Trading From Home For a Living?
I'm a 20-year-old undergrad Senior. I've been trading for 3-4 years and make consistent above-market returns. I'm interning right now, so I'm mostly swing trading. But I'm still beating the market doing that. I mostly swing and day trade equities, sometimes hedge with options and use options for volatility plays, and I've been getting into forex which is really fun and I'm doing okay in. I mostly just like trading at night because it makes me feel like I'm in a secret club.
I'm only trading about $60K right now, so I'd need to trade more dough to live on my returns and have money left to add to the account. But is it feasible to just trade my own account and live on that?
I have this vision in my head where I live alone in an apartment in Chicago. I have an awesome trading setup and I spend most days (or nights or evenings, if I see opportunity) trading my own account. And I live on what I make. And I don't have to answer to anyone. And if the market's slow, I don't have to dick around on the internet. I can leave and go read or drink or whatever I want and come back when I want to.
Is this feasible? Do people do this? This would be ideal for me, but the thought has a 'too good to be true' aura about it. I realize that I know relatively nothing and that I'm competing with very smart people. But I've been thinking my returns are just luck for three years, and I keep making money.
Am I delusional or should I pursue this goal?
You realize we've been in a 4 year rally right? What happens when we hit a double dip recession or if you get wiped out on a huge position?
You need a large enough base before you can seriously consider doing this.
I realize this. But, 1. Even in an uptrend, I've been beating the market more often than it beats me, leading to relatively consistent gains. 2. I'm not long-only, so I can see myself making money in any market. 3. I don't see how I'd get wiped out as I use stops when appropriate. And I don't put all of my money into some risky shit that could wipe me out. I mean, come on. 4. I realize I'd need more funds. I might work for a few years after ugrad and save to get more money. Or I could start using leverage. I should really do this anyway, but I lean conservative.
The good/bad thing about forex is that you can leverage up to 400:1, but I would say that around 100:1 is more typical.
As said before, one big loss and you are out with a leverage like that
I'm still learning forex. All of my money has been made on equities and options. But just because it's possible to employ massive leverage doesn't mean one must do so. One also doesn't have to put all of one's capital on the line. And one has the ability to employ stops. And mostly to use discretion.
You have 3-4 years of experience in a rally.
I would hold off.
OP, if you've made decent money on the short side given an adequate sample of trades, the "we've been in a bull market" thing doesn't apply. How did you perform during recent major declines like the s&p downgrade of 2011? Also, are you usually a net buyer or net seller of options? You should also be able to understand why you're outperforming others (I.e identify your edge) and be able to explain your strategy in a precise manner. Otherwise, you're a victim of randomness. How many trades have you made? What are your return and drawdown statistics?
This is precisely why you should be very critical about any advice you receive over the Internet. 100:1 is typical in FX...
I should have clarified. I intend to graduate and I'll probably work for a few years and keep trading on the side. Unless I think I can make more than a starting salary in 2015. I'd even trade for less than a salary I could get because it's so fun. But I still gotta eat.
I want to know whether my goal is feasible. I don't know anyone living on personal trading. I don't know how many people do it. I assume they don't advertise this.
I knew a guy who did this for a living. His daughter was hot and he was quite rich.
He ended up going to jail for white collar crimes and I never quite got laid by her.
It's a cautionary tale.
Wow.....that pretty much sums it up
I know a gentleman who began trading Forex for a living with a 100K account. He trades the euro session and is back to bed before most of us wake up in the morning. He trades 10 lots at a time and only targets 10 pips per day. As you may know in Forex, 10 lots is $100 per pip at 10 pips that's about $1000 per day. Considering he trades 3 - 4 days per week you can see why he can afford to stay home. I think it is very possible but like an earlier poster said, I would be cautious with your experience having come only during a bull market. There is a quote that a rising tide floats all boats and even the most mundane trading strategy could turn a profit in a bull market where the general market direction can correct for alot of mistakes. The question is what happens in a bear or choppy market? Will you still produce above market returns? I would just go for it. YOLO. Don't want to live life asking what if? But to be cautious you may try some backtesting and maybe even wait until the next bear market to see performance before stepping out on your own.
Hah. OP, equities have been rallying since the money printer got turned on in early 09.
I can explain a lot of what I do. I like to think I have a very simple strategy (relatively obviously), but I've tried to explain what I do to people at school who trade and are less successful and I get bored of talking. It does come down to just feeling right about a trade a lot of the time; can't explain it. But it makes money more often than not.
I'm a net buyer of options, but I sell a lot of straddles and strangles. I don't know how many trades I've made. I probably average 8 trades a day when active. Sometimes, it's slow and I chill. Sometimes, I spot opportunity after opportunity.
I mirrored the market my first year, beat it by a few % the next year, had ~35% the next year, and I'm up ~35% right now. I've never had a massive drawdown. Probably 10%. I lost like 5% in 2 days when Bernanke spoke about easing off QE last month because I thought he'd go another route and placed trades accordingly. Made it back during the following 2 weeks.
Fork, come handle my investments. I pick stock like I pick football games and have only had one real success story in my life haha
It's not incredibly difficult to beat the market right now. I'm up around 48-55% after my equities went from 5% of my portfolio to 95% of my portfolio in March.
The key is to ask yourself what happens if you have a few bad months.
And if your PA account is that good, can't you go into prop trading or something?
Always remember, in forex (if you are not employing the proper stops), there is the possible for "unlimited" losses.
The thing about forex is that you will need to leverage to make some money, because, unlike in equities, forex rates usually don't move too much. Let's assume the spread is 5 pips and let's also assume that your currency pair is changing less than 1% per day, you will need quite some leverage if you want to live off forex! The reason why US$4 trillion are exchanged daily in forex is that it just takes a lot of money to make trades. There is a reason why you have to trade at least $10000 (I think) for mini-accounts and at least $100000 for normal accounts.
not quite huh?
We hooked up at least
Not at the genitals.
Why not just try out for a position in a scott trade or etrade commercial. Those people they show seem to always be doing great.
Nah there were genitals involved, namely mine. Just not genital to genital.
Like getting the ball knocked out of your hands as you're about to cross the goal line
gay
After that embarrassing display I might have to settle, you're right
Get into options trading. It's pretty much a money printer if you know what you're doing, or you could use it to hedge risks. AAPL options were a lot of fun a couple years back, BP even moreso after the oil spill. There are blatantly obvious moves by large-caps that are worth relatively little in stocks (I don't trade stocks if I expect less than 5% / week off the trade), but a ton in options. If you go for the "longshots" you can easily double/triple (or lose it all). For example, suppose someone took $500 and said, screw it, I'm not partying this Friday night, going in on some AMD options when they're at $2 or 3. Smart investors knew it was undervalued, stayed that way for a while, but it's booming (relatively) now. That $500 on $4 calls could more than 10x the money.
But yes, you could live off trading for a living. Idealist me thinks I can do 30% consistently (I've done 30% over a 2-month period this year - I figure realistically, 1% a week is easy.). Off that number, I'd only need $200k in capital to live off. But safe me, I think I should have a contingency plan - get a cheap-ish apartment, have the ability to cut down my expenses to 10% of my capital - I probably need $30k to cover basics and student loans in the Chicago suburbs, so I'd need $300k. Of course, you should consider living in a relatively low cost-of-living place to start - somewhere that you can get a $700 apartment, could take public transit, get a cheap new-ish car for $5-8k, etc. You can trade anywhere so living in an expensive city isn't worth it, especially starting off knowing that you might not always make as much as you do now.
This would be the most boring thing you could possibly do with your life. Many people enjoy going to work to talk to co-workers, meet new people, all the little things in a job that motivate you to bust your ass to get a paycheck. Working a full-time job is not just doing work, getting paid, and then going home. There's a whole other dimension that you will be missing if you just isolate yourself in your apartment trading securities.
I hate people though...
> Working a full-time job is not just doing work, getting paid, and then going home.
It absolutely is when you work for a massive corporation, work in a cubicle farm, have passive aggressive coworkers, and mostly bang out spreadsheets.
Do I not have freedom when I'm not trading? If it's boring to you, don't do it. I love it.
Would you suggest any resources to learn about options trading? I only use them to hedge and for volatility plays now.
You sound similar to me. At your age and up until last year I was managing my own E-Trade account which consistently stayed in the 80-100K range after profits.
Then I started trading options more and risking way too much and got cleaned out on a couple large positions.
If you feel like you could use some additional training, PM me and I have a training/mentor program I would strongly recommend so you don't make the same mistakes I made.
The most important part about trading/investing is money management. Ask any professional.
If I knew then what I know now about money management I would still have over 100K. But I will say that every defeat brings with it the seed of an equivalent advantage and if I didn't get cleaned out I wouldn't be where I am today. It made me way more hungry to learn even more.
Never get complacent, keep an open mind and never stop learning. Those are the mistakes I made when I had my 100K along with obviously recklessly throwing money into options and getting hammered.
I can't stop thinking about how awesome being self-sustaining from trading would be. I just want to travel all over the world, trade, and fuck sexy bitches for like 12 years.
its pretty similar to the poker lifestyle, main diff. to poker is that its much easier to figure out if you are a winning player or not...
How is it hard to figure out if you're a winner in trading or in poker?
In poker it's More straightforward because you can have sufficient sample size after a year to determine if you beat the game or not
Oh, because there's no market, just individuals. Got it.
Typical Day for a Trader? Late to bed, Early to rise??? (Originally Posted: 07/30/2009)
What is a typical day like for all you traders?
Here are some day in the life summaries. I was in equity research but these might be useful to you. More on the site if you search "day in the life"
S&T Summer Rotation: A Day in the Life - http://bit.ly/3YMQx8 and http://bit.ly/wUAgA
A day in the life of an intern in prime brokerage arbitrage - http://bit.ly/1Olvz
A day in the life on the converts, trading desk as a summer intern - http://bit.ly/2sHdS
A day in the life of a sales & trading, credit default intern - http://bit.ly/TSQ6e
A day in the life of as an intern on the US convertible bonds desk - http://bit.ly/MeI2F
A day in the life of a fixed income analytics intern - http://bit.ly/1XUaZJ
Gotta Mentor www.GottaMentor.com Connecting You to the Advice and People You Need to Achieve Your Career Goals
Early to rise is definitely fair, but the late to bed is not necessarily work related. It absolutely depends on group dynamic and on the product. For example, in FX my days were generally 6:15-7/8, Rates 6:15-7/8 and Structured Products (Mortgages) 7:30-9. The late to bed part certainly depends on yourself a lot (ignoring crazy days), I usually stay up later just because if I went to sleep at 10-11 I'd have had 2-3 hours of non-work time. Depends on the day and how exhausted you are. On the other hand... caffeine is a hell of a drug.
I've certainly had some awful days of going out on thursday (or wednesday) till 2-3, slept for 2.5 hours and come in still drunk... it can be miserable let me tell you hahah.
Trading at home versus firm. (Originally Posted: 07/13/2011)
Hello, I recently developed an interest in trading and have read a couple of introductory books on the subject matter. In Millionaire Traders I noticed that the majority of the people (if not all of them) work from personal computers at their houses. Since their software is not provided by a firm, nor are their ordering routes, or ECMs, what sort of platforms do they use? How would they trade? Do they have accounts set up with private brokers?
Also, I started a demo account with thinkorswim a while back and have learned alot from it, however, my only lamentation is that it suffers from severe delay and isn't an efficient way to gain real time market experience. Is there a better program I could use? If I wanted to day trade on my own, with my own account, what would sort of software would I need?
the other place where you can be a trader is in hedge funds
to day trade in your own account, you will need 25k at least
there are many retail brokers you can use: Schwab, TD ameritrade, think or swim, interactive brokers(more experienced), option express, fidelity....
people who live from trading at home would most likely use brokers like interactive brokers, lightspeed and if they are seriously loaded (maybe 10 million +) they might have prime brokerage accounts with investment banks and access to bloomberg terminals (very expensive).
just pick the one you like the most or that has less commission and lets you trade more products, there are reviews online.
If you are day trading, I do not recommend using the retail brokers listed above (except for interactive brokers). I would suggest interactive brokers or lightspeed as they change very low fees and are designed for day traders. i.e. scottrade has $7 trades but lightspeed you can trade 100 shares for 40 cents. If you have high volume (i.e. 1+ million shares a month) you can haggle for lower rates, which is nice.
Thank you for the responses. Yes, I think I would need something like lightspeed, because I just don't think something like thinkorswim is designed for trading. On my demo account, for example, I make a trade for, let's say, 10,000 shares of a $7.42 stock and sell it all at $7.44. I can't make that $200 profit because the commission is $150 both ways.
Also, would I really need 25k to start? Some of the people I read about started their account with just $1,000 or so dollars.
If I wanted to work for a trading firm, where would be the best place to start?
Are they going to put you in jail if you day trade with $24,999?
You are funny.
btw you don't necessarily have to day trade, it is not the only way of trading and not sure if it is even profitable now
Trading jobs are extremely difficult to come by, professional experience or college prestige is almost always necessary. To get around the day trading restriction you need to hold a position for more than 24 hours. If you want to get into a market with less money and still be able to day trade you can trade currency or comidities. These markets require complete focuse and concentration are a inherently more risky then the equity markets.
A side question: What kind of career choices do I have if I have, say, 2-3 years of successful day-trading experience? I surely can try a different prop firm; but do I really have other choices besides of trading at home?
thanks in advance.
So what I'm gathering here is that to become an entrepreneurial day trader you need to have alot of capital (practically rather than theoretical) in order to gain access to these platforms such as lightspeed. So I guess a better bet would be to join a prop firm in order to gain experience?
I asked this same question to my interviewer who has been working for 3 years. He said yes. Also, if you can get in and don't like it, you can always quit and go back home to trade by yourself. By that time you will have a little capital from working anyway.
Don't prop firms make you sign noncompete contracts to keep you out of markets for some duration?
$25k is required to buy and sell a security the same day 3 times within a 3 day period.
Check out interactive brokers, I used them for a while. The platform is great and you can set up keystrokes etc for easy order execution.
I have heard great things about Lightspeed, however due to some "Massachusetts regulations" they wouldn't allow me to open an account with them.
Commissions will rape you if you use a retail account.
Hey All
I believe the $25k is required if you are trading and require a margin account (ex: short selling, buying/writing naked options, etc) but if you are trading only long equities then $1000 should suffice to open the account. I started my account with $1000 back in University and had no problems, just limited to the type of strategies you can implement in your book. (speaking from north american perspective, maybe different in U.S? can't speak on that behalf)
Thank you for the replies. So I could use lightspeed and interactive brokers with just 1,000?
Also, what are some prop firms you could recommend to get started with?
I think you guys are confusing the kid a litte.
Nebular - you can open an account with whatever the broker's minimum is, $1k seems about right. With that account you can buy and sell stocks (or other products) as you wish. However, you may not become a "day trader" as classified by FINRA. According to FINRA a day trader is:
" The rules adopt a new term "pattern day trader," which includes any margin customer that day trades (buys then sells or sells short then buys the same security on the same day) four or more times in five business days, provided the number of day trades are more than six percent of the customer's total trading activity for that same five-day period. Under the rules, a pattern day trader must maintain minimum equity of $25,000 on any day that the customer day trades."
I thought you could be classified as a day trader whether you're trading on cash or margin, but the above only relates to margin. I'd check your broker's policies on that.
As long as you're trading less than 4 round-trip trades every 5 days there are no issues. Also, apparently if you're not using margin you're fine (again read your broker specific rules). So you can invest and make trades with $1k, but you can't be too active to be classified as a "day trader" by FINRA.
Source: http://www.finra.org/Investors/SmartInvesting/AdvancedInvesting/DayTrad…
JSinNOLA - you're a dumb ass. Good luck finding your magical broker that will allow you to day trade with under $25k
Thanks for the explanation accounting. Any advice on where to start?
I believe that in firm one is exposed and it is great way to mention in your CV cover letter if you are interested to be good in your career.Secondly , If you have some money and links to firms then there is no alternative as compared to own.
Trading from home (Originally Posted: 01/12/2010)
Does anybody have a list of firms where I could essentially trade from home? It seems like all of the prop trading firms are located in NYC or Chicago, and CLCG Trader has been very nice helping me there. But I was curious if I just wanted to stay living where I am, and not move to a big market. Thanks
So you are essentially inquiring about arcades?
Essentially yes
Here's a list of prop shops: http://www.tradersnarrative.com/list-of-proprietary-trading-firms-735.html
You'll have to sort through it though to figure out which ones match your criteria.
Go to elitetrader.com, they are more directed at that crowd.
Trading At Home - What service do you use? (Originally Posted: 06/18/2012)
What service do you guys use and why?
I have heard good and bad things about all of them, just wanted to hear from the people on the street!
Thanks, Eric
Uh, what are you trading, how often, etc?
I was just looking for a general concensus. Lets use the average standard.
Stock
$25,000-$100,000
Zecco, because of their prices.
I heard they delay execution sometimes for a little bit. How often is that a problem?
Zecco cost per transaction: 4.95 Scottrade cost per transaction: 7.00
I'm I buy and hold with low portfolio turnovers, so i don't care much for transaction costs.
I use TD Ameritrade. I have not tried any of the competitors, but I am very happy with TD. Trade Architect is quite a helpful tool. I recommend giving it a try.
I too us TD though I'm considering IB for lower margin costs
Day Trading from Home (Originally Posted: 06/16/2012)
I know very little about day trading from home. Do you have to be glued to your computer and how does it work in general? Anyone here have experience in this?
Also interested in this. People seem to be saying that Interactive Brokers is the best for low budget people, at the moment I'm using Zecco which is cheap but not useful for day trading as it takes ages for your trades to clear.
I've heard people say that its best to start with one stock/index/commodity and learn how that is affected by different news and general market sentiment. You probably would have so keep your eye on it, but you can choose different markets based on what time you have free (US - daytime/European - early morning/Asian - late nights depending on when you're busy).
Here's a good article about constructing your own (cheaper) Bloomberg alternative.
If you can't do the research to answer this question then you probably won't have the will to do what it takes to be a consistent trader...just sayin'.
To become a successful day trader you're generally glued to your screen for the whole day since the majority of the positions you enter into will be exited by day end. If you hold on longer than you're generally not considered a day trader. In the end it doesn't matter which strategy you choose as long as you figure out a way to make money.
Day Trading Setups (Originally Posted: 07/07/2012)
For all the traders/day traders/ and anyone who works on a desk what kind of tools do you guys use to trade (And i'm not referring to the number of screens you rock)
A good buddy of mine argues that the only thing you need to trade is Technical Analysis but I really beg to differ
So get at me monkeys because I'm really interested to know what you guys use:
Technical Analysis? Oscillators? Algos?
Bloomberg terminal, Credit Suisse Locus and Mechanica. You also need access to the best VWAP and TWAP execution algos.
Yep, that's pretty much what I have at home as well.
I have a variety of instruments displayed which include: 1.) FX majors and crosses 2.) 6-8 major market indicies 3.) Oil, Gold, Silver 4.) US 10-yr, USD index
All of these charts are using the same model(sorry cant get into it).
Additionally, I have two rotating shorter term intraday charts with market and composite volume profiles.
I look to capture mean-reverting and momentum based moves in a medium-high frequency capacity through algorithmic execution.
Gotta love moving average crossovers.
Day Trading as a Career (Originally Posted: 11/06/2009)
So, I've been trading in a personal account for the last few years and have done very well trading equities as well as options. I've been in search for a FT trading position but nothing has panned out. I'm from a non-target and there's no firms that come to my school for trading positions. I have done the networking and everything else but haven't given it 110%. Reason being I kind of want to do it on my own. So, I have about 30k saved up and have additional money coming to me in a few months. If I cant get a FT offer I want to start my own trading operation.
Now, It would be a big help if professionals on this site could give me practical advice. People who've been in the business or have actually started their own operation. Either PM me or post it hear.
What's your edge?
His blog is locked for invited readers now but he use to put up daily PnL stats of him and his friends who day trade anyone to see.
Trader A consistently made a killing.
Here's a cached version of one of his reports.
http://74.125.113.132/search?q=cache:J_YSvf-WWN0J:dinosaurtrader.blogsp…
Notice Trader A making $93,496 in one day. Of course not all traders are like Trader A. Dinosaur Trader for a while was consistently losing money.
Have you looked at Wolverine? I don't know much about them but they were hiring at my school and it's a complete non-target.
Wolve interviews at non-targets because it was founded and built by state school kids. Thus, they continue to try and hire them. Wolve is comparable to DRW and SIG. If you get an interview at Wolverine, you have a good chance of landing an offer, they don't give many interviews. Cory Burke is HR Manager there. Try to get an "in" before applying.
Want to Begin Day Trading (Originally Posted: 03/01/2013)
I want to begin trading my own account just to start with $500-1000 but I need the steps to accomplish this task. 1.) What software will I need to aquire? 2.) How can I start an account to put my money into? 3.)Is this enough money to begin with
Thanks.... Recommended "user friendly" online platform? and how much do you think is a good number to begin with?
Interested in this as well. Any free software out there worth looking at?
what instrument? equity? currencies?
Currencies!!!!
25k mínimum needed to day trade. Interactive Brokers or TD Ameritrade.
BT beat me to it.
You can trade with that amount but you will not be able to "day trade". Day trading requires a 25k min to allow you the ability to go in and out throughout the same day. You also won't be granted margin with such a small amount of cash which will eliminate options, short selling, and other investments. $500-$1000 is enough for an account at a Scottrade, Zecco, or a similar service which have their own platforms. Best of luck.
Just open a paper money account. You'll still get your rocks, but won't have to lose your money in the process.
Start a DRIP into your favorite name until you get that signing bonus.
To put it in context, you couldn't buy two shares of $ISRG. Factoring in taxes and commissions, your capital will dissipate a lot quicker than you might think. I have three recommendations, each independent of the other:
a) Open a virtual account somewhere, like marketwatch.com. Treat it as you might your own capital, and maybe look for stocks costing 0.7% of your portfolio per trade. Also keep in mind that market orders in real life don't immediately fill in some cases, and that you can't just click a button to short something.
B) Buy and hold. I started with $5k in college, and realized commissions would be eating me alive if I was executing multiple trades a day (or even week). Very boring and you might not learn a whole lot, other than patience (important to have nonetheless), but capital preservation should probably be your foremost goal with $1k.
C) Buy on the dip. I would go to yahoo! finance and look at the biggest losers of the day. Sometimes you'd see one lose 5% after hours for barely missing, or even meeting earnings. If I felt the market response was irrational or unjustified, I'd put in an order for the next morning or (x amount of time, you never want to catch a falling dagger), and ride it back up. Can be very rewarding if done right.
Scottrade is $7 a trade, I believe Fidelity is $8. Fixed amount per trade is probably your ideal commissions structure. Also keep in mind that in the event of a selloff or downturn, you won't have a cushion to soften your cost basis. If you only have 1 stock, rest assured it will be battered harder than will the S&P in a falling market. Be prepared to lose a big chunk of that change if something happens. In other words...you can't day trade, but you can have fun and learn a lot.
> I want to begin trading my own account just to start with $500-1000
Have you ever heard of Aerotyne International?
Day Trading (Originally Posted: 02/22/2011)
Just wondering who is interested or engages in day trading. I know it might be tough for many of us analysts and traders, but it is something i am interested in especially in up markets or volatile times that we have seen in the past year or so. I personally have heard of a few ex-analysts becoming day/swing traders full-time. Does anyone know of friends or people that have done this?
ima dai tradurrrrrr
I would like to get into the trading industry. I personally feel that all styles of trading have their advantages and disadvantages. But day trading/swing trading offers a unique set of circumstances and challenges. I find conquering the challenges presented as a trader is one of the best feelings in the world.
cool story bro
I have a family friend (about 40 y/o) that got bought out at the end of 2008. He was a MD with a Canadian BB. He now day trades, funded by his buyout package, and sits on a few boards. Must be pretty good at it because recently the family has bought a few properties around the world, new cars, etc... Tough thing to do/live off of if you can't be 100% committed and don't have a great deal of funds to invest in the first place.
Just became a day trader, getting killed in market so far. Oil thoughts?
I used to day trade using a paper account about a year ago. It's full of swings- you're up 30% one month and down 25% the next. Clearly not for the faint of heart.
Annnndd someone is now named bi-winning. You get a SB.
Yeah, this shit is tough. I'm trying my hand at calls for the first time and it's not for the timid.
Expect to lose money your first couple of months.Funding is key, that doesn't mean over leverage yourself. It also helps to work with a team. You will learn much faster if you have someone helping you along the way obviously, but it is doable yourself. It will just most likely take longer. Like I said, expect losses and frustration. Paper trading is NOTHING like actual trading. You will be quick to find you aren't as willing to risk as much in a real account as a paper account. That being said paper trading is good for creating strategies and testing those strategies. See what works first on your paper account. Start on a real account with smaller size and work your way up.
The thing is with day trading the market a lot of the easy cash that used to exist is no longer there. Inefficiencies are quickly taken advantage of. Although they still exist I personally believe they aren't the best and most reliable way to make money. The best day traders learn how to stick with a few stocks a day that have either news or are showing solid technical levels.
Professional Day Trading (Originally Posted: 06/14/2008)
Apologies if this is not the place to post this topic.
I just wanted some advice on how to setup to start daytrading $3000 in stocks/cuurencies.
What is the fastest way to get information on the interest rate decisions, CPI and such. Ive heard that eSignal is good..is it?? Which one do you guys use??
Which broker offers trading for both stocks and currencies for my balance??
Finally, is $3000 a realistic amount to setup and start trading like a professional.. apart from the skill ofcourse
You would be better off converting them to 30 $100 bills and flushing them down the toilet one at a time.
"Oh - the ladies ever tell you that you look like a fucking optical illusion?"
Two Things: 1. Esignal will cost you 1200 a year. To cover 1200 and commissions with a $3000 account wont be easy. 2. If you become what FINRA deems a "Pattern Day Trader" you need a minimum $25000 margin account. See: http://www.finra.org/InvestorInformation/InvestmentChoices/DayTradingIn…
Thanks for the reply GregWienstien I knew it was a small amount. but I just heard of this guy who is day trading with $5000.. thought I'd try it.
trade4size- I think I rather convert them to 3000 $1 bills and shove'em down your throat. But on second thought, if I flush them down the toilet..they will at least get somewhere better.
hah
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"its the running joke now, we now have fair trade with china so they send us poisoned sea food and we send them fraudulent securities."
Honestly just passing along what someone once told me. Learning to train is very tedious. no matter how hard you try you will not be able to trade like a professional with $3000. Your transaction costs will be very high. Esignal is a great charting software but outside of that theres not much to it.
My suggestion is take that $3000 and spend it on books learning about the market. Just my 2 cents. Good luck.
"Oh - the ladies ever tell you that you look like a fucking optical illusion?"
If like gambling, you're willing to accept the risk of losing some or all of that $3000, then go open an account on Scottrade which is 7 bucks a trade. I wouldn't recommend "day trading" which implies that you will be buying and selling the same stock within short periods of time as Greg's link explains. However, maybe try finding some stocks that you think will move in the short/medium term and see what you can do. It's good experience in understanding how the markets work and forces you to do some research before making a move. Not a bad way to learn; also not the cheapest. Books work too and generally carry less risk :)
Rate cuts/increases you can hear on the TV (CNBC) pretty much as soon as its announced, as with most other important numbers. I'd always try the source first though; for example the recent CPI numbers were updated on the dept. of labor's website literally at 8:30am on the dot last week.
Thanks trade4size, I think I need at least $15000 to trade like a professional. I think it would be a good idea to buy books except that I already have a ton, havnt had the time to read them.
WxOnWallStreet- I have heard a lot about Scottrade. I am thinking of giving it a shot. $3000 to learn about the market seems fair. I am trying to learn to trade on news and numbers. To do this, getting information at the same time as others is important. Also, having real-time charts would help as well. I will setup a Scottrade account this week. We'll see how it goes.
Thanks to everyone for the comments.
If you don’t have time to read, how do you have time to trade?
Check out Zecco - $4 trades, bare bones but thats all you need. The rest of the brokers throw crap at you to increase your trading volume and their profits. (see Etrade and TdAmeritrade)
Its all the about the money management and sticking to your strategy. I'm up 25% long only YTD. I finally am going to be able to short now and even put puts and calls (margin activated)
Find your own trades, they work best. Don't go follow Crammer or Fast Money, they do have good advice, except for when Crammer goes and tells you to sell APPL. (maybe a shorter-term trade due to the run up from jan, which was one of my large cap plays).
Also check out thinkorswim.com
From what I know day trading can get lonely, if you wanna make a full time living, you usually need a huge capital base
just my 2 cents
One thing you need to realize is that you won't be able to move in and out of trades as fast as you'd prefer. You need to wait a few days for your trades to be settled once you get out of a position... and with only 3gs that really sucks, there are a lot of missed opportunities.
The day something settles is irrelevent. Daytraders can still turn 100% of their account over several times per day. Please do not post inaccurate misleading information like that.
"Oh - the ladies ever tell you that you look like a fucking optical illusion?"
"Interpretations of Regulation T, which govern how trades are paid for, state that funds from liquidations in cash accounts will not be available to pay for purchases until the settlement date of the sell."
This is quoted directly from Scottrade, where the OP says he plans on setting up an account. With $3000, he will not qualify for a margin account.
Please don't call me out... what I said is much more relevant to the OP's situation than what you're talking about.
It is my understanding that you can use unsettled funds from a trade to make a purchase, however you must retain that new position until the funds used for that purchase are settled. Otherwise If you buy and sell with unsettled funds before its settled, its considered a free ride. Generally a no-no.
FYI, be sure you are aware of any regulations with personal trading if you're an intern at a bank.
yup, be careful with the rules regarding trading even if you're an intern. banks rules are typically more stringent than for hedge funds or trading shops, but either way, make sure you check it out in the big compliance manual they give you.
This does NOT seem correct. I have friends that turn their entire account over several times per day. They are margin accounts however. I am not 100% on this as I have only daytraded index futures which the rules are much much different.
"Oh - the ladies ever tell you that you look like a fucking optical illusion?"
Well if its a margin account then of course he can turnover positions left and right. The margin account means he's been extended a line of credit to act as a cushion for just those types of situations. In a non-margin account you have no credit, and by buying and selling a security with uncleared funds, before they cleared, you essentially got a free ride in that trade.
Bottom line is cash accounts suck
agreed^
Great Article on Day Trading (Originally Posted: 04/30/2016)
I think every one of us at one time or another has at least thought about walking away and day trading our own account. Most of us never do it (I did it for about 6 months and, frankly, got bored), but we can all picture ourselves living a life of relative leisure, working a couple hours a day in our underwear, and then enjoying the rest of the day doing whatever we want.
This was way more prevalent in the late '90s (when I did it), because it was really, really easy back then. All you had to do was wait for a Fed meeting, bet big on the long side of an index option that morning, and when Greenspan inevitably left rates alone or lowered them, you made money. All the dot coms were pretty reliably going up and, when in doubt, you could always buy Qualcomm.
Today, it is much tougher to make it as a day trader, but people are still trying. The New York Times just published a great article on the state of day trading, and it has some memorable quotes: On the job itself:
On the money you can make:
On the market forces lined up against you:
I've never been one to invest for the long term, and I prefer not to hold a position overnight. I wouldn't say that makes me a day trader, though. On a few recent occasions, I've bought and held. My gold trade worked out; my bear market trade didn't, and now I'm holding silver options that are good through next January. But most of the time I'm interested in what can make me money now, so I've been pleased to see the expansion in leveraged ETFs.
When I spent my 6 months as a day trader, I had an extremely narrow focus (I only traded OEX options, I paid myself every Friday, and my strategy was to make $500 a day and limit losses to $200 a day). I wasn't able to trade every day (because things don't always line up, especially when you are only trading one thing), and I was living on the West Coast at the time, so my day started at about 5 a.m. Most days, the best moves would come early, so I was generally finished by about 9 in the morning.
I'd spend a couple hours in the gym, and then I'd meet a couple of my fellow day traders (believe me, there were lots of them back then) for lunch. Which meant spending the remainder of the day drinking at the beach. Don't get me wrong; I'm not complaining. But after about 6 months I was bored stiff. I took off for a European vacation for the millennium, made a shit ton of money when QCOM split 4:1 while I was partying in the Algarve, and I never went back to day trading when I came home.
In all honesty, I'm inclined to think that online poker has supplanted day trading today. Have any of you considered day trading on your own for a living?
mod (Andy) note: "Blast from the past - Best of Eddie" If there's an old post from Eddie you'd like to see up again shoot me a message.
Nope, wouldn't do it. Around earning season I dabble in options here and there, and let me tell you I'm a pro at letting them expire worthless. I'm in FI trading 50 hrs a week, and get my kicks during that time. Not on the BuySide for much longer... merchant banking on the horizon, mid-may!
Merchant Banking? Care to elaborate?
A lot of these guys that claim to be "profitable" also seem to run supplementary "training" services which seems kind of suspicious if you ask me..
no different than former bankers that claim to love the job but went on to teach financial modelling courses...
I would never day trade. But I seriously considered quitting my job and moving to Vegas to pursue poker full-time.
i dont think it would be very fulfilling... but the hours might make it worth it
A lot of d-trading talk is suspicious given that most of these "stories" would have led towards free riding violations.
I've read a couple threads here on WSO that totally discredit Tim Sykes and the way he's made money. Isn't what he does essentially day trading? If so, why does he get such a bad rep?
Timmy made most of his money swing trading penny stocks. This was back when they traded a bit cleaner and he was able to find borrows for shorts. It's still possible to make money this way, though its tough. I did it for about a year, came out a little positive, but it wasn't worth it to me. Getting stuck in a sub-zero stock with no liquidity sucks ass. I did have times, though, where I'd get a double only to see it go up 5x or 10x. Like I said, very diffcult to do and can get quite expensive.
As someone already mentioned, he's nothing but scum now. He realized his strategy is scalable and/or he opps started o fade away so he created his current alert service.
Sykes is brilliant. Basically he buys a penny stock, tells his TIMalert subscribers (possibly in the low thousands) to buy and after it runs up he sells his position then tells his followers to sell. BRILLIANT! Legal frontrunning. Rarely loses on a trade.
I have thought about it but I don't know if I have the nerves of steel that it takes. It just seems too risky in this economy and I think you are right about the online poker thing.
Choosing this online casino will prove to be the best gambling casino online forum decision you make if you play the right casino games at the right time.
I daytraded for about 4 months. Made some money, but less then I made when I was still working. Besides, I got pretty bored being on my own all day so I got back to work. Still want to daytrade fulltime some day, but only if I can convince some friends to join me so we can rent some office space.
Daytrading is like tournament poker, except instead of trying to beat 8 people, you have to beat the market.
Honestly, unless you are super disciplined and you have a big enough amount to make transaction costs essentially negligible, its not worth it. A lot of day traders always fail to take into account the opportunity cost of using your time to do something more valuable when talking about their success in day trading.
I think we've all thought we could make money from day trading until we actually tried it. I made some good money initially but called it quits after some bad losses. You can make money once in awhile trading but to do it consistently is nearly impossible. Find some more reliable sources of income on the side.
I am very strongly considering getting back into the day trading game. My situation is unique in the sense that I have a "decent" source of income (if the guide is anything to go by, some of the incomes reported are just crap... especially if you net it after taxes i.e. transaction costs :P ), lots of free time, and work from home.
First time I tried day trading was for one of those pip-squeak prop-shops. I didn't have to put any money down, I just got 50% of any profits I made. I was a total amateur, and just scalped the spread for "C" using a floor broker. Think of it as a poor man's HFT attempt. It worked for a while too, and I made money for at least 1Q. That experience gets me craving day trading again (although I realize that kind of scalping is not possible, I think I'm a bit more experienced and may find better trading opportunities than scalping the spread).
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