Where do I start?

Discussion in 'Professional Trading' started by vk60546, Jun 25, 2006.

  1. WM, you are a NEWBIE yourself!! What do you think you are qualified to offer so much advice on these forums? I have read your posts, it sounds like you have just recently started yourself.

    You sound like the new "Coolweb". Zero (or very little) experience but full of criticism and advice for others.

     
    #11     Jun 25, 2006
  2. cybertrader has a program where you can trade funny money
     
    #12     Jun 25, 2006
  3. You don't know me (personally).
    I don't know you either.
    I may or may not be a newbie, but that's not the point.

    The main point is, be objective. :D
    If the points are correct, then agree. If not, be calm and state the reasons.

    It doesn't matter where the points/posts come from. Even if it's vk60546 who give points/advice, does it mean he must be wrong?

    It seems to me you think "advanced or legendary traders" are usually, if not always, correct; no matter what they say. They always have rights to say anything relating to trading. "Beginner or newbie" are usually, if not always, wrong; no matter what they say. So who are they to give any opinion or advice? Just shut up! :(

    Judge from the points, NOT people. :D

    Or do you think the advice of "daytrading is NOT suitable for newbies" is wrong? If so, I would like to hear why.

    My 2 cents anyway.
    Don't be too angry if you disagree.
    Happy posting. :)

    PS: By the way, objectivity is important too in trading. You can't be biased towards long or short, one stock over another. I know someone personally who are seriously biased towards "shorts/bears". One of the reasons is he once earned much in a bear market. It seems he couldn't get out of it afterward. He has been married to the bear. LOL :D
     
    #13     Jun 25, 2006
  4. Inexperience

    Lack of education

    Lack of maturity


    This is pretty much why newbies do not make money. The environment is too complex to be taken in quickly. What money a newbies might have is too quickly lost, either through a mistake in judgement or simple keystroke error.

    As to lack of education, it is obvious again. Most newbies do not have any applicable background. They usually have not studied their target market. They generally do not know the rules of the exchange where they intend to trade. Quite often they do not even know how to properly use their own software. They do not do their own research (because they do not know how) but instead "adopt" an approach because they have read that it works (on websites like ET).

    Lack of maturity is simply, lack of judgement and apparent disrespect for the effort it takes to make money. Newbies are apparently willing to throw money away by trading before they are prepared. To a newbie it is simply a matter of saving it up again. Ask a trader who has busted his account how long it took to save it again and you will see the difference.

    Newbies have an important place in the current market. Because liquidity has slowed way down, they represent "cannon fodder". They are sacrificial lambs, bringing money into the market at times when it needs capital. I am very appreciative.

    Thanks Newbies,
    Steve
     
    #14     Jun 25, 2006
  5. Considering 9/10 traders ultimately fail, yes, I do think that experienced traders on this board have a lot more credibility than guys like you. I have read your posts and they dont convince me that you have been in the trading trenches yourself (or, if so, then not long). Alot of what you write sounds like you regurgitated it directly from a book.

    You seem to be a guy who needs to read all he can on everything related to trading, before testing the waters. It seems that you do this b/c you are trying to avoid being wrong and hoping that reading (and learning from other traders mistakes) will allow you to avoid taking losses altogether. The fact that you "get upset" when you lose in your sim account says a lot about you in this respect. Losing truly hurts you and this mentality in trading will ultimately lead to failure. You cant be afraid to lose, and you must learn from your OWN mistakes. Thats the only way to improve. I dont care if you've read every technical analysis book or every story on every single trader ever written, this will not fully prepare you for successful trading

    Now to some of your points. You say books are the best teachers....I disagree. The best teacher is the market itself. It will tell you if you are making the correct reads and plays. There is no substitute for REAL trading experience. Book are abstract. I'm not saying books arent helpful, because they are. But they shouldnt be #1 on your list.

    Also, you mention trading discipline cannot be learned from the markets. Of course you must know this is false. After trading for awhile, you will start to see when you should be trading and when you should sit on your hands and wait for only the very best setups. If you are reading the tape/price action right, you will be able to see when to open up your game or slow it down. Again this comes from experience. There is no way you'll already know when to be extra disciplined or when to be more aggressive until you have traded for a good deal of time.

    Thats all I have for now, I'm not saying that you are 100% wrong on what you post, but new traders should take what you post with a grain of salt since you are new yourself and havent shown a proven track record of success.



     
    #15     Jun 25, 2006
  6. ...simple keystroke error! :(
    That's really a headache.
    I suffer from it once in a while.

    I heard one news which a prop firm entered an order wrongly (input error), resulting in a huge loss. It happened in the Japanese market. It is said the drop of NIKKEI 255 on that day is due to this wrong order. Funny but frightening story.

    If you trade frequently (eg daytrading), how do you avoid making input or keystroke errors?

    But sometimes an error happens to be your friend. It just happened recently. I made a "rather big" mistake by keeping adding short positions one day, instead of closing and re-opening positions.

    Originally my plan was similar to the following [the below IS just an example]:
    =====================
    Sell at 8500
    Buy at 8470
    Sell at 8480
    Buy at 8440
    Sell at 8440
    Buy at 8200 (Final. Reverse Position)
    =====================

    It's my strategy to close positions at the correction of the trend, and open again when there're signs that correction ends & the trend re-continues. However I kept pressing "sell" (instead of "buy").

    So what I did was:
    =====================
    Sell at 8500
    Sell at 8470
    Sell at 8480
    Sell at 8440
    Sell at 8440
    Buy at 8200 (Closed Extra. Reverse the Rest)
    =====================

    I realised this mistake after the price dropped below 8340.

    I closed the extra positions I added mistakenly, and reverse other positions as normal.

    Although this "rather big" mistake is very nice, I won't wish to see such kind of mistakes happening again.


    Money to winners are from losers.
    Newbies have huge contributions to the market, really.

    If there were no longer any newbie on one day, all learned hard before they joined the market, we are doomed, aren't we? :D
     
    #16     Jun 25, 2006
  7. There must be a lot of misunderstanding or misinterpretations in the first few goes. It's just normal.

    Just like I may misinterpret your points too. Sorry about that!

    Anyway you have misinterpreted me too at least in 2 parts (although all should be my own faults of unclear elaboration):
    - hoping to avoid taking losses altogether
    - trading discipline cannot be learned from the markets

    Clarity: You can never avoid losses in the market. Losses are part of your trading. No one, even the legendary ones, CAN escape from them.

    You avoid losses at full strength. You avoid profits at full strength at the same time.

    Treat losses as costs/expenses in a business. What we do is to keep losses small and let profits run (most people who read books will hear this wisdom)

    But that's doesn't mean a newbie should just jump into the market and trade. These losses (and a whole lot of silly mistakes) are meaningless AND unnecessary.

    There're much better way to learn than trading now (as a newbie). Market is NOT the best starter for newbies.

    I don't understand why, if I interpret correctly, you would like to tell newbies to trade in the market to learn (now).

    Again my two cents only.



    Agree! You can't be afraid of taking losses.

    I don't agree "you MUST learn from your OWN mistakes".

    I tend to agree "one SHOULD/CAN learn from one's own AND others' mistakes. Others' mistakes are still valuable to you. You don't need to make EVERY mistake in trading YOURSELF before you can learn EVERYTHING!"

    I don't agree "learning from your OWN mistakes is the only way to improve."

    I disagree with the word "only". This is just one of the ways. There're other ways too.


    Although I say "the best", it really means one of the best. Practice/Research of the market are also very great. I learn much when I do my research. Although I place books as the first point "practice/research" second, they are both very good sources of learning.

    I forget to say, learning a few quality books is much better than learning from lots of "average" or "substandard" books. A few books will give you most of what you need about trading ideas or edges etc.

    Sure if you are here to learn basic stuff (eg what's a stock market), introductory books may do a good job.


    I'm not saying "trading discipline cannot be learned from the markets".

    I'm saying "market is NOT the only place to learn discipline". I did say lots of people need to get burnt (learnt from the market) before they can be disciplined. Some people may learn after 1 painful mistake. Others may never learn even after tons of msitakes. Their psychology suxks. :(

    ==================

    After all, as I said, they are all my two cents, NOT some authoritative ideas/opinions/advice everyone must follow.

    Don't get burnt/angry after reading this post.

    Thanks for your time.
    See you! Bye!
     
    #17     Jun 25, 2006
  8. New ideas about sim trading

    The following is my TWO CENTS only. Read it as you own risks:
    ========================================================

    I think most people will misunderstand or misinterpret the following for all sorts of reasons. Anyway I try my best to explain it.

    This is probably the last time to mention this idea in the forum.

    What I intend to say is I think this IS also a way to learn how to control one's psychology AND discipline (ALTHOUGH most people will fail, for obvious reasons):
    - sim trade
    - treat as if you are trading real. You MEAN it for every decision you made in sim trade (probably the most difficult part! Most people fail!)
    - remember how you perform in sim trade
    - do EXACTLY what you did in sim trading WHEN you trade real

    Pre-requisite: You simulate the situations as realistically as what you (will) do/did when trading real, including capital & money management & strategies & so on.

    Reasoning: IF you STILL perform WELL and CONTINUOUSLY in sim trading (AND after some pessimistic discounting), why don't you just do EXACTLY the same when you trade real? You will be rewarded as proved in your sim trading. Placing money alone will not change the fact (Note: Sure this is just true for most people in most normal circumstances. Other factors might kick into play, say, when your capital becomes large!)

    Is it really so hard for people to understand "this strange point'? If you are determined to win the market, do what IS performing, NOT what is NOT performing. "Letting your emotions flying everywhere to control your trading" is a sure-fire way to lose, ie what is NOT performing. I understand this fully even without the need of trading real. Why others can't?

    Funny speaking, most people still like to let their emotions control their trades, ie follow what is NOT performing.

    I learn much when I sim trading. I even learn something which most people won't - psychology and discipline!

    If you follow the advice EXACTLY, you should have get used to the normal drawdown and the pressure for many instances, eg the possibility of taking losses in a row before a huge gain to cover all of them; reasonably accept some temporary drawdown will be rewarding utlimately and so on.

    Emotions should hardly affect you (seriously) if you understand and follow what I do. Frankly I may still get emotionally affected once in a while, but nearly all of them, if not all, are minor and will never lead me into major losses.
    ========================================================

    After all, this IS NOT the normal advice found in most books, from traders etc. I'm no longer going to insist on that as I feel many people will NOT understand. It isn't worth arguing. This only results in more flames and hatred.

    Finally, although I think it sounds like I'm very certain with this idea, it doesn't mean anything. It would be wrong too. Judge it yourself with your own knowledge. Forget completely what I say if you still disagree!

    Note: I'm not going to mention this point/idea in future. I will replace this with something like "learn discipline/emotion control by trading real but small", general advice most people tend to agree & understand easily.
     
    #18     Jun 25, 2006
  9. Nobody mentioned the pattern day trade rule.
     
    #19     Jun 25, 2006
  10. Different brokers have "sims" you can download. If you want to "Day trade" you have to have 25,000, but 2k will give you a margin account, but check your broker requirements.

    I think you need to read as much as you can FIRST. I agree with Steve, experience is really the only way you're going to get anywhere.

    Dont listen to anyone that tells you to open a futures account, or to trade options just because its cheaper. LOL, talk to JM about futures :)

    - nathan
     
    #20     Jun 25, 2006