living doing what I want to do instead of what someone else pays me to do. Thanks again for everyones comments. At least I know a few people enjoy it. Now get back to work!
Your post sounds somewhat similar to what I went through over 8 years ago. I had spent 17 years in the corporate world .. decent compensation, benefits, etc. but was tired of politics, idiot bosses, etc. I don't know your background relative to investing and trading .. it had been an interest of mine for quite a while and was one of many endeavors I contemplated when I made the decision to leave my corporate job. And trading is what I chose. It's been a good 8 years, even with the bear market we experienced. One has to be willing to trade both long and short to survive IMO. The freedom one has is not quantifiable and you can't put a price tag on it. I have a hybrid trading approach where I allocate a portion of my trading account to day trading and the remainder to short term swing trading. Also, you'd need to decide how important the social aspect of work is .. would you be comfortable trading from your home or do you "need" to be around people (and thus might trade from an office). I've done both but enjoy trading from home more ... no commute, no outside influences (hearing another trader saying "XYZ is ripping up" and emotionally chasing such a trade at times). Trading isn't easy ... make no mistake about it. But, if one is disciplined they can make it. Last, you need to assess your financial requirements .. do you have a mortgage, car payments, credit card debt, wife and/or kids to support? I strongly recommend that you minimize or eliminate any debt before venturing into trading. With your current paycheck you know you have $$$ coming in for such recurring bills ... with trading there is no guarantee. Best of luck in whatever you choose.
Hey Dude, Reading Trading in the Zone, by Mark Douglas will not help people "trade their way out of a ripped paper bag". You sound like you're still sitting in it! nononsense
If you really asked traders on this board assuming they are over the age of 16, if they could have a salary of 100-150 plus or continue to grind it out, i d be hard pressed to find anyone in this day to turn it down. I suggest you keep your job, this job is tough...it is not as free as it seems, the grass is always greener.. do you want to have permanent stress in your body, stress while sleeping and cant wait to read barrons to find out what the hell is going on, then go for it. not to say you cant make money, it is just you become a "trader" and see the world in only one way, it consumes you, dont for a minute think it wont, actually you may have been already taken in by its siren call. Try to imagine this..instead of x per month coming in imagine losing money for the week or the month, if this would nt bother you at all, maybe this is in fact the right job for you. good luck in whatever you do and dont listen to this board too much, unless you want to make $50/day.
Be very careful about what you hear from folks on this board. There is so much bullshit in this kind of forum. The fact is, trading is much, much harder than is generally acknowledged. Some things I've seen: The ego poster: doesn't trade at all or is a complete loser, but he'll post on ET like he is a master of the universe. Short term winner: This person has a winning streak and is feeling happy, so they post on here about how much they've made over the last 'x' months/weeks/whatever. What they never reveal is that, while they may have made 20k recently, over their trading career they've pissed away 200k. But, hey, it's fun to feel like a winner. The backtester: They've got a great curve-fit, over-optimized, mechanical system and they post as if they have made a ton of money trading it. It will blow up in real time. More likely, they'll never really trade it, because they only have a 1k account. The gambler: This person LOVES trading, and he'll post about making money, but he usually doesn't really. He's just the addictive personality who loves the thrill. These folks are almost always losers in the long run, but they will post about the joys of trading, but they are just loser gamblers for the most part. etc etc Have fun and report back in a few years. I'm committed now and have no intention of quitting any time soon, but if I had the decision to make all over again? I would have put all this energy to use in some other way. m
kcmike, In any difficult and potentially very rewarding activity most of the entrants are culled. Trading is no different, although the market does seem to be rather efficient in sorting out its participants. There are naysayers in every field. So what? Ignore them and figure things out for yourself. Besides, you never really know who you're talking to, or taking advice from, on the internet. Before turning to trading, I was in corporate banking (lending and account management). When I was a trainee in the late 1980s, I worked with 2 self-important account managers who were repeatedly trying to discourage me by claiming that account management required a "special" type of person. They were morons. Within 2 years, one was fired and the other was demoted. Special indeed. So you would be wise to cast aside the "Discouragement Fraternity" (to borrow a term used by Robert J. Ringer in a book he wrote in the 1970s). Their job is to keep you down where they are. On the other hand, I would be equally skeptical of those who claim that they became consistently profitable after only a few months or a year. Don't let such claims either encourage you or discourage you. No doubt, you are familiar with Jack Schwager's Market Wizard books, notably the first one which was written in the late 1980s. You will recall that, with little or no exception, these remarkably successful traders took years to become profitable, and this was at a time when markets were deemed to be less difficult to trade than they are now. Indeed, if you were to accept at face what many members here claim, then Mr. Schwager would need to look no further for material for his Market Wizards volumes 4 through 44. Therefore, you are essentially on your own, which is what trading is all about in the first place. (The people who want to "help" you usually want to sell you something. Not always, just usually, so it is a good working assumption.) You said you will do a lot of reading. That's good. You will get a few different perspectives and then go on to develop your own. But bear in mind that reading is to trading as reading is to swimming. And while you should test your intended trading method before committing money to it (back testing, forward testing or whatever), do not overestimate the value of paper trading. Absolutely nothing replaces real trading. That's when your mistakes will hurt and you will take them more seriously and adjust for them where necessary. You will not be nearly as sensitized or focused while paper trading. So do yourself a big favor by trading very, very small at the outset. If you start trading to make money immediately and commensurate with your former salary, you will likely hurt yourself. I did, anyway. Ensure that you have sufficient capital for trading and, separately, for living expenses. If you do not, it will affect your trading negatively at a time when you need all the positives you can get. As an aside, I have been trading for a few years now and have yet to come close to the salary I left behind. But then, I'm a slow learner. In any event, I do it for the same reason you noted in your signature. Perhaps the "real money" will come soon. Maybe tomorrow... Good luck. Regards, Thunderdog
How true.. Don't forget the advisor or the mentor.. this is the guy who monitors every single thread on ET on average 12 hours per day and has an opinion or answer to just about everything. Leaving the rest of us to wonder.. why doesn't this guy get a life?