All great responses! I have no bad habbits of trading since being new and young, what i've learned from the books are my only lessons and they all say the same thing- plan to not lose- well thats my strat I'll probably start off just doing round lots of inexpensive stock with prior days low as a stop loss. I know paper trading is no way to learn management, i was using it to see how my stock picking skills were though, it worked well. Like the rem of a stock op says, theres no way to tell if your right until you do it
Slave Yuppie , The masses do not know how to trade. And ETers definetly do not. Find your way and throw the books away... Michael B.
Learning to execute a trading strategy is like grooving a tennis stroke. You have to hit hundreds and hundreds of balls. Unfortunately, moving from paper or simulation to actual trading is like putting the grooved stroke into play in a match, when you may not have any idea how to win the rallies. Also, an opponent does not toss the ball into the slot for you to hit, unlike your friendly coach (who you are paying to do that). Match playing ability only develops with real trading experience. The early stages are almost invariably loss making, as most people confirm. This comes expensive, but repetitive experience in a real trading environment is the only way to develop the deep sensory-motor skills needed for successful execution. It really does seem to take a couple of years. Then there is the question what it is that you are trying to execute. Unfortunately, until you have paid for the sensory-motor skills, you will not be able to understand the strategies that you read on the boards and in the books. When you have paid your dues, you can choose which elements of strategies to execute, and will find they start to pay off in your hands (even the simplest). The reverse order just does not work
Absolutely possible to make that amount daily. No not every trader has to lose money at first. It all depends on the person and their approach to trading. The key in my opinion is survival at the beggining. Once you get an idea of how things work it gets easier. Good luck. ozzy
It sounds like you're gonna start out with swing trading. That's a smart thing to do Just don't rush into day trading without enough experience and well tested system/strategy. Okay, everybody has been talking you down, now it's time to cheer you up. There are some fortunate and talented ones that start making consistant money after 6 months or so. But of course they are a rare breed indeed. Maybe you're one of them, but you'd never know until you've tried, right? Happy trading and keep us posted on how you're doing
In my opinion, I would try to trade the lowest timeframe possible so that you get more trade opportunities, and therefore, more experience faster. Also, the lower the timeframe the higher the win/loss ratio, meaning that you will be right more than you are wrong. This will build your confidence! Be patient and wait for your setup. Also, you will have less risk because you can place your stop closer to your entry. Learn to get in and out and manage your trade. Remember rule #1 is preserve your capital and the profits will take care of themselves. Swing trading is great because it will provide you with some bigger moves, but also larger risk and you'll have less trade opportunities, which will slow down your progress. The good setups just don't seem to come as often as we would like. If you swing trade on daily charts, be careful to place your stop away from the noise. Placing your stop at the low of the previous day may be too close and you will get stopped out often. You may want to consider placing your stop about 2-3 ATRs away from your entry and then trail your stop. By the way, this is advice that was given to me in the beginning that has served me well. But this is just one approach out of many.
This sounds like a sure way to pay your broker a good deal of money... Call me ignorant but I would strongly argue that the LESS you trade at the beginning the BETTER. Look, you are fighting commissions on a very steep learning curve. If you make any profitable trades during the day the amount you actually take home will be significantly reduced if you are trading more than 5-10 times a day. Add that amount to your losing days and I hope you start to understand the point... Also, there are NO SHORTCUTS. Higher frequency does not mean more experience faster, it means more money for the brokers and the pro's. Mike
thing about swing trading i dont like the oppurtunity of big drawdowns holding positions overnight unless ive selectivly picked stocks for investment purpose
A few good comments from this thread 1) Print out each trade you do (do a screen cap) Great idea! I Will start doing this TOMORROW. 2) Keep your risk low if you are daytrading, under 0.5% You won't lose much and you'll live to play for a long time unless you lose 0.5% multiple times in one day 3) I am a breakeven daytrader that trades with good capital and I have experienced one 10% drawdown while learning and have made it all back., you definately don't have to have a 30k -> 10k drawdown to learn this business. Don't think like that, Think what you have learned, keep losts low, so you'll get to live another day. Other then that, good luck!
Let me shorten your learning curve considerably. 1. Put your $30k in the bank. Withdraw $2k to punt with. If you lose $500-1000k quit and review your plan. 2. Don't get stuck thinking its easy to make 10 cents per share off a position everyday. The hard part is how you plan to retain that 10 cents. Its easy to enter at random and take profit every time the share rise by 10 cents. The problem is that some positions will go deep into negative regions even before it reaches +10cents. These losers will wipe our your stack of 10 cents winners. 3. Learn basic Mathematics and Statistics. You can spot people who don't have knowledge of these when they tell you to scalp 10 pip or 10 cents off one trade everyday with a large position. Or they tell you that common indicators helps predict market direction. Good luck, it'll probably take you years like everyone else. Not that you're "slow" or "stupid" or anything like that. But there is just too much shit to learn and no one to teach it.