Totally agree! I've done both, and I hate trading for others. Stressful as hell, and you have to come to work every day. Much rather trade my own money.
This is a good point. Percentage return is always a function of leverage or lack thereof. 10% a month using futures and minimum margin is far different than accomplishing that using stock paid in full. So the question is if you put up $3500 overnight margin to daytrade 1 ES contract, or only $500 intraday margin with some firms and then make 1 point what is your percentage return? Your dollar return, excluding comms, is $50 but is your percentage return for the day $50/$3500, $50/$500, or $50/$75000 for the full price of the contract?
If you have $10 k in currency market it isnt hard to make $1000 per month. I have only been making consistent profits in the last 12months or so. Thats 2 contracts only making 50 pips for the whole month. The problem is greed . Who wants to only make $1000 per month . You then start taking risk putting on trades every day to double your money .If you only had to make 50 -70 pips a month you could wait for the perfect setup and only trade say 1-2 times a week. That would take a lot of control on my part to wait 2-3 days for the perfect setup. I am not saying i am a good trader. I am just putting the question out there if its better to risk other peoples money or my own when you make the commitment to go fulltime?
Wanna lose friends and family? Well just trade their money.........my question would be this.............Could you REALLY charge a family member to trade their account? could you feel right doing that? So why bother? Tell friends or family members you value their love and friendship more than you value money. Heck, when i was LEARNING to trade and had a tough go at first and ran the savings down, accepted a divorce as she sought security elsewhere, etc, etc, i do not remember anyone throwing job offers and money my way. Do your own thing............. enjoy the fruits of your labor, you deserve it because you did the grunt work not them. and as for OPM.........NO WAY Some dipshit calls me and complains, i would say: TOUGH SHIT!!! Who needs others bothering a prefectly good guy doing his thing? //
In the book Market Wizards and New Market Wizards by Jack Schwager, a lot of the trader's that were interviewed stated that trading other people's money was more burden then it was worth. Even though the clients had invested money with the trader, their own psychology got in the way where they would call the trader's on a daily basis asking how their account was doing or hearing some sort of news on Television they would call and ask about that. I can see where it would drive a trader nuts and put undo pressure upon him. There was however one trader in particular who paid the client back if he lost money, how could you go wrong with that deal? LOL, anyway's I would not want the responsibility of trading someone else's money because I know how money and psychology work, I have been there, felt it. Just a tidbit of info. 5k invested with Ed Seykota in 1972 would have been up over 250,000 % in 1988, on a cash-on-cash basis meaning it was normalized for withdrawals, really it was up several million %, if Ed can do it, you can do it with enough willingness. When your WHY is big enough, you will figure out the HOW to.
i've been trading dow puts/calls, oil puts/calls, and the VIX puts/calls between the two others when things get really ugly.
I can't imagine a more stressful way to trade. If you are up that's great, although it will never be enough for you customers as they point to Should you have to make calls and try to explain how the recent subprime market is doing, or why DNDN did what it did over night, you better have a suitcase packed.