Hi, I need direction.
Hello, where should someone start if they would like to get into day trading for the opportunities it provides? I currently only have a H.S. diploma.
Trending Content
Career Resources
WSO Free Modeling Series - Now Open Through
April 30, 2024
9 Free Financial Modeling Lessons
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
+Bonus: Get 27 financial modeling templates in swipe file
+Bonus: Get 27 financial modeling templates in swipe file
Honestly, I don't recommend you day trade... To be successful in DAY trading, you need a set strategy. In order to create a strategy, you need to gain screen time to help develop market intuition and understand the technical aspect of short term trading. I'm not talking about trend lines or triangle formations, that's all a bunch of bullcrap. I'm talking about actually have a strategy you put on, not due to a personal bias. Trend lines are lines that you've created, so that's your bias. I'm saying actually looking at the market and knowing when it's relatively cheap or expensive just by looking at it, provided you have some technical edge, as well. I'm not into price action either. IMO, that's all a bunch of bullcrap. You can look at any stock right now, pull up a chart. No moving averages, no nothing. Do you know where the price is heading? No... A friend of mine, he used to be the head of VIX trading at Morgan Stanley. He even said the same thing. Every little thing helps but just don't overdo it. I used to work on a prop desk (I actually interned at BNP Paribas on their prop desk... Jesus this was a long time ago) and I'll be honest with you, I was profitable but not consistently during my learning curve. There are a lot of downsides when you're trading on your own, as opposed to a bank. Anyway, I joined a prop firm and this guy behind me never traded for a bank or a hedge fund in his life. He was always a prop trader since he came out of college. He was like ~36 when I met him. Had two kids, a wife who wasn't working and lived in a nice ass condo in the city. My guess, this guy was probably bringing in 2mm-3mm P/L annually... I remember one time, I looked over at his screen and he was putting on trades without even thinking twice about it. The great traders' trade because they know what they are doing obviously. They don't sit there and fidget on the mouse and decide whether or not to put on a trade. They look at the something and they ready know it. If they have no view, move the fuck on. Anyway, his screen had no trend lines or any of that biased crap. Listen, I'm not saying indicators don't work (NOT talking about trendlines or triangle formations), they do, if you use it correctly. But it won't work 100% of the time, I'll tell you that much. You'll lose money when you're wrong and that's fine. It's part of the job. The biggest issue with people who wants to get into trading is to look at the news and trade solely on that. For example, "Apple's earning below expectation" and they go short as soon the market opens. In short-term trading, it doesn't work like that. It's all about the market flow and seeing what the price is trading compared to its last recent price. I'll give you a tip, in short term trading, mean reversion is a lot more common than longer time frames. If I were you, go on tradingview.com and look at the charts and play around with it. Try multiple time frames and see how price reacts in different ticks. Look at the index, ETFs, single stocks... Cash equity products are the easiest to understand. That's a good start. You need understand what the indexes are and what it's comprised of. How much weight a stock has on that particular index? What are the fundamentals that may drive up or down the entire the market? How does interest rate affect certain stocks? What are sectors? What are some major stocks in that sector and if Stock A is going down, how much will stock B go down or even possibly go up? Are they diverging from each other although they are in the same sector? Why and how can I profit from this? How can I hedge a losing position? How does volatility and mean effects trading decisions? So you can learn and see if you can trade and profit from over exaggerated price movement. It's a lot to learn. But for now, get some screen time and maybe little indicators. Don't go crazy and start adding stupid shit like money flow indicators. Keep it simple.
FYI... Go get a degree.
Wow, this post deserves a WSO award, or some kind of mention
Did I seriously just write all that? I need a life.
I have spent alot of time looking for an answer like that. I am very grateful you gave me this information without trying to sell me a book or 1 on 1 convo for a 1 time fee.
"The biggest issue with people who wants to get into trading is to look at the news and trade solely on that. For example, "Apple's earning below expectation" and they go short as soon the market opens. "
I can't believe people will short off little information like that. i can never blindly do something like what you mentioned especially when i lack knowledge or if I know i am not maximizing my chances as much as I can. Makes little sense.
Which degree do i work towards? or what classes will give me the tools i need? I am going to research everything you mentioned in that post.
Thanks again.
First: I would also recommend against day trading. And I would STRONGLY recommend against day trading if you are thinking that you're going to (or you need to) make a living at it. That will not end well.
That aside: if it's something you're interested in and want to try, then for starters, I assume you have ample savings and a backup plan if things go south.
Set aside a reasonable chunk of money but only up to an amount that, if you lost it all, wouldn't be major damage either to your household finances or to your mental health / state of mind.
Start trading, and trade small - and for six months, the only thing you should be doing is learning how not to lose money. Learn how to use stop loss orders, think about your emotions when your trades go your way and when the don't (for most people, the pain of losing $100 is greater than the thrill of gaining $100).
Start from there. The vast, vast, vast majority of day traders go broke. The single most important thing you can do to be the rare winner is learn how not to lose money. Learning how to make money comes after that.
PS: Go get a degree.
First off yes, swoons post was very helpful to help me and im sure others, paint a better picture of what i attempting to get into.
If the vast majority go broke...why do they do it? Addiction? lack of self control?
It's just that I read quite a bit into day trading and understand the psychological aspects of day trading are similar to that of addiction. That's what i believe.
Honestly this is beginning to sound like something i should stay away from. The reason why I asked about day trading is because I used to play quite a bit of poker and spades in an institution I worked at, never played for money... gambling crippled my outside family. Well to put it short a life insurance salesman who was staying their said I should get into day trading, I took it lightly with a grain of salt. Just to mention people do get extremely weird during games when they lose, even when they win some people make poor clouded decisions after. Whatever I feel during these games that produce good or bad emotions, i simply curb it to stay balanced and stick to the numbers.
A year later here i am. I want to do something math intensive, because I like a challenge and once you get to a high level with math and numbers you can find out things about the world around you, business, people's behavior, language. Simply through intelligence and data. To my knowledge In usually a systematic process. I am willing to put in work to achieve that ability.
I am going to respect both your advice and put a hold on day trading for a maybe a decade and we'll see where i am at. I simply can't risk it. It is not worth it,
Right now I am refreshing what i learned in high school on khan academy online. Where should i go from their?
Chances are after you go to Khan Academy, you're still going to need a structured education. Start taking classes at a community college. Do math and any computer science they offer. That will teach you real analytical and problem solving skills you need to succeed in trading or a bunch of other potentially lucrative career paths. It probably won't be easy, which is why you can't just do it on the side on your own time. You'll need the structure of actually being in the class if you want to have any chance of success. I can't tell you how many classes I've audited half way through the course until I just got tired of going and stopped. If you get through that and you're still doing well, you need to go to a good 4-year school and get your BS. Again, I'd focus in math/CS/science-intensive disciplines. If you're still interested in finance, learn about that on the side. It's a long road, but that will give you the best odds.
Eius incidunt tempora assumenda fugit expedita nulla placeat fugit. Voluptatem iusto ut officia non veniam cum aut. Magni ab sapiente odit. Sed corrupti aut qui aut.
Aspernatur ut possimus molestiae aut dolor ipsum. Laboriosam et qui blanditiis ab optio qui. Et et reprehenderit eos et sit sit dolor. Iste vero consequuntur porro deserunt veniam soluta reiciendis. Beatae sint nihil officia sint.
Eum id non magnam aut nihil aut. Aut magni dolor qui sit omnis pariatur. Corrupti omnis officia nam aliquam. Ratione quisquam eveniet est qui nesciunt earum atque eos. Dolore modi qui aliquid voluptates tempora optio. Omnis maiores occaecati est impedit.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...