This is EXACTLY why I trade stocks.

I have 5000 possible candidates each and everyday.

It's the equivalent of having 5 tables to choose from or 5000 to choose from what do you think would be a better scenario?

Write a book. Seriously.

I have a friend that wrote a decent trading book.

Mark Douglas

Trading in the Zone.

He hardly made 200k from it first year out and that's dwindled down to 20k since.

There are so many trading books on the market it's not funny and 99% are useless crap.


Reminiscence of a Stock Operator
Trade chart Patterns like the pro's
Technical Analysis of the Financial Markets.

These are the only 3 of the hundreds that I've read that where worth keeping.

Thanks for the insight. Today should provide plenty of volatility

i was thinking about learning day trading and was wondering whats ur lifestyle like.like how many hours do u work/study.im not rly interested in working like 40-50 hour weeks + studying.sry if this post is dumb but im a complete noob plse excuse my ignorance.also i realize that u cant just jump into it right away i plan on studyin for a couple of yrs or longer if need be until i feel i understand it well enough.

When I first thought about trading stocks, I found this number pretty overwhelming. Now small starting traders run into the PDT Rule. If you want to day trade stocks you either need $25K plus enough to weather any early losses on top of that, or you have to join a prop firm.

Can anybody explain the logic behind the PDT rules? I thought that it was in place to protect the investor but how does forcing him to put more money in his account and forcing him to have instant access to an extra 25k that he may not even have do that? Maybe I'm biased because of poker but a ton of degens can run a few k into 25k and these aren't the type of people you would ever want to loan money to.

The reasoning is that if you have at least 25K you can afford to lose it. I don't understand your question about loans unless you are unaware of individual brokerage requirements in order to establish both margin and to utilize risky trading strategies.

I signed up for a margin account on Scottrade and got 25k of margin on an account with a 25k deposit. I make less than 25k a year and though I have no red flags on my credit history I don't have alot of history to begin with. I was under the impression that they give 100% margin to pretty much anybody. I expecting to get 100% and I did it more to be able to day trade then the desire to have access to margin.

EDIT: I understand that if I went and did something crazy like buy 50k of GM I would get margined called pretty quick and liquidated if I didn't respond but still seems like an overall odd way to protect me.

This thread should actually be in the sticky imo.

i dont really buy this entire thread....

not trying to be a dick, but a few questions:

1) if you made this much $$ as easily (no real downswings recently, and u been at it 25 years...) why are u still working?

2) why are u playing microstakes still? seems like if u were really making this much ez coin, the logical thing to do would be to step up from 1/2 NL to 2/4 NL. seems like u are single and have a lot in the bank and are super confident in your strategy, but you only risk 25k of ur own ?? dont buy it.

3) i am a vol trader, and the thing that always bugs me is that ppl assume vol traders are printing cash right now. vol traders mean that we make bets on volatility (but sometimes we bet on it not being as volatile). anyway, your strategy of doing things with very tight stop losses would probably have done pretty well from day after TARP 1 to 750 SPX, but u probably got torn the f up since then.

anyhow i find your posts to be extremely vague (although u are probably being intentional) and misleading. this game isnt that easy and a lot of the smartest ppl in the world playing it right now are blowing up. maybe some people really can print money daytrading noise, i guess i am just skeptical....

November was an absolute brutal month for anyone long vol especially given that people made a killing in September and October.

Question to WSP or anyone in this thread for the most part.

What would you consider the average contract commission rate to be for an established options trader trading at least 15k contracts a month.

Speaking of trading books, what do you think of Wyckoff and Mamis books?

Many of the smartest ppl invested with Madoff. Dumb ppl weren't allowed to buy into his fund.

To assume you have to be smart to get into a hedge fund is ludicrous.

Yes it is A typical of what happens when the Government try's to protect people with insane legislation.

It originally came about back in the 90's boom when a disgruntled day trader took a gun and shot like 7 people in a day trading house.

So the government thought that only people who have 25 k or more to lose would be of higher intellect:and not shoot people.

But I don't have to tell you guys how friggin STUPID the government is when it comes to this kind of stuff do I.

Trading is no different then any other serious CAREER that pays 500k to a million a year for the best in the field.

It should be approached with the right commitment and state of mind.

It takes 10 years to really make serious coin as a doctor and trading is not that different.

Of course some do much better sooner but you get the idea.

1. I make on average 400k per year that's hardly retire forever money and I've only made this kind of money in the last 10 years (the first 15 where variable for multiple reasons). I am also single and enjoy a rather expensive lifestyle and to be honest I do waste a lot of money on silly things.

2. I would like to play higher stakes but A. It's not readily available in my area and I'm just starting to take poker seriously in the last 8 months.

and B. To be honest I am just barely beating 5/5 right now and when I did take a shot at 5 /10 I sucked out bad and went negative.

I see no point in playing 5 /10 and higher till I can beat 5 / 5 just because I have the money, do you?

I'm only playing 4-5 hours in the evenings / weekends now once I log more hours I will take a shot at some higher stakes again trust me.

3. Well no offense but of course I'm being vague about the specifics of how I trade ... lol

I titled this thread Ask my anything about day trading not Ask me anything about how I make money each day from day trading.

you have a right to be skeptical it's your prerogative.

If you have a specific question about trading then go ahead and ask it but I will not lay out a total game plan for you and I'm sure you can understand that.

15,000 contracts per month is pretty sizable.

There are prop firms that specialize with options traders but I'm sorry I don't have any specific recommendations for you.

Call through the list and ask them if they take options traders.

when i said higher stakes, i meant in the market. you are playing pretty small stakes (risking very little...). Seems like with all the success you've had, why not make bigger bets?

I find it hard to believe someone without using math or computer programming is able to average $400K a year for 10 years through day trading. It may be true but it just doesn't ring true to me.

Everything I have read about "discretionary traders" seems to point to the fact they use some sort of Martingale system - increasing bet size after loses. With $1 million of purchasing power you could consistantly make $1000 a day for many years, even making -EV trades, until losing all the profits plus more.

I personally think your off base a bit here. Discretionary trading with proper entries and exits, stop losses, and bank roll management is no different then creating a system on the fly.

What your talking about is traders who take on way to much risk and don't exit losing trades when need be. Its pretty hard to lose everything and then some when your only risking 3% of your bank roll on each trade and limiting your losses to 20% on that 3%. (just throwing some numbers around here)

$1M in purchasing power is a bad way to look at. If I have 50k and someone gave me 20:1 leverage then id be in trouble. If I actually have $1M to trade with keeping no leverage then making $1000 a day would be pretty easy with little risk of going busto.

That said I am also a bit skeptical that wallstreet pro is averaging 400k /yr with only 25k trading account.

I like to think if I made $400K a year for 10 years I'd be pretty set.

http://www.travismorien.com/FAQ/thrift/millionaire.htm

"Multiply your age by your gross annual income from all sources except inheritances. Divide this by ten. This, less any inherited wealth is what your net worth (excluding home equity) should be.
The authors went on to classify two extremes of wealth accumulator
A prodigious accumulator of wealth (called a PAW throughout the book) has a net worth twice as high as this formula.
An under accumulator of wealth (UAW) has a net worth under half of this.
In between is the AAW (average accumulator of wealth), which is your ordinary garden variety rich guy."

Where would you say you fall?

I guess I believe it is extremely hard to almost impossible for a discretionary day trader to make positive expectation bets, once you consider transaction costs (spread, commissions, taxes). Bankroll management, including stop losses and trade sizing, is irrelevant if you are not making positive EV trades in the first place. And if it is possible to make positive EV trades, almost certainly the market will correct its inefficiencies. So you're going to have to come up with new ideas for exploiting market inefficincies as old ones play out.