Is day trading/home trading dead and gone?

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Long story short traded for 18 months.

First step: prop trading, firm went under I think but they got rid of all of us before we could even know.

Next step: Did some home trading; FX and CFDs.

After that: went back into work, idea was save money and back myself.

Saved the money- however backing myself at a decent trading floor costs a heck of alot; still not too convinced about CFD trading and doubt I would find anywhere like a hedge fund or something that would back me.

I was speaking to people I met whilst prop trading, some of them with years of profitable trading experience, who are telling me the good days are gone. Its so hard out there I'm best just sticking to my job else I'm throwing good money away.

One senior trader even said he thought day trading/home trading as we know it will be dead and gone in 5 years. Only way to be a trader in his eyes was through a massive hedge fund or bank.

So............I'm still missing the trading game but obviously wondering; is day trading/home trading really a lost cause now? Are the good days over and the idea of making money off markets gone unless you have deep, deep pockets?
 
ramo88 said:
Long story

One senior trader even said he thought day trading/home trading as we know it will be dead and gone in 5 years. Only way to be a trader in his eyes was through a massive hedge fund or bank.
Click to expand...


SORRY - would have to disagree with that statement 100%

Retail trading still accounts for over 9% of the total FX market - ie larger than many banks.

Most experience retail traders know that whether there are 1 million retail traders around the world - or even 3 million - only about 5 to 10% will make money consistently and at least 70% will lose and leave between 3 months and 5 years

The churn rate will always be high - the advertising that encouraged everybody and their dog to have a go FX trading and make money - as now been seen as total exploitation by the industry - remember most of the commercial financial world is still full of clever crooks who have got away with more than murder.

I am sure things might change - as with anything but good retail FX traders still have a future - its the commercial traders that will suffer and the days of multi million bonuses will surely never be repeated - except maybe for the 2% elite

PS - is you comment another "wind up" from the commercial section:)

Regards

F
 
Forexmospherian-

no wind up, genuine question. i look at daily moves in oil and wonder if its even easy to get 300 or 400 dollars a day. thats sounds like a lot but after costs etc it's not much, as anyone with trading experience knows everyday isn't a winning day.

i just heard too many people, with experience (some who traded on the floor even) saying it's not worth it anymore. that its not like it used to be and even some of the best traders aren't making money off trading anymore.

do you solely trade FX?
 
ramo88 said:
Forexmospherian-

no wind up, genuine question. i look at daily moves in oil and wonder if its even easy to get 300 or 400 dollars a day. thats sounds like a lot but after costs etc it's not much, as anyone with trading experience knows everyday isn't a winning day.

i just heard too many people, with experience (some who traded on the floor even) saying it's not worth it anymore. that its not like it used to be and even some of the best traders aren't making money off trading anymore.

do you solely trade FX?
Click to expand...

Hi ramo88

Solely Forex and no others - not even Gold or silver

Over 13500 live trades - with 9000+ in last 4/5 years with 2013 being my best year

I am not a fortune teller - ie I never trade trying to guess an hour plus - purely short term intraday - but not all scalps as some of my trades make RR's of 5 + - all within 30 -60 mins

I have specialized purely on forex - 100% technical and time trader - have no faith in traditional trading using outdated theories - the Internet and HFT made it a new "ballgame" - you need to understand "gameplay" as much as any technicals nowadays -

I trade all market conditions - it just does not matter - with my main 5 pairs being EU / EJ / EA / GU / AU.

Trading today is easier than say 8 -10 yrs ago - simply because I understand it more and have far more experience and knowledge of all the false sentiments and tricks that go on

I cannot talk about other types of trading and other instruments - as I have barely any knowledge of their workings

So - if you like trading - and know you can do it - jump back in and enjoy :)

Regards

F
 
I think that is just the lack of volatility in the last year or so which have -apparently- made trading more difficult. But this is not a condition restricted to home based traders, look at big firms (ie. Pimco or FX Concept), they are struggling as well.

The traders who did not adapt to the new conditions are surely having a difficult time. There are no more big swings and therefore the idea many people have of becoming rich with trading in a couple of weeks is gone. Now you need sometimes to hold positions for weeks (if not months) to see a profit. And as they require constant supervision, not everybody is willing to invest the time and money required.

We all got used to 300 (or more) points swings (even hourly) in some indexes where if you catch one that was enough to live most of the year. Now the job requires deeper knowledge is more time consuming and also requires more capital. Thus many people are complaining.

In my point of view home trading is like any other business, with the same chances of success and failure. For sure there are particular circumstances which can make your own percentage higher for one of the two outcomes, but I think it is no different to open a shop or a restaurant.

Before the 95% failure brigade jumps at me, saying that there is no serious study which proves that and secondly you never say 95% in which period of time. Just that you don't waste the reply telling me something I am not interested to discuss. Thanks. Also nobody compares how difficult is to get open another business (like the one above) and getting into live trading.
 
Pferd said:
I think that is just the lack of volatility in the last year or so which have -apparently- made trading more difficult
Click to expand...

LACK of volatility. Surely you are having a bubble. Risk markets have been screaming up and down :)
 
sonofcablemonster said:
LACK of volatility. Surely you are having a bubble. Risk markets have been screaming up and down :)
Click to expand...

Obviously I am speaking broadly about the last 12-18 months and not in particular about the last four weeks. Having said that, the last four weeks have seen increased volatility, but nothing compared to what we used to have 2-3 years ago.
 
ramo88 said:
Long story short traded for 18 months.

First step: prop trading, firm went under I think but they got rid of all of us before we could even know.

Next step: Did some home trading; FX and CFDs.

After that: went back into work, idea was save money and back myself.

Saved the money- however backing myself at a decent trading floor costs a heck of alot; still not too convinced about CFD trading and doubt I would find anywhere like a hedge fund or something that would back me.

I was speaking to people I met whilst prop trading, some of them with years of profitable trading experience, who are telling me the good days are gone. Its so hard out there I'm best just sticking to my job else I'm throwing good money away.

One senior trader even said he thought day trading/home trading as we know it will be dead and gone in 5 years. Only way to be a trader in his eyes was through a massive hedge fund or bank.

So............I'm still missing the trading game but obviously wondering; is day trading/home trading really a lost cause now? Are the good days over and the idea of making money off markets gone unless you have deep, deep pockets?
Click to expand...

Trading has certainly become harder from what I hear from traders I know who are prop or ex prop (many now trade from home now with a remote connection as it saves £2000 pm). The facts are only the best are making money whereas in the past maybe a larger % of prop made money. Why is this? I don't know but what I would say is at least 50% of the trading on the popular instruments is algorithmic. The computers generally wont trade with you (against you) unless they have a positive expectation hence a lot of people get liquidated. In addition any participant without iron clad risk controls and discipline will just get run over. It seems only the smartest most disciplined traders are making money.

In short it's possible but not probable. The thing is with trading everyone thinks they have got it (until they give up). Be honest with yourself the people making money tend to have quantitative post graduate degrees and iron discipline. If you don't have these you have to ask yourself seriously are you going to make it. Whatever you do leave other career/business options open as the failure rate is high. People will say rubbish you don't need a post grad maths degree to trade but you have to ask yourself if you haven't achieved this then why haven't you. Was it lack of motivation/intelligence/opportunity, all things required to make it.

PS - a lot of the locals trading the rates are struggling and from what I can tell this is due to algos. In the past they relied on queue position to get their bread and butter fills but now these algos will sit heavy both sides of the market and wait to be hit (force your hand). Once they know your position they can bully you into liquidating.
 
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sonofcablemonster said:
It seems only the smartest most disciplined traders are making money.
Click to expand...
Id put more emphasis on disciplined but hasnt it always been that way?

sonofcablemonster said:
People will say rubbish you don't need a post grad maths degree to trade but you have to ask yourself if you haven't achieved this then why haven't you. Was it lack of motivation/intelligence/opportunity, all things required to make it.
Click to expand...
I dont have a degree, id put it down to lack of intelligence/motivation/opportunity in that order.
Do you have one? If not, and youre not algo player, do you think that conflict could be causing you some probs?
ie Im dont have a degree and dont trade algos / only smart peeps trading algos make real money
 
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darktone said:
Id put more emphasis on disciplined but hasnt it always been that way?
Click to expand...

historically it was that way floor to screen to algo infested screen. Now I dont know anyone who is making money who is not very smart and very disciplined.

darktone said:
Do you have one?
Click to expand...

Yes postgraduate Physics. it was very boring.

darktone said:
If not, and youre not algo player, do you think that conflict could be causing you some probs?
ie Im dont have a degree and dont trade algos / only smart peeps trading algos make real money
Click to expand...

No conflict. I am point and click only however I do use statistics and modelling to analyse things. I probably use psychology and market microstructure more though. For me one is useless without the other. I am starting to get into automated trading though however it is not a natural skill set for me so like anything worth having it will be a big time investment.

darktone said:
I dont have a degree, id put it down to lack of intelligence/motivation/opportunity in that order.
Click to expand...

Let me be clear imo there is NOTHING wrong with not having a degree, I am quite anti-education in some ways, I didn't turn up to my graduation as I dont care for paperwork much just waited for the paperwork in the post, simple hoop jumping for me.

People have to understand that this is a tough game where you are effectively trading AGAINST others. When you click most likely an algo with a positive EV is the other side of your trade, these people have PHDs and are highly motivated individuals.

Have you considered completing a quantitative degree through distance learning?

I am a very average poker player, there is no way in the world I would sit down at a high stakes table as I would get crushed over time. It doesnt matter how discplined I play without the skill set I would be destroyed.
 
Last edited by a moderator:
sonofcablemonster said:
No conflict. I am point and click only however I do use statistics and modelling to analyse things. I probably use psychology and market microstructure more though. For me one is useless without the other. I am starting to get into automated trading though however it is not a natural skill set for me so like anything worth having it will be a big time investment.
Click to expand...

iirc you use Ninja?
Why not try a half way house to start with.
Discretionary entry, then use Ninjas ATM for management and exit.
You can still test it reasonably quickly.

C:\Documents and Settings\PC name\My Documents\NinjaTrader 7\db
Find the Ninja SDF in there, holds all live and sim trade data.
Copy paste to a backup folder.
Advance to new day, copy paste previous days SDF into folder,
take entry, set replay speed to 500x, let ATM handle the rest.
Then copy SDF to backup - rinse and repeat.

Tip - as SDF filesize grows (larger than 10mb) loading times become slow.
Basically down to Ninja relying on .net framework for certain database duties.
Workaround is to have a copy of a blank SDF.
Paste blank SDF into this folder before advancing to next day (backup SDf with trade data first though):
C:\Documents and Settings\PC name\My Documents\NinjaTrader 7\db

The above is a much easier start, or try Ninjas code wizard:
http://www.youtube.com/watch?v=MaaqCBoqYxI&feature=c4-overview-vl&list=PL4D56536A44DD7105
Code wizard is very basic though, unsurprisingly indicators feature heavily,
so you will have to work hard to get around that limitation.
Other than that, its full on C# time:

Basic tutorials:
http://www.csharp-station.com/Tutorial.aspx
http://www.pvtuts.com/csharp/csharp-introduction

http://msdn.microsoft.com/en-us/library/67ef8sbd.aspx
http://msdn.microsoft.com/en-us/library/618ayhy6.aspx
http://stackoverflow.com/
 
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Liquid validity said:
iirc you use Ninja?
Why not try a half way house to start with.
Discretionary entry, then use Ninjas ATM for management and exit.
You can still test it reasonably quickly.

C:\Documents and Settings\PC name\My Documents\NinjaTrader 7\db
Find the Ninja SDF in there, holds all live and sim trade data.
Copy paste to a backup folder.
Advance to new day, copy paste previous days SDF into folder,
take entry, set replay speed to 500x, let ATM handle the rest.
Then copy SDF to backup - rinse and repeat.

Tip - as SDF filesize grows (larger than 10mb) loading times become slow.
Basically down to Ninja relying on .net framework for certain database duties.
Workaround is to have a copy of a blank SDF.
Paste blank SDF into this folder before advancing to next day (backup SDf with trade data first though):
C:\Documents and Settings\PC name\My Documents\NinjaTrader 7\db

The above is a much easier start, or try Ninjas code wizard:
http://www.youtube.com/watch?v=MaaqCBoqYxI&feature=c4-overview-vl&list=PL4D56536A44DD7105
Code wizard is very basic though, unsurprisingly indicators feature heavily,
so you will have to work hard to get around that limitation.
Other than that, its full on C# time:

Basic tutorials:
http://www.cprogramming.com/tutorial.html#c++tutorial
http://www.csharp-station.com/Tutorial.aspx
http://www.pvtuts.com/csharp/csharp-introduction

http://msdn.microsoft.com/en-us/library/67ef8sbd.aspx
http://msdn.microsoft.com/en-us/library/618ayhy6.aspx
http://stackoverflow.com/
Click to expand...

thanks LV. I was going to hit you and departed Random up for the best way to go. yeah I use Ninja & TT, TT much better for profiles.

For me it would very much be the raw C route. I would definitely like to do some modelling and I know I have to put the time in to get the reward.
 
sonofcablemonster said:
thanks LV. I was going to hit you and departed Random up for the best way to go. yeah I use Ninja & TT, TT much better for profiles.

For me it would very much be the raw C route. I would definitely like to do some modelling and I know I have to put the time in to get the reward.
Click to expand...
I've seen you mention using the tape quite a few times.
Trying to program anything that utilises the tape is getting
into pretty high end stuff (HFT quant type techniques).
Discretionary entry and ATM would allow you to use the tape for entry.
You could also use TT profiles, but take trade with Ninja ATM, or stay within X trader.
Just a thought, as complex C# coding can make you pull your hair out
unless you are very good (which I am not).
 
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Seriously DT, if you think that stuff is the soft option it isn't,
personally I actually think the likelihood of failure is higher.
Its an area riddled with all sorts of traps & pitfalls.
Not trying to put you off at all, just letting you know the kind of curve
you are up against :)

If that doesn't bother you, all good.
 
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