Tips for a new Proprietary Trader?

Discussion in 'Prop Firms' started by warrenbuffet, Nov 5, 2005.

  1. Hey guys,

    I just got a job as a proprietary trader and will be starting next monday. I will be doing mostly observations and a lot of learning from the senior traders for the first couple of days or week.

    I would certainly like to hear any tips or advice from anyone already in the market.

    By the way, i'm also thinking of subscribing to a few publications and was wondering if anyone could suggest a few good ones?

    Should i go for the wall street journal, or barrons?

    And how are magazines like these: newsweek, businessweek, the economist, forbest, fortune, smartmoney.... and are there any good magazines dedicated to traders?

    Hope to hear from you all soon.
    I am so excited about this job.
     
  2. what's a signal service? =)
     
  3. bighog

    bighog Guest

    This is great stuff.....:D

    Sorry, could not resist....:)
     
  4. Number one, trade small size. Very small, embarrassingly small, until you are making money consistently. Then take your size up at a very slow rate. You have to adapt to the mental aspect of increased size, and it takes time.

    Number two, expose yourself to as many different styles as you can. Work on any ideas that come to you, either original or a modification of what you've seen elsewhere. You have to find something that is a match for your personality and that you can have some confidence in. Put in a lot of long days making something your own.

    Number three, all those publications you mentioned are what the sheep read that you are trying to fleece. You only need to concern yourself with how the market reacts to news. Trying to interpret the news or holding beliefs based on what you read are habits that will cost you money over time. Best to start each day without any biases at all.

    Number four, and this is a hard one for most people, is to try to forget about the money. Your goal is only to trade well. If you do that, the money will come as a result. Stressing over your P/L will distract you and color your decision making. This one takes some time, but is essential to take your trading to a higher level. If you don't have enough cash put aside to live off of and you need to make money to eat, then you are over a barrel to begin with and should re-think trading at this time. You'll be scared money and scared money can't win.

    Good luck
     
  5. Choad

    Choad

    Absolutely spot-on. I only trade part time with automated systems, but every single point lescor made should be etched into your psyche. It applies to anybody learning trading, in any market, with any method, IMHO.

    It takes patience - patience that most don't have. And those most are, guess what, those famous "95% that fail...".

    Take your time to learn. Learn, don't burn! The markets WILL be there tomorrow.

    Good luck.

    C
     
  6. Get the book Techinical Analysis of Stock Trends by Edward and Magee and learn how to determine price trends.
     
  7. Filter out all the noise.

    Focus on 1 - 2 stocks for starters. Once you see patterns, pull the trigger.
     
  8. i'm loving these replies, please keep them coming! haha

    Hey lescor, yes i agree with you that all these magazine publications could put you in a bias position, but aren't they still a good source since at least they inform you on all the news that are happening?

    Also i am starting work soon with a company called PTG Capital. www.ptgcapital.com
    I was wondering if anyone have heard of them or know of their reputation and ethics? Because there is a initial deposit i have to put in, although once i have proven myself as someone who's not coming into the company simply to gamble away their 50,000, then i'm allowed to take it back eventually. Anyway, i like to hear your opinions about the company. And since this is my first career job as a prop. trader, i'm hoping that I will be able to learn a lot from this firm, set a good foundation, and be on my way to becoming a better trader.

    I was also scheduled for interviews with Echotrade online, and alpine securities group. Now these two seem to have a more formal training program from what they told me, but since both of them are stationed in ny, i decided to go with ptgcapital because it's near where i live, and since as a beginner trader who will most likely not make any money in the initial 3-4 months, i have made the decision not to followed up with those 2 companies, because if i get an apartment in ny and dont see money coming in for months, it'll be a real pain in the ass to figure out how i'm going to pay the rent. =\
    So i'm hoping that my first experience with ptgcapital will be a positive one; one that will put me on the right path for a brilliant career. =)

    As of now, i'm keeping tabs on the Birdflu pandemic, keeping myself updated and checking the prices of a few companies that produce the flu vaccines, companies such as Chiron, Novartis (who recently aquired all the shares of chiron and formed a merge with them), Gilead Science, and a few others.

    In addition, i'm also keeping an eye on the progress Merck is making, trying to see when this company will turn around and when exactly they will have these cases settled. (the nj case is no doubt a great victory for them, it'll probably cut down a lot of the cases they will have to deal with, but they still have a long way to go.)

    Also, i'm listening to the audiobook of "Come into my trading room" What do you guys think of this book? Or should i get that Tech. analysis book that guy suggested as soon as possible?

    And which is better the wallstreet journal or barron? And what are some magazines and websites do you guys use for updating yourself with news and what's going on in the market.

    the web pages i use so far are: www.marketwatch.com and yahoo's finance. I would certainly love to have a repertoir of them in my arsenal, so i'll have more resources to fall back on. =)

    Sorry for such a lengthy post, I apologize for it, but i just have so many questions, and i'm so excited about this job. =)

    Hope to hear back from you all soon.
     
  9. The first thing you must learn is to understand what your time frame is as a trader. If your trade time frame is measured in minutes, obviously you cannot allow much movement against you because you will find it too hard to make back. Don't confuse your timeframes, for example, by turning a failed trade into an "investment."

    Second, you must make it an obsession to trade only with the prevailing trend. A good strategy is to enter on pullbacks in a trend, but you must guard against taking counter-trend trades. They look enticing, but will end up killing you.

    Third, you must learn that price trumps everything else. You may be totally sure that a stock will rally eventually, but you can blow your month waiting for it.

    Fourth, be wary of prop shops that pressure you to trade dozens of times a day. It's how mcuh you make, not how many trades you do that counts. Commish adds up rapidly, for you as well as the broker.

    Finally, I think reading and learning as much as possible is great, but you have to remember that everything you read in the Journal or Barrons is old news and likely put there by someone with an agenda.
     
  10. *You will learn more from your mistakes than from your successes.

    *Lescor & AAA know what they're talking about.

    *$50,000 (leveraged 30-1, I assume?) is just too much to put at risk for a newbie trader. (Unless 50K is less than 5% of your net worth, you can't get psychologically motivated on smaller amounts, and you're willing to sacrifice 50K in order to learn faster.

    *PTG? Never heard of them. Unless 'PTG' is the new name for Pro Trader/ETG. In that case:
    http://www.elitetrader.com/br/?action=view&R_FirmID=66

    * Briefing.com platinum service has a better signal to noise ratio (For daytraders) than all of the other financial press listed so far in this thread.

    *Echo is great. The system rarely crashes, your capital is relatively secure, and Echo employees tend to do their job properly- a rarity in any field. However, I have seen no evidence to indicate that you'll receive (priceless and extremely rare) solid training and mentorship from them. Schonfeld (or even better, a successful hedge fund) would be your best shot at attaining decent training.

    * Keep browsing Elite Trader, and you'll learn alot. Some posters here are knowledgeable, successful, and helpful. Some are professional assholes (ZZZzzzzzzz is their leader), and most fall into neither category. Eventually, you'll probably be able to distinguish between those you want to pay attention to...and those who are best ignored.

    *Good Luck!

     
    #10     Nov 5, 2005