Trader Q&A's

[sifts2win]

Wt,
So if u were the man doing the training and selecting u must have been one of those great floor traders once yourself. With all that experience, and whilst I know what you are saying, in the context of the thread, wouldn't a more constructive response have been more in order.
We could all learn so much from someone like you, so how about it ?

 

[Helenqu]

Hi Mike,

Yes you simply cannot spreadbet the type of index trades I do and that is what I am suited for by nature and pocket It took me a year to of spreadbetting to find that out but it was cheap learning. Pivots are wonderful, the STOXX sticks to them almost like glue. What I need to do is gain confidence to trade what I expect to happen. I'm too cautious at the moment.

Cheers

 

[sifts2win]

Helen,
based on yesterday's action (a biggy I accept) it looks like trading a simple 15 min chart with a 13 period bollinger and using the ma as support /resist coupled with your pivots (which were smashed on the ride down !) could have made a v. nice profit using sb's with nice wide stops.

It also looks like the index trends nicely too for simple trend line breaks. I'm only using delayed charts from futuresource but still interesting enough to work out a plan. Hmmmmmm.
Looks like base forming this am.

Great stuff !

 

[hjk]

Whitetiger
When you say 'floor traders' I presume you mean the traders on the LIFFE (maybe IPE/metals) exchange?
Whilst I would agree that there it was often literally eyeball-to-eyeball, the white-heat of the markets in its purest most naked form etc, where aggression and even a strong (large) physical presence was often required, I believe that it is of no use when screen trading which we all are now.
I know plenty of very successful ex-locals who have really struggled/given up since the switch from floor to screen trading, or they've investigated going to CBOT.
The screen is obviously one-removed from the face-to-face LIFFE floor type trading, so the locals who had honed their skills to recognise weakness in the positions of others (because he was only a few inches away) and could use their aggression to exploit it, suddenly found that this edge they had developed was unapplicable and of zero use when screen trading.
99% of locals were against the switch to screen trading because they knew that the market would become a lot more 'open/transparent' and their short term edge would disappear.
In short i think the type of skills that made a great floor trader are not the same ones that make a great screen trader.
What's the point of getting aggressive to a screen?

 

[hjk]

Helen
That's fine!
Just when I think of 'job' I think of something that provides one's major/only source of income to live on. Not that you can't enjoy your job. Not having to draw an income from your trading profits is a great luxury and a fortunate position to be in, but for me that would classify it as a 'serious hobby'.
But i am really splitting hairs here, the main thing is that you know your goals and you have a realistic chance of attaining them.
Good luck!

 

[options]

Have a few days off to sort out computers and this thread gets really interesting.

Sifts: Very brave of you to bare your soul like that. It will all go to make you a better trader. But only using the sb's?
Surprised you lasted as long as you did.

Helen; Keep going the same way and enjoy it. A bit here...a bit there... All mounts up. When you feel comfortable, double up on the trade. On the first loss. Drop back to single trades for a while then try again. HJK is right about the jump. Though we are going to have to agree to disagree on the 1,000 to 2,000 versus the 10 to 20,000. I still maintain the former was the harder, but it comes down to a confidence thing for me.

And welcome to the site HJK. Nice to have another liffe futures trader aboard. You've been doing this for longer than I have, so you will probably be able to give me a few tips. The day I stop learning is the day I die.

A very profitable trader, who turned out to be my mentor and into a good friend along the way, once told me. "The only dreams worth having are those which are attainable."

Good Fortune.

Options.

 

[hjk]

Options -
thanks for the welcome.
"The only dreams worth having are those which are attainable." ? I believe I already wrote something very similar further up this thread - addressing FTSE-B.

I would still like to know your rationale behind your belief that doubling 10k is easier than doubling 1k. This is about theoretically 'doubling your money', which is not a goal that I think anyone should start the year with. As i also wrote before-hand, if you really want to trade full-time with your profits as your one and only source of income, then ideally you need 100k minimum

 

[sifts2win]

Hi Options,

Have learned to adapt to trading with sb's out of necessity and I suppose there is some success in just surviving all this time. At least I've learned a lot about pure price action but it has affected my confidence in using indicators.

Helen mentioned her jump to futures and I've always thought the risk was so great that I needed to demonstrate almost godlike qualities in my trading b4 going there.

I get the impression that most of you trade futures and with Mytrack/Sierra one doesn't seem to need a huge payroll to get going.

Are u suggesting there could be better alternatives ?

Have a good w/e everyone.

 

[Helenqu]

Helen mentioned her jump to futures and I've always thought the risk was so great that I needed to demonstrate almost godlike qualities in my trading b4 going there.

FWIW I think that apart from the financial aspects of trading say DAX or S&P (which I wouldn't be ready for) futures are 100% easier than Spreadbetting for short term traders. You can actually trade what you see, such a luxury And you can control your risks properly, you just can't do that with SBs on a short time frame.

I saw it is a big jump, futures were for the big boys, not for the likes of me but I was ready. (Says she after her first losing week in five weeks But only down 10 points).

 

[neil]

Tax Question

If one starts trading with a sum of money, say X. And makes a profit, say P, by churning the original stake (X); when am I liable for tax:

Is liability immediate upon making a profit above original stake whether or not the profit element is removed from one's trading account?

or

Tax is only due when profit element (P) is removed from trading account?

 

[Morris]

As I understand it, you simply calculate your total profits in the tax year. Then allow for the CGT limit, and any gains above this level are taxable.

 

[orchard]

What an excellent board. One says black the other white - and they're both right!!!. I am newish to trading (spread betting) and my major aim at the moment is just to keep in.
At the moment I am testing a system (I know, I know!!!) but it is interesting. I keep meticulous records, and when I have enough I will look at them to see if it is worth following. At the moment. after 4 weeks I am in profit on points - but 4 weeks is a long way from an annual income.
I have traded small real trades, not too successfully yet, trying to hang on to my capital, but learning anvaluable lessons. Reading the contributions from 'real' traders is wonderful, if sometimes confusing!! (see above).
I am hoping to go full time soon and praying that this practice will pay off.
Good luck to us all.

 

[neil]

Tax

Thankyou Morris

 

[sifts2win]

Hi Helen,

What is the problem with trading Dax or the E mini S&P ? Is your exposure much higher than Eurostoxx or something. Also what actual instrument do you trade ?
Will I really find it easier than sb's ?

Regards

 

[Mr. Charts]

FTSE-B,
Very well done with your trading record.
I have been trading almost full time since 1999 and support my wife and three kids on my profits.
My only other income is a sideline of coaching other traders a couple of times a month.
I completely agree with your statement that you should be able to make £500 per week on £10000 capital. That equates to 20% profit per month. Personally my worst month was a return of only 14%. If I said what my best month was, no-one would believe me ;-)
It’s surprising how many people don’t believe that until they can do it themselves. However, I know many other traders who regularly achieve that sort of return and for you to emulate that figure so quickly is excellent. Good for you ;-)
I am talking here about generating income and putting some extra profits away. If I would have had as much as £100k to trade with I would have been able to accumulate substantial capital, though the fills possible on trades of several thousand shares would have produced slippage and a poorer return.
I do trade emini futures, but mainly US shares.
As far as the comments about a larger capital base , this is what I advise the people I coach:
Paper trade for one week only, then
trade 100 shares until you consistently make a minimum of $50 profit a day, then
200 shares till you reach a consistent $100 profit, then
300 shares till $150 and so on.
I tend to trade 1000 shares if they are in the $20 to $50 range, fewer above $50, more below $20
This approach allows self confidence to be built upon experience and trading success.
It’s not wise to start talking about unending compounding of profits, the real world doesn’t work like that. What is achievable is an excellent living and tucking some money away to diversify into property etc.
FTSE-B, to have done so well so quickly is excellent. Keep to the same winning methodologies and you’ll achieve your dream ;-) Why not, others do!
I can only speak from experience, but you do not need to start with £100k. No way.
Hope this helps.

 

[Helenqu]

Hi Helen,

What is the problem with trading Dax or the E mini S&P ? Is your exposure much higher than Eurostoxx or something. Also what actual instrument do you trade ?
Will I really find it easier than sb's ?

Regards

Its the cost of a point, Dax is 25E a point for example whereas EuroSTOXX50 which is the index I trade is 10E a point, theres a big difference. Also as EStoxx is around 2500 the moves are not as wild as something like the Dow.

If you follow this link you'll see my logic in chosing EStoxx.

http://www.theblindsquirrel.com/forum/topic.asp?TOPIC_ID=524

As to easier, if you trade on a short timeframe yes, spread of 1 point and transparency, what you see on the chart is what you trade. Costs are 4E per round trip.

HTH

 

[Morris]

Helen, do you get depth of market info on the Eurostoxx ?

 

[Helenqu]

Hi Morris,

You can but I don't.

 

[Crazy Guy]

Great Thread! Thanks.

 

[FTSE Beater]

Hi Mr Charts

Paper trade for one week only, then
trade 100 shares until you consistently make a minimum of $50 profit a day, then
200 shares till you reach a consistent $100 profit, then
300 shares till $150 and so on.

Thank you so much for posting this up. I think it's excellant and that's how I will increase my size in the future (and I've just added a note on my trading accounts so I won't forget )

Thanks again