Some questions about getting started as a career trader

Discussion in 'Professional Trading' started by Longhorn_Trader, Jun 2, 2009.

  1. Hey guys. Hopefully this is in the right forum, sorry if it's not. But I have been a successful, somewhat active trader since I was 16yrs old and am now looking to move into a more active trading role as a career move. I was wondering if there are any books or educational materials that you would recommend to help get me started as well as which online brokers you would recommend that I take a look at. I am looking to start my account with around $25k and am still deciding on what my exact trading strategies will be. I will probably be looking to put stop loss limits on each trade for around 1%-2% of a loss. Thanks for any advice.
  2. Could not edit my post at this time, so I'm posting a reply.

    I forgot to mention that I plan to focus solely on trading equities. Also that I am 23 and am looking to do my mba sometime in the next couple of years. If I follow through with this, would it be possible or make sense for me to incorporate as some sort of investment LLC so that I will have something to list on my resume, as well as have an easier route when it comes time to do taxes? I have done self employed income before and think it would be easier to just do taxes for a company, I could be wrong though.
  3. sounds like you know what you're doing, which is a good starting point! :)

    1) see my reply in the thread:

    that thread has a 'this can't be done' bias, but there's some useful stuff to look at anyway

    2) incorporation: having this on your resume may or may not be a good enough reason to incorporate

    people, including various financial people, usually incorporate for two reasons: a) limited liability (which means if your company owes something to somebody, it's not you personally, it's the company) and b) pooling of capital.

    you really need limited liability if your business interacts a lost with other people/companies, e.g. provides services, training etc.

    there may be a third reason, like creating a business platform for further things. it may be a valid reason, but running a company usually has additional costs (accounting, legal, formalities), including the time effort. these costs may or may not be significant, probably minimal in the case of a plain vanilla small business company. but you have to check that. it's not hassle-free in any event

    maybe it's worth it, maybe not.

    if it's inidvidual trading only, not providing any services to others etc etc, you may be better off doing it individually.

    tax treatment: i don't know

    3) transaction costs, the cost of your business. interactive brokers has the best deal on commissions. that's key

    4) "if you day trade, you should buy at the bid and sell at the offer" (Linda Raschke). the bid/ask spread may seem like a small thing, but if you day trade you should make sure it doesn't systematically bite into your profits. in the long run, that would add up to significant costs

    good luck!

  4. 1) Focus on the trading strategies to the exclusion of EVERYTHING else.
    2) Don't be distracted by that MBA-crap, i.e. taxes, marketing, legal, P.R, I.T, sales, advertising, accounting, shipping, H.R., office space et al. :cool:
  5. Thanks guys. I realize that the forming an LLC or corp. part is not really necessary for an individual trader, but I think in my case it might make sense. Not just because I plan on getting my MBA in the next few years and it will be key to have that on my resume, but also because I am hoping that over the next year or two I would be a profitable trader and possibly be able to grow the company from just me, to include other traders pooling capital or possibly trading for investors. I realize this is a lofty goal for someone who is just thinking of starting out as a day trader, but hey you gotta have something to work for right?
  6. you may want to look at it in more detail, before incorporating anything . . . this professional securities stuff is licensed and regulated . . . so it would be a company subject to a special regime, probably, depending on what exactly you want . . .

    do your due diligence in advnace :D

    good luck!