Should I make the switch?

Discussion in 'Professional Trading' started by tradervic, Oct 24, 2001.

  1. tradervic


    I am currently an IT consultant making six figures a year that is looking at starting a new business in trading. This is a tough economic environment to be making career decisions, and I would like to hear some comments from the pro and non-pro traders on this board whether or not now is a good time to get in.

    1) Has the downturn in the market, decreased volatility and volume made it extremely hard to make money on a daily basis?

    2) Are there less opportunities to capitalize on?

    3) I would like to start part-time if possible, should I go with a prop firm like Echo, or start out small with a firm like IB?

    4) I am little concerned about the regulations at some prop firms like Echo when it comes to holding initial deposits after one year. What if the firm goes bankrupt? Is the money segregated?

    5) Obviously success in this business is dependent on the individual, but what would the average success rate be given the current market environment?

    6) how many of you are working full time and trading as a side business? I will be starting an LLC to trade part-time, does anyone see any disadvantages in doing this?

    I have many more questions, but I know you guys are busy making money!!! :D

  2. It all depends on how much ur growth opportunities are and how much you like ur current career........Try swing trading for a while and see how you do.

    Also .. a big question is can you support urself while not making money.........
  3. tradervic


    Given current lifestyle, expenses , etc. I would have to honestly say no. I could not afford to take a steep cut in current compensation. That is why I intended to start part time, unfortunately it would be very hard to daytrade this way. Also I am grappling with what vehicle to trade, I am more familiar with futures trading than i am with equities. I did some futures trading a few years ago which was moderately successful.

    My future growth possibilties in IT look good. But there is something about trading that continues to draw me in. It's not just the money, but also the day to day challenge and independence that goes along with it.

  4. As much as you love trading you've answered your own question.......its psycologically draining to go from a six figure job loosing money day in and day out..till u turn the corner...whatever decisionu make...GOOD LUCK
  5. tradervic..

    you cannot earn 100k+ in IT without a proper amount of education/experience.. trading is exactly the same.. the market is the market.. while we dont have the go go days of the past couple years, there are still plenty of opportunities for profit.. but this business requires a very large time/money/emotion investment and you should make sure that you are prepared in each area before you consider making a major change.. it usually takes a year or so for a new trader to become consistently profitable.. thats what ive read in most books and it is true of me.. most recommend starting with 20-50k, some say 100k.. you should be prepared to lose every dime.. emotionally, this business will take you places that you do not want to go.. i dont care how many books you read and how much you "know" about trading going in.. eventually the market will force you to take a hard look at the worst side of yourself and you will either make the needed changes, or self destruct.. this is a great business for those willing to make it work, but count the cost going in.. otherwise you run the risk of becoming a daytrader statistic.. good luck =)

  6. kensmith



    Doesn’t matter if general market is up or down there is always something to trade. Hard work is finding it.
    Start part time with IB putting the least you can in. That way you will not burn through your money too quickly. Trade small amounts.

    I’ve been trading USA markets for about 1 ¼ years and UK around 20. I reckon it will take me about 5 years to learn how to trade USA markets.
    With that in mind don’t expect to make any money for a while.

    I do this full time for a living. Usually 12hrs a day about ECN hours.
    Trading wise, I will trade anything that moves which I can find an angle on. Could be 11cent NASDAQ stocks (ADSX was their not long ago) to QQQs.

    I use pro.

    Its hard work but I enjoy every minute of it.

  7. Nasdaq daytrading is one of the easiest things ,once understood, to conquer.Remember that it is just a game.Don't try to think too much in this business.If a stock should be going higher and it doesn't, it is most likely to go down.If a stock should be going lower and it doesn't, it is most likely to go higher.Buy strong stocks as soon as the market starts to rally and short weak stocks as the market starts to head south.Always have an exit point.For example, if you are going long on a strong stock,it is best to enter when there is a decent sized bid and if you are going short on a weak stock,it is best to enter when there is a decent sized offer.I also found that most of the time, big sized bids or offers get hit or taken.So in a rallying market, if there is size offered on a strong stock at the figure..i.e. 50...and the stock is trading at let's say 49.75...i will almost always buy the 49.75 offer because i know that the majority of the time the 50 offer will get taken.So a few trades like this every day on say 2000 or 3000 shares, which is the size i trade, will hopefully have me swimming in a pool of money by the time i am 35.These are just some of the simple but effective strategies that i employ everyday in my trading.
  8. tradervic: It is most definitely doable. I suggest that you do the math: if you have a 100k account you will probably have to make 50k to cover living expenses, taxes etc. That's about 4.5% per month not counting compounding. That is certainly doable with a bit of experience.

    If you have a methodology you can "prove" is profitable through simulation and you have the willingness to stick it out for a year, I'd recommend you give it a try. Just remember that the same commitment that brought you into 100k salary range will be needed to achieve the same in trading.

    This message board contains a lot of good info on proprietary vs. retail, so have a look at that before you commit your dollars.
  9. tradervic,

    I would guess 90% of beginning daytraders fail, blow up or go back to the real world. I would hate to start out with the pressure of having to fund a lifestyle from trading profits. Do not think of it as a business. A business can succeed because of the economy or a good product or location, etc. A better analogy is professional sports. Your success as a trader is dependent on your ability to perform. Read Hitman's journal to get a feel for a pro daytrader's life.
  10. I dont know if this advice is applicable to anyone else but I personally became a profitable trader when i focused on trading in a short time (1-5 min chart) I began recognizing repeatable chart patterns by sticking to the identical chart format each day.Give yourself at least 6 months though I bet other people may have done it in 3 months
    #10     Oct 24, 2001