How the HELL do traders make money daytrading? Makes no sense.
First off, is it true that first/second year traders are given only about $50,000 of the firm's money to trade? Given that stocks rarely go up more than a few percentage points a day, how the HELL do they make any money doing daytrading?
If they buy a stock at 10AM and sell it in the afternoon after going up 1-5%, which is still hard to predict unless you're really really good at it, that still isn't much after deducting commissions and what you owe the firm.
Even if the 50k was upped to 100k, it's STILL NOT MUCH to live on. How the HECK do traders make ANY money??
Someone explain this to me. Given $50k, potentially how much can a trader make in a year, ASSUMING 100% of every stock he picks goes up a few percentage points and he never has a losing stock.
Traders make their supplemental income from slinging dope and pimpin hoes
This isn't how most traders (at respected prop shops/hedge funds/banks/etc.) trade, ergo, the reason for having a disconnect. If there is a place that only give $50k (kind of doubt that if it is a well capitalized firm), that is likely for the margin account, so they can be dealing with significantly more size than you could with your own personal account.
screen names are getting more and more amazing on this site
well, if we are talking about prop traders, it also depends on the firm. Example, RBC's prop team in Toronto is very chill and laid back. The boss is a super cool guy and the traders take home 1/2 of what they make. Obviously the first year is "meh" because you are building your "reserve", but then, the flood gates are opened and you get to trade a boat load. The guy who sat next to me, 25 yrs old, econ major, made a mil overall and took home 500k every year, now that's good money. But, not everyone is this good, so the business is risky and exit ops don't really exist.
Remember: "There is never a good ex-trader" :)
OP
You are looking at one interval [open, close] and not the intervals where most traders make money. For example, let n equal hours greater than open but not equal open then you get this interval [open+n, close] during open +n stock prices go up and down thus, the daily close % of open is not the true maximum profit traders can make.Also, the function of the stock market is not linear it is at best trigonometric. Don't forget traders can also short stocks where F(x) is decreasing and margin it to the max while F(x) is rising. In conclusion, fuck your couch
LMAO FUCK YOURSELF
Woah. Trigonometric Markets.
I kind of agree with the poster. I have worked at an algo shop and now a macro trading shop.
I simply do not understand trading shops who have 30 traders who are only allowed to trade intra-day positions. In other words they cannot carry any overnight risk.
I am of the impression if you flip a coin a few times you might come on top in the short run...but flip it 2k times and your gunna probably come up flat.
Also worth pointing out is that traders can make money no matter which direction the market moves...up or down...not just up.
Regards
you guys seem all to be really smart! perfect forum to get advice. Especially if you are as knowledgeable when you weight in on important decisions for people in this forum. Way to go!
Coming from you, I couldn't in a million years believe this wasn't said in a condescending manner, lol.
Regards
LEVERAGE and a compounding account will sure help
How do traders make money day trading? was reading an article on some dude from England who trades energy. It says he is a newcomer but made $50 Million day trading.
http://www.timesonlinenow.com/tto/business/article2345843.ece
enjoy.
he is not day trading he is at one of europes biggest energy companies...
the article says nothing about day trading....
You're confusing everyone. If the analyst is given $50K, that means he's working for a firm. If he ups that to 100K, it doesn't mean he gets $50K as compensation. That just means he has a 100% return for the firm. It's all about the firm trying to see if he has potential and what he can do with the capital he was given. In essence, it's a test.
"If they buy a stock at 10AM and sell it in the afternoon after going up 1-5%"
Most day traders don't wait that long. If they do, they can probably look for another job while they're waiting for the stock to go up. They usually buy and then sell within a couple minutes. Some people are event-driven traders, meaning they wait for some good news and trade on the rally or the bounce. That can generate huge profit.
For example, and I'll be conservative in my example. They have 50K, and they trade the bounce five times for a 1% gain each time. That's 2.5K profit for the day. Say you have 200 trading days and you do that the whole time. That's 500K a year, and remember, I'm being conservative.
I was also wondering the same. How do traders make money? Is it even their own money or do they just skim off the top form their customers?
Clara
this thread is going to trigger my crack habit again
options bromeo. day trading is just gambling for people who can't play poker.
The market is doing great in 2013. That´s why it pays to trade the best bicks. Some stocks look great for a nice & profitable morning trade. Source: MomentumStockPick com
You can't even flip with 50k. It has to be a test or trial period otherwise the firms a joke. Your better off pan handling.
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