Folks, I'm starting this thread for two reasons. One is I'm tired of hearing that 99% of traders don't make it(which is probably true) and I want to do a career change to full-time trading. I'm going to give you guys/gals a chance to beat your chest. I would like to know, if this is not too bold, what type of money people are making. Possibly you could give ranges if you want to not let too much out of the bag. What I'm trying to get a handle on is what type of money people made say their first 1-3 years, 4-6 years etc., and what finally helped them turn the tide to higher profits. I know there are some successful people out there. I feel I could become as good and would just like some feedback to set some reasonable expectations if I get to where you folks are. Cheers
Welcome to the trading community, I started in 1997 at the age of 18 with $10k in my Datek account. I traded from home P/T while I went to university. During the .com mania, I grew it to $80k then blew out my account by 2001. Luckily, I spent quite a bit during those 2 years so it wasn't a total loss. = ) I restarted with another $6k after about 6mos away from the market. I blew that up within the year because I was undercapitalized and didn't obey my stop losses. After graduating from univ with a BA, I went to a prop trading firm. I'm still at one now. Although I am gross positive, I am net negative (due to commiss). I have yet to be consistently profitable. I've been at it for 6 years. Trial and Error for 5 of those years and Professional for 1 year. I've read quite a few day trading books and have my Canadian Securities Course (that doesn't really teach you about trading) and I'm currently studying my Series 7 (that doesn't really teach you about trading either!) = ) I heard it takes about 6 years for a trader to develop so I'm right at that line. If I make it, that would be great, but if not, then I'll look for another career and be part of that 90% of failed traders. What career are you currently switching from and how long have you been at that career if you don't mind me asking? DNAJ65000
A reasonable expectation is to still be trading after 3 or 4 years, not having lost all your money. If you can do that, you will probably make it, and start making money. Yes, I'm sure you will hear from people who made lots of money their first year or two and never looked back, but in the real world, they honestly are the (VERY) rare exception. Concentrate on money/risk management, and learning all you can, rather than trying to take money out of the market at first. If you can do that, the profits have a way of taking care of themselves after a while. Most of the sucessful traders I know that have been consistently making money for at least 20 years had a learning curve of several years (at least) before they were consistently profitable, let alone making a living trading. Once you start to get it figured out, it's a great way to make a living, though. Good Luck! Jessie P.S. As for your initial question, I blew out 3 or 4 accounts over a 15 year period before I finally developed the discipline (and that was the key, not any sort of special market or trading knowledge) I needed to be sucessful.
Good luck in your endeavor! Just one peice of advice = focusing on the potential $$$ to be made is the worst thing a new trader can do. Risk management and finding an "edge" no matter how small it may be should be your number one focus. I think the quote goes like this = "now this is ugly, your are part of the market and can never leave" Slezak
ask yourself this question: what is the career path of a trader ? Most traders end up ultimately in sales: that is they either run an entity that compensates them in commissions which depend upon transaction volume, or they end up hawking some type of system. There are some traders however that stay in trading for a long time and are consistently profitable - in a meaningful way that affords a very good living making much more than 100K in take home compensation per year. These people are very rare however and typically have achieved this after several years in the financial markets making more typical employee wage amounts.
more to the point: they're highly unlikely to show up here pounding their chests like a young johnnie weismuller.
Its probably closer to 90%, which is a good thing if you're in the minority...you get everyone else's money. Hold on dude...don't even think about trading short-term trends if you can't sucessfully trade longer trends. Take it easy, slow and steady wins. There are old traders and bold traders, there are no old bold traders.