"This is another key point. Being able to do this consistently for 10 or 20 years. I know a lot of guys that can do anything well for 2 to 5 years, its longevity that matters in this business. Where do you think GOOG's stock price would be if they said tomorrow they only seem themselves making money for another 3 to 5 years then thats it. I think it would be a $5 stock. Any guy can jump into a trend or a hot market and milk it for a year or two, I'm talking about traders that can trade for 10 to 40 years. Yes, they are out there." If you are truly good at trading futures, there is no need to trade them for longer than 3-5 years. Hit your licks and put the money in other investments and once the pressure is off to make big money, live life.
I have amended this statement somewhat in previous threads. Although I stand by most of it. Most futures traders I have met are unprofitable. But I have put together a decent training program here based loosely off my days trading stocks in NY and the work of trading legend Mark Fisher. And the guys in my office, including myself are doing well with it. That is why I'm teaching them to trade index futures. But this doesn't change the fact that where ever I go, most guys I meet that say they trade futures, are not ultimately not profitable. I think one of the reasons behind this that a lot of futures traders are guys that fell under the PDT rule for stock trading and migrated over to futures. I don't think one should be trading futures if they are undercapitalized and most of them seem to be.
Hydro, everyone in our office trades futures. I don't recall ragging on futures firms. Just on the fact that the success rate for futures traders in general seems to be smaller then stock or option traders.
Ok, I just remember you talking with Don about index futues and was confused. I agree the game is hard and takes time to learn. Most never make it though the losing curve. That is the beauty of futures that lures in the money to be taken. The simple fact that you can trade a 70k instrument with only $500 margin is what keeps the game alive.
I don't remember being confused. I think that was Don. I spent a good 30 minutes talking about nothing but futures at the end of the chat.
What? I've never been confused about anything - maybe delusional, but never confused. Don (Besides, we being the same person is confusing enough).
There is a very good reason for this. Its MUCH easier to enter the futures trading world with very little capital and no training. Many have no clue what they are doing as it does take a long time to get proficient. Add the leverage they play with, and its no wonder that most don't last. Its a wonder that any do.They get blown out before they learn the game. I also have done both, and I find index futures much easier (execution and volatility being most important to me) As for the "direction fantasy" mentioned by Don, this may be true with equities in the current environment, but not with many futures markets. They have large ranges and trend very nicely most days. There are many futures day traders that trade direction only (I am one, although I aim for very small pieces of a trend). When I worked in one of Don's offices in the late 90's, many of the guys there were making cash taking direction as well. This was due to the volatility, not just the prevailing up direction. Big money was made on the down days as well, although we spent a fortune on bullets. Jay