Am I About To Do Something Stupid?

[piebald_jack]

Hi everyone

Just joined after having found this site almost by default, and have already read the VS saga thread which made me wince uncomfortably several times (yes, I was one too!).

Thing is, although I'm still only 'info gathering' in as much as I know I want to get into trading but (still) don't know where to start. I have been teetering on the brink of signing up for Jeff Jevtic's one-day seminar (he of Commodity and Financial Futures Trend Research (CFTR) fame) 'Secrets of the City Traders' (discounted at £695). Latest ad appeared in Mail on Sunday...'Who else wants £12,000 per week tax-free on FTSE or Dow?'

I sent for the info pack, read the sales literature and can't believe that these sums of money are being made with such apparent ease! However, noting some of the tremendously helpful posts which appeared on the VS thread I would greatly appreciate any views or advice regarding my present situation and impending folly (or otherwise!).

Great site (from the quick look around I've had so far). Looking forward to chatting with some of you...

 

[NEILM16]

Hi PJ,
I have done both VS and CFTR.The short answer is save your money although it seems very tempting and the results look good in actual reality its really quite vague as far as entry and exit rules go!!For example u will here things like if u had entered here u would have made x amount.Then u look along the chart and ask well that looks the same sort of entry point and u ask why would we not enter there and the reply will be because of x or y or z, any reason really why?because it was losing trade!!There is alot to learn and from experience learn your own strategies and stick with them!!You will save alot of money that way!!If your are looking for good basic Technical analysis then u could try the sharecope training days with people like david jones.
I wish u well on the quest
Regards
Neil M

 

[Skimbleshanks]

I know I want to get into trading but (still) don't know where to start.

Hi piebald_jack, and welcome to T2W.

With respect, your statement above indicates to me that you should save your money, and spend a little time looking around this website, particularly FTSE Beater's thread in the First Steps board.

Before you spend any further money, you need to find out what type of trading suits you and your lifestyle, the time you have available, the size of your trading funds, your risk tolerance, etc, etc. Only when you have decided that would be the time to consider whether going on a course, or receiving private tuition, will speed you along the steep learning curve of trading.

I would suggest that there's plenty of information here, particularly from new traders like yourself, to keep you busy for about a year. Then you will have a lot of knowledge tucked under your belt and, more importantly, a better idea of what type of trading you're after.

All the worst trading courses are sold on greed - "look what fantastic money can be made for zero effort!" or words to that effect. If only it were true. If it was easy every single pension fund and endowment fund would be showing profits every year, but they're not.

Take your time ... there's a lot to learn, and the more you are in a hurry, the more chance you have of losing an awful lot of money in the markets.

 

[piebald_jack]

Thanks guys. I guessed there might be something amiss.

Neil, did you get the Gold Bars and Sign Posts from CFTR? I take it from your comments that the subsequent 'analysis' (though the literature would have you believe there isn't too much to do...'takes about 20 minutes a day...') wasn't that easy to unravel? They do make it sound foolproof though, don't they? And, to all intents and purposes, you really don't have to do anything! (A little bit like VS would have you believe!).

As you say Skimbleshanks, curiosity, impatience and (if I'm honest!) a little greed too can be played upon by clever sales literature. Guess I'll have to rethink... I'm semi-retired (took a very early retirement at 50!), and am looking to still supplement my 'pension' income as I have a relatively expensive pastime in that I have two horses. I am usually about during the day most days, but having heard and read a little about these 'systems' which use end-of-day data and analysis, feel that these would perhaps appeal most. I also like the sound of the 'medium' length trades alluded to in such as the CFTR literature. In your opinion, is that enough of a starting point to perhaps suggest some further reading or direction? Aagain, I'd be most grateful of your views.

 

[ChartMan]

Look at it like this, as you come from the Horsey World. Could you make 12 grand a week betting on horses? Could you make 12 grand a week after someone shows you all the tricks and form to do with horse racing? How Much cash would you need to achieve that?
IF you have 100 grand to play with, i.e. RISK, you MIGHT if you were really good, stand a chance of making 12 grand a week. I shudder to think how much capital you would need to make 12 grand a week trading UK end of day. Not that I'm trying to put you off at all.... But if you set your sights on a few hundred pound a mont profit, then it's a different storey. No less difficult though.

 

[bonsai]

if it looks too good to be true ----------- it is.

applies to a lot of claims about seminars, training courses, software black boxes, trading systems etc etc.......

 

[piebald_jack]

Thanks Chartman and bonsai

Of course, you are both so right and put like that, I guess it's as plain as day! Although I don't have a great deal to do with the horsey world in the racing context (though one of mine is an ex-racehorse), I do know how much difficulty others (including the real professionals, ie the training yards) have in sometimes making ends meet let alone making substantial profits.

So, enough said...I take your sentiments with thanks, and hope they have made me a little wiser. Getting a sensible perspective is, as with any new venture, sometimes one of the most difficult things to do when all around you is new and yet full of traps for the unwary!

 

[ChartMan]

OK Lesson one done and dusted! Lesson two. Open a spreadbet account with a couple of hundred quid. Doesn't matter who at this stage. Have a play. See if it leaves a bad taste in your mouth. It'll probably be an eye opening experience that won't cost you your pension. Whilst you're waiting for your account to open, spend every day reading the archives in this BB and you'll be well on the way.

 

[bonsai]

make sure you know why you make a trade.
If that reason proves wrong - get out.

at this stage
you need to build up a series of confidence building trades.
prices do not move in the same direction for very long.

if you have a reasonable profit, never ever let it turn into a loss.
ALWAYS take some money off the table !

if you enter a trade and it turns against you -get out.
the ability to get out cheaply can give you a big confidence boost.
You did the right thing !

In this business, you need to be able to trust yourself to do the right thing !
a lot of people hold on and hold on and it costs them a lot of money.

Record details of all your trades.

 

[al-motor]

pie-bald jack- you are a lucky guy to have come across this board at such an early stage............ Dont rush in it, and as chartman says, just spend the time browsing these boards for a while- I can tell u that it will be time well spent.............

 

[Trader333]

There are a couple of threads on CFTR as attached.


Paul

http://www.trade2win.co.uk/boards/showthread.php?s=&threadid=5170&highlight=cftr

http://www.trade2win.co.uk/boards/showthread.php?s=&threadid=6766&highlight=cftr

 

[piebald_jack]

Again, I'm deeply grateful for the additional replies and the links. And, yes, I really do consider myself lucky to have found this site and such a helpful bunch of obviously sincere people. Please all take a bow — it's not only refreshing but it also restores one's faith in humakind, and hopefully someday I'll be able to return the favours or do the same for others who may follow.

I will take each and every sentiment to heart, just take my time and perhaps 'do my own thing' to see how I feel about the whole experience. However, I may well come back and ask some more questions later (though perhaps not quite so naively) if that's ok?

 

[Skimbleshanks]

Everyone is always welcome to ask questions round here.

However, it is always easier to ask just one or two at a time - those who present a shopping list of questions seem to get fewer responses.

 

[bonsai]

piebald
it's actually the other way round.
it's quite straightforward to offer advice.
most people find the difficult part is following it.

you can thank us by coming back later and telling us you have made good money.

that is thanks enough.

 

[Trader333]

Dr L,

You said:
I never cease to be amazed at the amount of time and effort traders put into ENTRY strategies when even a little experience will tell you that a good EXIT strategy is the key to success over time.

I used to agree with this but in recent times I have been shown to be completely wrong and that Market entry is of critical importance. After all it is the only thing you have control over prior to entering a trade because once in a trade you have no knowledge at all of where the market will take you.

If by exit strategy you mean management of the trade then I can see your point to a degree. I know that Grey1 assesses the risk of each trade prior to entering and by so doing has shown that market entry can be high risk or low risk. If it is not assessed then you are effectively gambling on your entry which in turn will cost you over the long term.

The use of Level II for trading of Nasdaq stocks can also reduce your risk at market entry. The difference between the correct use of level II for deciding when to enter a trade, (compared to not doing), can be the difference between an 8 point loss and 50 point loss if the market moves against you. Because of this I take trade entry very seriously and wouldnt even consider entering a trade without an assessment of risk before doing so. The result is a significant reduction in losses when the market does not prove me to be correct.


Paul

 

[bottomdollar]

When I first got into trading I thought.. "how hard can it be.. it can only go up, down or sideways".. I just need a bit of skill and I'll be ok...

BUT...

as I got more and more into it, I found it was a lot harder than I thought.. the psychology aspects, the entry, exit, position sizing, confidence.. so much to think about....

and there's no room for any mistakes... the markets take you to the cleaners if you don't have your eyes open and a complete utility belt!!

 

[ChartMan]

This entry /exit cuts both ways..... With a good entry, one can afford to relax a bit on the losing trade exit strategy. If you can't get the good entries ( lack of experience etc.) then you MUST have a solid exit strategy for a losing trade.
I suggest an interesting excercise for beginners... ( take care here, 50p a point!) toss a coin for your entry, short or long. Now manage the trade and see how it pans out... If you're trading the DOW, toss the coin after the price has been at 100MA +/- 20 for 10 mins or so.I'd be interested to hear how you get on.

 

[Grey1]

Dr lecter

Quote " I never cease to be amazed at the amount of time and effort traders put into ENTRY strategies when even a little experience will tell you that a good EXIT strategy is the key to success over time.

If your EXIT strategy is good enough you could probably just use a coin toss for your trade ENTRY "

You are totally wrong .. In fact absolutely wrong .. RISK of each trade starts with ENTRY .. Good exit only affects your final return.. it is the bad entry which wipes traders off of the game.. Those who design systems to optimise return are not traders , they are mathematicans who have ltille understanding of trading all together..

I have no doubt that an excellent exit is desirable for faster results but It is simply naive to talk of coin tossing entry and talk about RISK analysis> if you are interested I can send you couple of fantastic EL codes for TS with ultra superb results having EXIT as the optimised parameter with its back tested result which once traded in real time exposes traders to excess risk un tolarable for their trading portfolio..

God knows how many years I have been hearing EXIT is the key and not the entry .. All you get from these guys is the backtested result of a system which does not make trader $$$ and eventually bankrupts them if traded in REAL TIME....


RISK ANLAYSIS of TRADES STARTS WITH CUP OF TEA and SHARP ENTRY

 

[Alfaman]

I have read this thread with much interest having been following a similar path to PJ until fiding this board and , like him, I take my hat off to you guys.

Having found I could not accurately judge the entry/exit (as shown by my declining balance) I started trying a system based on arbitrage. Every day that I watched the Dow it seemed to start with a jump. I therefore went long with one SB company and short with another with stops and limits set so that a jump either way of around 40 points would stop out one trade and the limit would stop the other giving about 20 points per day profit.

It worked a few times then failed more as a slowly fluctuating Dow can stop out both trades but never trigger a profit. You can't paper trade it as you can never quite tell wht the SB companies will do with their prices.

Do any of you experience traders beleive any such system or variant thereof would stand a chance of making regular profits ?

I am restoring a little faith at the moment following Indexking's system - the subject of another thread.

Alfaman

 

[Grey1]

Trader333,

Well said and I totally agree with all you said.. lets put it this way .. if you had a crystal ball which would predict the EXACT ENTRY WOULD ANY ONE EVER LOSE IN THE MARKET.. WOULD HE EVER EXPOSE HIS PORTFOLIO TO ANY RISK WHAT SO EVER EVEN IF HE HAD A TERRIBLE EXIT..

ANSWER IS NO ... SHARP ENTRY= NO RISK

NOW, if the same Guy had similar crystal ball which would predict a perfect EXIT would there be a chance of this guy losing ?

ANSWER IS A BIG YES.. POOR ENTRY and massive drawdowns are the first isue to wipe traders off .

Calculate the risk of entry first and never let greed of optimal exit to ruin your portfolio.. This is what I would say ..