Discussion in 'Trading' started by SimpleTrades, Feb 19, 2011.

  1. I am a virgin! Well, to be precise, I am a virginal trader. Actually, I guess I just lost my virginity. I have worked exactly half a day as Proprietary Day Trader. Not a bad first day. I didn't lose any money! Profit? $3.50 (after fees) on $10,000 of capital. I am a student trader still. Need to earn $2000 of profit in one month to graduate and receive more capital to trade. I have been given complete freedom to trade any stocks priced under $30 on the Nasdaq, TSX, or NYSE. Minimum 100 share lots. I guess I can chose more expensive stocks, but with minimum 100 share lots this is risky.

    I've been reading a lot about people's experiences on this forum and others. I am curious to know how many of you trade by yourself, and how many of you work for someone else. My suspicion is that those who start by themselves tend to do more poorly at first. Am I right?

    Any further recommendation would be appreciated. Please, help me to succeed as quickly as possible. Thanks.
  2. Wilt


    I trade for myself, started by myself, and I believe that contaminating your talent with the perceived limitations you get from others is counterproductive. I am a very good trader, take my advice or don't. I believe you are setting yourself up for trouble by using limits like stocks under $30 etc. Your goal of 20% in your first month is pretty lofty. I simply recommend that you don't limit yourself to any stocks or trade sizes. Trade where the action is. If that's NFLX, it's NFLX. I would look at your goal as 1% per day. You can make 1% in high dollar stocks as easily, if not more so than in stocks under $30. Trade to achieve your goal, not to transact any certain number of times to please your firm. Good luck and never pass up an opportunity because of share price.

  3. What you'll do if you blowup your capital trading?
    You'll find yourself with no job, no income no savings and no career.

    Use your money wisely invest those $10k in a few semester tuitions and study hard.
    Get a part time job continue studying and as the last resort get a student loan.
  4. I trade by myself using strategies that I mostly learned myself, though collaboration with others was a huge help. To me it is a disadvantage that you have a target goal within a target time frame. I have a goal in mind for my results but the opportunities the market presents vary and so I just take what I can. I suggest you focus on applying what you have learned and try not to thing about the money. If your strategy has an edge and you follow your plan, then the money will come.

  5. .... and be another graduate with a worthless degree.
  6. I'm a prop trader. I learned how to trade by being paired with a trader that was making $400k>/year. As to your suspicion, most everyone that I know that has become profitable (myself included) does poorly at would probably do less poorly for a shorter period of time if you had guidance from someone that knows what they're doing -- of course the assumption is that you actually LISTEN to what your mentor has to say. I've seen many guys totally ignore their mentor's advice and fail miserably.
  7. What are you talking about? You don't know anything about his background -- he may have a degree. You don't even know if it's his capital that he's trading (he said he's a prop trader -- if he's a true prop trader he didn't have to put up any capital).

    @bhardy307 -- ignore this guy and focus on learning how to trade. Don't worry about making money fast. Focus on mastering the process and the mechanics of trading. If you do that with a sound strategy, the money will come.
  8. Thanks everyone for your input.

    Yes, each of you have made good points. Given the comments made by a couple of you, I will give my background.

    Actually, I have two degrees: B of Math/Computer Math, B of A in Economics. A prof of mine recommended a brief introduction with a Prop firm. I am following my prof's recommendation.

    I am an older guy (40) who has many years of experience as a computer programmer. Rather interested in Quantitative/Algorithmic Trading. With no previous trading experience, I am only just starting to consider very basic strategies.

    I began with a very simple strategy. We are provided with the level 2 quotes. It shows a long sequence of bids and offers for a particular stock. From this you get some idea of the supply and demand for a stock. Initially, I misread this and spent the first couple of hours losing badly. Later, I combined this approach together with following the MACD. I found I was very successfully able go long on the way up and short on the way down. By the end of the day, I had recovered what I had lost. I was very strict with my losing trades, and got out quickly ( except for one, where I was stupidly stubborn. it worked in my favor. I was lucky! ).

    Also, I am trading entirely with the firm's money. I have signed no documents, and for now I am not responsible for any losses. We are flattened and stopped for the day if we fall below $50. At this point a 5 minute timer comes up giving us 5 minutes to correct the loss. We are allowed to lose a maximum of $80 if we start to lose from a positive position. i.e up $200, drop $80, you're done for the day. Obviously, these limits will increase when I graduate from student trader status. $30/share is a suggested price limit since we are forced to trade with 100 shares or more. This leaves a little leeway to go long(er) or short(er) if a trade is going well. I can take as many months as needed to achieve the $2000, but the $2000 must be a one month profit.

    Thanks for your input; please, keep it coming.
  9. Ok, I just replied with a long response a few hours ago, but it didn't show up. I think there is a long delay because I am new.

    Let's see if this one appears immediately.
  10. Lucias


    I feel you are going about this wrong. Toss the indicators. I'm not going to tell you how to trade though. If you want training from me then you would have to pay up.

    What you are doing is fundamentally wrong, you are choosing an arbitrary systematic method that has no systematic basis for working.

    Also if I were you, I'd do what your senior mentor/trader says and not listen to anyone else. Someone who makes money.

    One thing you could try to keep you in the game (but that has no real edge) is just take long trades. This will work as long as the market keeps going up.

    BTW are you with title per chance? It sounds like they aren't giving you much room. With those loss limits, you don't need to worry about cutting any losers.

    EVERY rule has an implicit assumption. If I set a rule/goal "be consistent" then this implies that being consistent has logical but being consistent is only rational/logical IF the market is consistently the same (stationary) which it is not. If my rule is TAKE EVERY TRADE that my system signals but my system doesn't have an edge then taking every trade will be losing.

    If my rule is to be disciplined.. what is disciplined? I will limit my times of trading, my markets, etc. being disciplined may or may not have any correlation to being profitable. ONLY if those rules produce profitability!

    What I find that works better then rules is principles because principles allow profiting from rare opportunity. Prefer to think in principles over rules.

    It sounds like you have no observational model for success. I see many new traders fall into this trap. In other words, it sounds like you haven't even observed the market but have already built a profitable trading system. Congratulations! Instead of focusing on trading, you should start to focus on the market.

    What basis do you have to believe you were "stupidly stubborn"? Your behavior produced a win. Where did this knowledge you posses about cutting losing trades come from? Why do you believe you were lucky?

    I'm trying to help you. Hope you see that. One thing that will help you is to go ahead and take full responsibility for all wins and losses. I'm stating you need to right now accept there is no luck involved.

    There are 2 spectrum of trader psychology: internalizing and externalizing. That is one can associate a win or loss to one's own actions or to external actions.

    By saying you were "lucky" indicates that you did not produce your win, indicating externality, indicating non control. This modal operation tends to be more useful for traders who have working systems, which you don't indicate that you possess. It is most useful for trading highly painful methods which you are not given enough rope to even try that.

    Given this, right now you need to accept EVERY win and every loss is 100% your own. No luck involved. No chance. No randomness. This will put you ahead of the pack by over a mile.
    #10     Feb 20, 2011