Is industry experience a must before attempting day trading from home

[Mufasa]

Hello I would love you opinion,

I am trying to become a successful day trader from home, but is this at all possible seeming as I have never had a job in the industry?

My only training is from seminars, courses, many books and various online tutorials. I graduated last year and have been applying for jobs in the city with no luck. In the mean time I decided to build my own experience for a year or two from home with the aim of getting into the industry eventually. I trade the e-mini S&P 500 futures.

How much of a disadvantage am I at not being professional trained?

Many thanks

 

[luckyd1976]

Hello I would love you opinion,

I am trying to become a successful day trader from home, but is this at all possible seeming as I have never had a job in the industry?

Yes very possible

My only training is from seminars, courses, many books and various online tutorials. I graduated last year and have been applying for jobs in the city with no luck. In the mean time I decided to build my own experience for a year or two from home with the aim of getting into the industry eventually. I trade the e-mini S&P 500 futures.How much of a disadvantage am I at not being professional trained?

Many thanks

In trading stirking out on your own is absolutely the best way. Very few people have the Pedigree to go straight to the big time shops and trade. As far as Professionally trained, thats hit or miss now adays with shops disguising training fees as startup caital and the qualities are so scattered all over the map on the level of training you'll likely get.

Track record speaks volumes. Keep it up and dont worry bout the % 'tages they will take care of themselves. PM if you want to bounce ideas around.

 

[Pento]

Trading from home and becoming successful is indeed within every newbies reach. Just takes hard work and discipline from the start.

But it is very very lonely and a steep learning curve to take on your own. You said you've had some training so it depends on how much of the basics you've been taught. There are obvious benefits of being in an office. You get hands on training from senior and experienced people trading the same products as you, plus you can chat to other traders throughout the day about trading or other important stuff like Miss Lopez's behind.

Don't need any trading experience to become profitable from home. However, I would imagine it will take you longer to develop a profitable strategy on your own. And on the flipside, it's cheaper from home compared to an office which means if you have say £10,000 as a trading capital budget it will last you longer from home than at an office.

I haven't given you a conclusive answer it looks like!

 

[William Waller]

How much of a disadvantage am I at not being professional trained?

Many thanks

None whatsoever.

 

[spy74]

i agree...none what so ever. FYG, I'm not yet what i would call an experienced or successful trader as yet, but I have learned alot and starting to build some consistency.

I think it is alot harder work and will take more time because you don't have access to mentors and colleagues etc, but I think it can also be more rewarding because its your own work and your own strategy that you will end up trading.

I think lucky is right - track record speaks for itself. there are plenty of guys sitting in IB's and hedge-funds who know how to lose alot of money and mis-manage risk...the last few years have shown us that!

 

[Mufasa]

Firstly thank you to all of you who responded and all of it so positive, I was expecting or perhaps fearing a little worse maybe that will come lol.

Luckyd76 by track record do you mean keep a trading journal or just building consistency?

Pento you did answer it, It was nice pointing out both sides of the argument thats what I need

Ive kinda found a strategy but needs more testing or more like I need more testing using it, working on the discipline, the hard work you guys refer to, does this mean keep at it with learning what you can and watching/participating in the market etc. or something else?
:smart:

 

[luckyd1976]

Luckyd76 by track record do you mean keep a trading journal or just building consistency?

Track record to me is a live trading account.

And if you are not ready for that You must DEMO trade somewhere.

Online Journaling is ok to work on some new strategies. And usually people will give you some much needed uh um criticism if they think it sucks.

But without the monthly Statements(either demo or live) showing your TR you just got to keep on pluggin away. Keep any and all paperwork. I knew a DEMO trader that practiced for 1 yr, All demo, but printed out his Monthly statement balances and showed x% Amount monthly returns and got a job on an incubator trial basis.

You're right TR should show some consistency.

Keep track of
Win Rate %
Average Wins $
Average Loss $

Ive kinda found a strategy but needs more testing or more like I need more testing using it, working on the discipline, the hard work you guys refer to, does this mean keep at it with learning what you can and watching/participating in the market etc. or something else?
:smart:

Even discretionary traders need it drilled in so much that mentally it feels like a Mechanical strategy.

*If this happens I do this and if that happens I do that.*

The more the drilling the easier it is to overcome the Psych of trading. Demo if you can on the platform you choose to use. If they dont have one, Demo anywhere in the market you plan on trading.

 

[scubatim84]

Hey guys...new user over here and I actually had basically the same question as the OP. Recently, me and my fiancee decided to purchase 225 shares of Tesla Motors (and before you say it..), which we're aware has a long way to go before being profitable, but we believe the company will be another success story like Amazon was...rough start but smooth sailing afterwards.

Long story short, I got my first taste of day trading today by selling our Tesla shares. The reason being is not because of a loss of faith, but because it seems over the past day or two a microbubble has been developing (and may turn out to be a full on bubble like the 3 day one after the IPO happened) so I decided to sell the shares with the intent to repurchase them later at a lower price. I believe the price will come back down simply because I'm a strong believer of fundamentals and there's no way a negative EPS translates into any value higher than 0 as far as I'm concerned.

Anyway, I made $235 today with 1 trade and it got me thinking...is it possible to consistently average gains over the timespan of a year that's equivalent to a reasonable salary? I've had a hell of a time finding a job (100+ applications so far, 0 offers) and I figure there's more than one way to put my economics degree to work.

 

[luckyd1976]

is it possible to consistently average gains over the timespan of a year that's equivalent to a reasonable salary?

Yes. 260 Business days (plus or minus a few holidays) in a yr. LOL or 12 months in a yr. Have fun figuring out how much of a salary you would like to draw.

Yes Possible but NO NOT easy. There's a reason why 95% of traders fail. Steep learning curve. And the pressures of drawing a salary on a daily basis from the markets right off the bat first thing are hard to do. It takes practice, time, and most importantly money to make money from the markets.

If you are looking for income
Emini's are for Income (ShortTerm)
Options are for income (MidTerm)
Dividends are for Income (LongTerm)

Master anyone of the ST/MidT strategies and you'll be fine.

 

[Mufasa]

Thanks again Luckyd76, ive been through the demo/sim phase, many many months, become consistent and confident, so I took the plunge and it was completely different somehow with real money, things changed, obviously must be psychological, but im slowly chipping away at it to make it becomes normal and familiar.

Thanks for the tips, become a robot, know your market, know you strategy, track your progress, learn from it. The sports psychology article on the homepage is very good.

 

[Xenophobia]

Who needs qualifications to know when to buy/sell in the market. Its common sense Disguised as technical analysis.

Why is it called technical...well to justify large salaries for analysts who have degrees and all sorts of pointless ****.

Fact of the matter there is nothing technical about it. Its childs play bummed up to be something its NOT.

 

[Mufasa]

Would working in the industry help you collect some sought of insight as to the habits of institute trading?

Im constantly hearing/reading about the big players, the whole amateurs v professionals.

They say the big boys always have one upon the rest of the market, driving it to suit their needs, what level of awareness do I need to develop if any so not to get trampled by thier orders?

All im aware of at the mo is they will push through support/resistance lines a tiny bit to generate a different bias so they can offload or create buyers, trigger stops etc. And that they often will make the market appear in a new level eg. pushing price high creating momentum buying but only so they can start a huge sell at a high price.

Hope it makes sense and someone can help

 

[scubatim84]

Would working in the industry help you collect some sought of insight as to the habits of institute trading?

Im constantly hearing/reading about the big players, the whole amateurs v professionals.

They say the big boys always have one upon the rest of the market, driving it to suit their needs, what level of awareness do I need to develop if any so not to get trampled by thier orders?

All im aware of at the mo is they will push through support/resistance lines a tiny bit to generate a different bias so they can offload or create buyers, trigger stops etc. And that they often will make the market appear in a new level eg. pushing price high creating momentum buying but only so they can start a huge sell at a high price.

Hope it makes sense and someone can help

Well, I'm pretty new myself but my observations so far from researching technical analysis a lot and looking at charts of different stocks today did show some indicators of whether a push through a support/resistance line is there to stay or whether it will retreat back or not. I used an EMA 5-period overlapped with an EMA 20-period, and when I saw very small pushes through a support or resistance line, I cross referenced it with a MACD using a 5 period for the short one and 20 period for the long (9 period for smoothing), and saw that the MACD doesn't always "agree" with the push if it's not there to stay because the short period will remain above the long period which still may signify an uptrend, albeit a stalled one. I also noticed a 10-period RSI may offer a clue as to whether the push is legit or not, because if the shares are currently in overbought territory above a reading of 70, if they start plummeting towards the cutoff and/or past it, seems pretty obvious versus if the RSI is moving relatively sideways (or the MACD) for that matter, more often than not the push doesn't last.

Of course, this is just what I've observed today amidst my research and I don't claim any of it to be correct. In fact, I'd love to hear some more experienced users' opinions on my analysis.

 

[dsb104]

Not a must, but I would say a secondary income is desirable, so you can just focus on trading without financial pressures, like bills to pay.

 

[4xpipcounter]

Mufasa, you have nothing to fear. A knowledge of the industry is not necessary. Understanding how the banks operate and fluctuate price is not important. What is important is having a trading methodology that you embrace and have the supreme confidence in. Also with regards to doing it FT, make sure your initial deposit is large enough with respect to the % of gains that you get on a normal basis relative to how much money you want to make during any interim period.
I also reccomend to have a backup, such as enough money in your personal account to cover yourself in case you have a bad week, month, etc. This way there is no pressure on you in case that rarity happens.
I can also tell you from personal experience I have never taken a class and still don't get to wrapped up with what the industry is doing. My concern is always, "What do my charts say?" If it signals a buy on a particular currency I buy it. As an example, I closed a beautiful short on the USD/CHF. There was a lot of hype about what the Swiss banks were doing. That's something I could have cared less about.
The point is make sure you have a soundly developed methodology, you have a backup plan, and then you are all set.

Firstly thank you to all of you who responded and all of it so positive, I was expecting or perhaps fearing a little worse maybe that will come lol.

Luckyd76 by track record do you mean keep a trading journal or just building consistency?

Pento you did answer it, It was nice pointing out both sides of the argument thats what I need

Ive kinda found a strategy but needs more testing or more like I need more testing using it, working on the discipline, the hard work you guys refer to, does this mean keep at it with learning what you can and watching/participating in the market etc. or something else?
:smart:

 

[Mufasa]

4xpipcounter - thanks for you post, in a word inspiring.

Tell me, how long did it take for you to find your trading strategy/system, to find the one that works best for you?

That can be an open question to anyone really.

 

[4xpipcounter]

I started in July 2004. By May 2005, things were rounding in place. I was starting to win on a regular basis, but there were still things that needed to be worked out-- things like managing the mental side of me in a better way, proper margin management, forcing myself to never veer from the successful path.
Keeping an open mind to waht others had to say has helped me immensely. In 2007, the totality of my methodology was reached, but not in anything that would appear to be obvious. I was talking to someone that was a general loser in trading, and was always desperately looking for that one thing that would turn his trading and life around. We were having a discussion about trend's dynamics, the trend's range. My mind go to running off in a tangent, and thus I came up with a proprietary set of S&R's that takes into consideration all of what I mentioned, and is predetermined before the TF, not after or during. Usually, someone would not want to take time for a loser, but as we talked my mind went to work, and I assimilated many of the ideas he brought up. He is a very nice guy, which helped in having and maintaining a dialogue with him.
The other part of my methodlogy came together in 2007 in an even less than obvious way. I had a trading room at the time, where we had close to 100 members. This guy was talking to me about the ichimoku cloud, of what I was never interested in. I told him that it sounds good, and that he may feel free to post any comments and ideas concerning it in my trading room. Our trading room was not a vacuum, but it, too, was open to new ideas. Our room, during its existence examined over 500 different indiactors together. Most of the poeple in our room were already successful, but we were open to learning more.
This guy shared his ideas, and even posted some of his trades. He uses the ichimoku as a standalone indicator. He got my curiosity up. We got together, privately. For 3-4 months, I was in ichimoku school, while demo trading the setups I saw. This led me to cancelling my subscription to the only paid indiactor that is worth its money, which is the TRM bands from Forex TRM.
That is only meant as a prop for Forex TRM. I make no money for endorsing them. My endorsement can also be seen on their site. I don't want to sound like a solicitor, so if you want more information concerning it, PM me and then we can exchange e-mails or just PM.

4xpipcounter - thanks for you post, in a word inspiring.

Tell me, how long did it take for you to find your trading strategy/system, to find the one that works best for you?

That can be an open question to anyone really.

 

[kingfisher3210]

Hey guys...new user over here and I actually had basically the same question as the OP. Recently, me and my fiancee decided to purchase 225 shares of Tesla Motors (and before you say it..), which we're aware has a long way to go before being profitable, but we believe the company will be another success story like Amazon was...rough start but smooth sailing afterwards.

Long story short, I got my first taste of day trading today by selling our Tesla shares. The reason being is not because of a loss of faith, but because it seems over the past day or two a microbubble has been developing (and may turn out to be a full on bubble like the 3 day one after the IPO happened) so I decided to sell the shares with the intent to repurchase them later at a lower price. I believe the price will come back down simply because I'm a strong believer of fundamentals and there's no way a negative EPS translates into any value higher than 0 as far as I'm concerned.

Anyway, I made $235 today with 1 trade and it got me thinking...is it possible to consistently average gains over the timespan of a year that's equivalent to a reasonable salary? I've had a hell of a time finding a job (100+ applications so far, 0 offers) and I figure there's more than one way to put my economics degree to work.

Allright. This strategy works when market is in long term up trend and you sell high and buy low. You are doing a cash transaction as you had purchased shares and selling them.

Now you are expecting TESLA will come down and you will buy it and then again you will sell it at higher price. You again buy at lower price and then you again sell it at higher price...like this.

As i said this strategy will work if TESLA is in long term uptrend. It will get to $ 19, then back to $ 17.50, then new and more buyers will step in at $ 17.50 and it will hit 21. Then back to $ 19 and then back to $ 23 and then back to $ 21...like this..an example.

Just like Dow has done since March 9, 2009 after hitting the bottom of this current rally.

This strategy does not work when a share or an index is in downtrend. For example: You sold Tesla at $ 19, then buy at back at $ 17, and then it goes back to $ 15, then to $ 16 and then to $ 14, then to $ 15 and then to $ 13.

Now you are left with unabsorbed losses. At that point of time, you mind will tell you at least if it comes back to $ 17, my purchase price i will exit making money for my broker.

Heres my experience that may help you-

1) Get a full time job. Keep searching. Move out of your state. But start a full time career somewhere. I see you have an economics degree, that will help you in doing left side brain analysis in markets.

2) Now the real money is to trade future market. Future traders have got an ability to make money in an uptrend as well as downtrend. They go long, they go short- They have got an option to do so unlike buy and hold investors.

3) To trade S&P futures and make money and later on make living out of it is equivalent to making of a doctor or an engineer or any other professional like an economist. You need to put hours and hours, trying to find out a system, get the brain trained in all aspects, do atleast 6 months of demo before putting first live trade.

4) All this you can do and should do with your job and on weekends. The first stage is learning, adapting, making journals, finding out a system (discretion or system trader) and this can be done with job.

5) My point is you will not like to sit at home for 2-3 years, spend the time in frustration (inti tally finding out a trading system is a frustration), so you should work full time and all the best for your job search.

6) Do not give up. Trading S&P futures successfully should be your dream and if you do not give up, i am sure you will find a way to do it. How ever it takes time just like doctor spends few years in learning and practice.

 

[4xpipcounter]

If you have to ask that question, then the answer is "no". Let me explain.
In order to trade, it takes a fully developed methodology that you have the utmost in confidence in. When that is the case, you are not even asking that question, because you know you are good, and you know you have what it takes.
Now, let's do the flip side. Being unemployed could be a blessing in disquise to you. I hope the case is you have spare time on your hands. You can use that time to work and fully develop your trading plan to your benefit. Demo trade. If you can maintain consistent gains after 6 months, then you might be ready.
Key word--"might"-- Once you trade live, then the mental part enters. You have no real money at stake on your demo account. Many times people change their habits when they are going live. That would be one obstacle.
The second part is do you have enough capital to start where your percentage of gains would make a sustainable living for you and your family.
Thirdly, do you have enough backup capital. After all you will have bad weeks or even months. You cannot have stress in trading. There is no greater stress than worrying baout the bills getting paid while you trade.
To summarize, right now it would seem the answer would have to be "no". In the future, if you answered no to any of the three parts described, then you still won't be in the future. Don't forget, you are entering the ring with lions. 90% of everyone that opens a trading account bankrupts it. There is a reason for that.


"Anyway, I made $235 today with 1 trade and it got me thinking...is it possible to consistently average gains over the timespan of a year that's equivalent to a reasonable salary?"

 

[amit1986]

The age-old question of how long it took to become profitable. There are several threads devoted to this question entirely. Most people will give you an approximate figure, while others try to sound like a textbook.

Fact of the matter is, it takes as long as it takes. It definitely won't happen overnight; nor will it happen in the first month. Chances are it won't happen in the first six months either.

However, depending on how disciplined you are and how hungry you are to learn, it can happen within six months to about an year. However, this happens to only some. Others spend years before it clicks.

Instead of pondering over this question, I suggest you re-shift your focus on trying to learn as much as possible. At one point, it will just click and you won't look back.

Amit

4xpipcounter - thanks for you post, in a word inspiring.

Tell me, how long did it take for you to find your trading strategy/system, to find the one that works best for you?

That can be an open question to anyone really.