I think this has already been inferred, but you have the wrong perception of how to trade the market and until you have the right perception you will continue to lose. The only way to make money as a trader is to "not lose money"! Now, think about that.
Not having a college education has nothing to do with your current situation, although maybe having a tendency to quit and give up does. Anyone though who is willing to get the basics (HS Diploma) and then work hard and work smart has a great chance of getting ahead in America. If you look at the Forbes 400 slightly over 1/3 of them have no college education at all (about 1 in 12 have no HS Diploma either), and the no college grads have, on average, a net worth that is 20% higher vs the college grads. If you'd like to get involved in a profession (teacher, attorney, accountant, doctor etc) obviously you need the college education, and the better the college you go to the higher your chance of success in those circles. However, if you are going to be an entrepreneur then the only real requirement is intellect and tenacity. Real life example of success for entrepreneurs vs professionals would be my two best friends from HS. Chad went to Pomona College and dropped out at the end of his first year (he had maintained a high GPA, he just decided he wasnt interested in college). Jeff went to Cornell College (in Iowa, not the Ivy League Cornell University in NY), did well, then went to Des Moines University and got his DO. He did his residency at Columbia University Hospital in NYC. Jeff is now a physician for an International Aid organization in Chad(the country in Africa). He's very successful and makes a difference in the world, but he's lucky if he makes $30,000 a year. Chad(the person) stayed in the LA area after dropping out of Pomona and started and sold several business and is very wealthy, both are 32 years old, both are successful, one would have never been able to do what he is doing had he not gone to college, for the other had he finished it could have changed the timing of his entire life and who knows what would have happened.
You are a loser because you don't have any common sense. Go finish up your degree, and get yourself a good job. While doing all the paper trading at night after work. When you get a sizeable stake, then it would probably be a good time to do what you want to do. And who the hell starts their trading career in options? Most would have lost their stake before even getting started. You want a 10% stop loss, so if you lose like 5 trades, you are already out half your account and would require a 100% increase to get it back to where you started. If it doesn't work out trading, at least you have a degree and possible jobs available where you can still live a good life. That's common sense. If you want to take your $5k, and trying to learn and live off of it, then you already lost. Go read all the great traders and see how they started out, all of them had stake money, and most of them had mentors to show them the rope or teach them the right basics.
Well said, Brandonf Your post was very good, and encouraging. You are right, most of the people at the top of their career are not graduates or even done their schooling. Bill Gates, a school drop out, world richest person, and hires M.Tech etc. in his company.
This helped / helps me a lot: Pretend you are FORCED to trade as a slave by an oppressive tyrant who is FORCING you to trade with HIS money. He will kill you if you lose more than 'some incredibly strict small loss (VERY strict stops)' on any one trade. So you should be deathly afraid of even nearing that hard loss amount. As soon as you come close to even half that amount, you should consider exiting. There's a caveat though. After your 5 year enslavement, the tyrant has promised to give you all that money that you got for free to use! So you think to yourself, If I can just prevent myself from losing a ton, I might be able to salvage some of this money for myself in 5 years. Since the tyrant still expects you to trade everyday though, uou decide you want to become a small loss collector. Once the stock goes against you a tiny amount, you can take the loss. You figure to yourself, if I just take incredibly small losses on all my trades, ill definitely have some left over. If you make a gain, the tyrant will like you as a trader, so he will continue your enslavement. You don't want that. For this reason, you are somewhat afraid of gains. But, you have a plan: you decide if it ever makes a profit, and becomes a huge gain, you will add to it try to cost average it somehow so that psychologically u might be able to take the trade when it goes back into a "small losing" position. Of course, you don't want to take small losses so obviously or the tyrant will know you are just trying to take all his money, so you have to make it VERY discreet. So you have to follow what is obvious about the market but con it in your favor. Since its so obvious to buy low, and sell high, as that seems to be the most profitable way of making money, you decide that you should not do that. Surely, if you pick a top or a bottom, that will maximize your profitability, so you decide you should instead buy at the top of some trending chart. Maybe as the chart starts to fall from its high, you can buy and hopefully catch the small loss as the already high stock starts to fall. then once it presents the small loss, u can take the small loss easily. What if it turns around and continues the trend? Well, u already have a plan for that, u ADD to that position trying to cost average it somehow in your favor. If you are running out of capital, and cant cost average, u are going to have to wait it out, maybe the trend will end abruptly and start going in your favor! In other words, friend, why do u think so many traders get rocked in the beginning. It's because they are focusing on the wrong things. And their risk to reward is off. They are willing to take a 20 dollar win. But only willing to take a 3000 dollar loss. should it not be the opposite? What if their broker, in an effort to help losing traders reversed ALL the buttons without the trader knowing, so buys were acutally shorts, and shorts were acutally buys. Would not that incredibly unprofitable Losing trader now turn into an incredible winner? Do the opposite of what you're doing now. Make some tweaks here and there for consistency. Take 20 dollar winners, but 10 dollar losers. Try to win 50% of the time. If you are getting into a trade that is losing you more than 10 dollars, you are too early. If the trade is taking off without you by 1 -2 cents, it's never too late. like people have said, focus on your losers. BE A LOSS COLLECTOR! and let your winners RUN. TRY DESPERATELY TO TRY TO MAKE YOUR BIG GAINS into small losses. (the EXACT opposite of what most traders do) what you'll find is your big gains actually become even bigger. THE SAME WAY YOUR BIG losses seem to be getting bigger. Trends are your friends. until the end, when it bends.
You freaked on a 2k loss? Maybe your account is under 20k? Why you even tried to make a living on such a small account. No problem here as long as you are learning. Warren Buffett delivered papers and he loved it. As Warren Buffett said: "To expect big prizes for small investments is to encourage stupid behavior". Likely, you'll end up living all your life in poverty. Most options traders lose, a plain statistic. You might get a healthy 10-25% per YEAR, conservatively selling options; but you want unreallistic goals. Billionaires are made in the stock market by managing other people money; not overleveraging and overrisking.