ok so I'm complete noob with this stuff and I know that questions like this get shunned by a lot of the reg posters in this section but please avoid trying to be rude or anything but also be realistic. So I have no experience with investing/trading other than reading the book "understanding wall street 4th edition". I have a friend who does day trading and he told me that I would need to study a lot and have at least a 10k bankroll to start with. I have no intention of trying it out for a while anyway but I was wondering if its worth studying.

I'm currently 20 and I think I'm generally a fast learner, I started playing poker about a year ago and I'm now making decent money (to my standards) from playing 50nl (with a pretty solid sample) and plan on moving to 100 soon. I dont want to come off as thinking highly of myself or anything I just mentioned that because I was told that poker and trading have a lot in common. I love the risk/reward factor and would be willing to put in a lot of study time and obviously I'd treat it as a hobby at first and not take on big risk or anything.

My question is directed at people who actually make decent money in this field. In your opinion is it worth studying at all or is it a dying market that is best left alone by beginners?

Something like 90% of fund managers don't even beat the market in the long run. Thus, the vast majority of people (most likely yourself) are better off investing in low fee index funds (such as vangaurd) that cover the entire global market. Read up on John boggles investing strategy and pretty much just buy and hold. You said you are 20. If live below your means now and invest your savings you can likely retire in 20-30 years.

The equity markets are an everchanging dynamic.
Some of the most successful have had to reinvent themselves on more than 1 occasion; while fine-tuning their current craft to stay ahead of the curve so to speak.
Im saying that because, while there is opportunity, there will always be an edge, no matter how small.
While poker and trading are similar, I think its extremely difficult to read a lesson on TA, start grinding your investment on a daily basis, and be profitable.
Try to find a desk, or environment, where you can be around seasoned pros, and just absorb.
Then you can gravitate to a style or system that fits your tolerances best. Whether it be the buy or the sell side of the business.

In my opinion it's not a dying market. The only people who really have that opinion are those who were brought into trading with a structural edge or were clinging to some sort of a gimmicky strategy. Obviously the guys who were making markets in the pit, or on the screen pre Reg nms, are going to think that. Back in their day, trading was super easy so it makes sense that they would think trading is dead, but that doesn't mean there aren't good opportunities today.

of course is worth studying this subject, it's an important addon to your knlowledge and i think everybody should study that in their life, "rich daddy poor daddy" provides a nice outlook about this argument (there are other things that i don't like about the book, but ... just for have a smatter it's ok).

if you ask me, if it's better to start daytrading instead of playing poker?
i think you need a lot more roll in daytrading, you start playing against nosebleed reg even if you play nl2, it's really really hard, you need a huge roll or a perfect moneymanagment to make a ton of money daytrading...

so, if you study trading with the hope of make easy money, forget that, but it can be very useful knowing the dynamics of economics and finance.

actually i have a 70% roa w poker, w trading using the same size i'd have something like 2% roa... so, the smaller the roll, the better is poker...
above 1m$ trading >>>> poker
above 500k$ roll trading > poker
under 250k$ poker > trading

If you consider it generational, I think it would be better to directly invest. You can beat the vanguard index by eliminating the highest market cap stock which generally underperforms. Also a dividend fund, not right now, should beat the market. Also, there are some closed end funds you can get at a discount. Furthermore, there are sites like insidermonkey and many more that with about 10 years experience behind you can beat the market without a manager. However, you can also try to find a better index. There are many vanguard indexes, which one? The new investor often makes the mistake by picking the index with the highest recent returns, like an oil index or a gold index. So even a novice has to pick an index. Somewhere I compared indexes which had the best 20 year performance, they were not bad but compared to a fundamentally based indexes they underperformed the last 5 years. Also additions and deletions to indexes can be exploited by professionals thus even though the fees are low the fund is forced to buy and sell certain stocks and the index suffers as result. I think it would be better to find a fund with its own index or methodology to avoid the exploitation. Sometimes even money managers change or it turns out the got lucky. Look at the CGM focus fund over the last 5 years it has underperformed the market by 9%, yet over 15 years it still overperforms by about 10%. Generally with a little study, you can beat the market using even index funds by 1% which over 30 years you will have twice the amount of money. Generally stocks rise and fall with the market so I try to sell on up days and buy on down days I think it may add 1% to my returns long term.

My question is directed at people who actually make decent money in this field. In your opinion is it worth studying at all or is it a dying market that is best left alone by beginners? The bigger question is time. Like politics when you get in you end up spinning a your wheels and give you more stress than you will ever gain but it may also make you a more complete person. you can easily spend 1 hour a day thinking about the markets, that is 10% of your life. The biggest gains can be made by avoiding the dying market and cash is the market too. So by putting money in the bank, you are also making an investment decision. One investment decision is spending all your money and living paycheck to paycheck with debt, on Obamacare, no insurance, and skipping out when the debts are due.

correction: The biggest gains sentence I don't know where that came or what it means. At times the biggest gains might come from gold, real estate, cash, oil, things move in and out sort of like the way stars in the Milky Way drift around us. New things become old things like the way plate tectonics create new land or business at the ridges and they subduct into the mantle after they become out of fashion or obsolete. The less congress does and laws they pass it allows business to create complex niches and division of labor the same way a climax community evolves in an area with no human involvement, disasters, or fires.

Don't waste your time day trading. If you're only 20 you have something way more precious than anything you can ever learn studying the markets, TIME.

Start investing into the market using dollar cost averaging using ETFs/index funds into a brokerage like Vanguard with low fees.

If you day trade you'll lose your money

Well yeah, obviously you'll lose trading if you have no experience, don't study or don't have a mentor.

Hitting high % returns is not very hard with a small account. I know I and at least one other guy here made over 100% in 2014. You can do a lot of work with $10k in a prop account or even as retail with 4:1 leverage. I'd bet poker and trading have similar roi's but poker is significantly harder to scale. Plus poker is way more of a grind imo.

yes, sorry.. i forgot one zero...
700% roa in poker (with a cap to 10k of roll..)
20% roa in trading... (uncapped)

because you generate more cash from less asset (bankroll) playing more table... instead when you trade you can at max leverage your bankroll and do nothing more...

It's certainly not a dying market. The trading markets are the biggest casino in the world, and smart people can absolutely find an edge.

Here's the TLDR: Teach yourself to program. Matlab or java are good choices. Then you can systematically evaluate different market situations, and if the whole thing doesn't work out, you'll have a skill where you can get an actual, well-paying job.


Advantages to stocks vs. poker:
Investing blindly is +EV. If you just buy an index fund, on average it will grow every year. That's a huge tailwind for you, vs. the headwind of rake in poker.

Much easier to put large amounts of money to work. If you want to grind meaningfully with a $250K bankroll, you better be a damn good poker player. $250K is on the small end for the markets -- you can basically commit as much of your roll as you want to any given opportunity. Conversely, if you suck at poker, you can play microstakes against even worse players and learn there while still making money. There's no such thing in the market. Though you can paper trade and see how you would have done in the real world, which you can't really do in play-money poker games as the competition is so bad.

Less time intensive. Your poker game has an hourly rate. You might make $50/hour grinding, or something like that. Market rewards are tied more closely to the quality of your ideas, rather than the amount of time you spend.

Poker will continue to get harder. I made a bunch of money playing poker in 2003-2005. It was really easy back then. I could multitable 200NL and make buckets. I wasn't a great player, I was merely competent, and there were many terrible players. With the competition now I doubt I could win at 50 NL. How tough are the tables going to be in 2025?

Disadvantages:
Much longer learning curve. I've been investing for 20+ years and I'm still continually learning things. I only feel like I really understood what was going on maybe 5 years ago.

Hard to get educated. There are many great poker books out there. There are also some great investing books, but there are many more terrible investing books, and no one agrees on which is which. Personally I think "Where are the customers' yachts?" and the terribly titled "You can be a stock market genius" will put you on the right track.

Lower return on a small bankroll. Professional money managers would sell their souls to make 15% return every year. (Some would probably do it for 7%). To some extent, they're limited by having to manage massive sums of money, and by institutional constraints. I've averaged 30% over the past 10 years and I'm enormously proud of that.


I'd say, absolutely, start learning about stocks as a hobby. The market will charge its own tuition, and it's always better to learn before you have a lot of money to lose.

Just wanted to quote this so you know someone else agrees. Except for the retire in 20-30 years, I agree 100%

That's meaningless to a person considering trading their own account. If that statistic is true, of which I'm doubtful, it must apply to mutual fund managers and not hedge fund managers. Mutual funds are highly restricted on what kinds of trades they can make. Individuals are not. A lot of hedge funds beat the averages, some of them crush it.

OP, learning to trade well is a LOT more work than learning poker. You can't move down in stakes like you can with poker and play clueless rookies. A stock has the same price whether a moron just bought it or Stevie Cohen just bought it. OTOH trading has a big advantage over poker in that you can find out how good you are without risking a dime. You can just make all your trades on paper. You get 100% quantifiable results with zero risk. All the "how to" books tell you to paper-trade at first. If you find that you suck, either study more or give it up, with no money lost.

As to whether it's worthwhile to try to learn, that's hard to say. I have some trading friends that are very talented, started with relatively small bankrolls, and are now independently wealthy. Some have FU money, some can merely live the rest of their lives in extreme comfort without ever working again if they want.

IMO the best way to learn is dive into the deep water. Study and learn as much as you can. Watch CNBC every chance you get. A lot of it is BS, but it still has value for newbies. Find a Money Show near you and go.

A good correction like 2000 or 2008 makes an investor out of you sort of the way your dad made a man out of you by hitting golf balls at you when you were in protective gear as a kid.

The problem I see here is even though you are in an index, the average investor can still lose by selling after the corrections. The crowd sells at the bottom and buys at the top, but at least it is not in a small fund or hedge fund where the manager has to sell when prices are attractive and buy when prices are overvalued.

As others have said, just stick to the S&P or a similar index fund. Day traders are a dying breed whose job is done better by computers. There are much smarter outlets to invest your time.

so, fund manager underperform the mkt 90% of the times, like every normal person

etf and investing in index provides ALWAYS better results?

please, tell to those who bought qqq (or what was available at the time) back in 2000 and couldn't stay in the strategy cause at a certain point they needed the money
tell to those who bought financial etf back in 2008..

do you think that the fed will print money forever?

i don't think any of you have ever managed other people money, and i can tell you, you can't buy the dip or adding to a losing position, you have to put your stop in, minimize the risk and prevent the capital, and guess what, by doing so you lose a bit of money to the market but at least you don't make some awful losses.

now, i don't hope for a market correction (-10% or more), BUT it's inevitable sooner than later, the level of this market are too high, and seriously, fed can't save the economy forever. actually i stay bullish, but as long as thing changes i'm ready to jump off the train.

investing in indexes it's ok to me over the long run, and by that, i mean 2 or more years.
i don't think i'd up by the end of the year more than 70% if i buy the spy today. but i think i'd be up 100% of the time from here to 3 or more years.

actually i think the safer combo is taking some spy 60% tlt 40%, only two etf, rebalance yearly, this strategy is very simple but very effective..
BUT i think a much better strategy could be take euro stoxx 50 for this year, as soon as draghi announces the qe, european stocks are too much undervalued and they're alreayd pricing stagnation from here to years to come.


saying that, daytrading is safest than investing, you don't have a black swan blowing out your account overnight (and i did have it lol) but the % of losing are higher, 97% lose, 3% win. it's a really skill intensive game, much more difficult than poker, if you spew 1 trade you can ruin the entire week or month...

I also agree with this. At 20 your first goal should be to get a job with high future earning potential. If you live below your means, and invest in low cost index fund retiring in 20-30 years will not be difficult. You can retire in even less time if you have a high monthly income and low monthly expense.

The fed can not save the economy ever. They are directly responsible for the housing crash. Yes, they may have saved some banks at the expense of savers but that is about it. The Fed as a whole only hurts the working man at the expense of bankers, lawyers, and politicians ALWAYS!

2 years in an index is not a long time and you almost have a 50-50 chance whether you are up or down.

I think you should be at this time high in equities. There are too many stocks that pay 3% plus in dividends and will only grow those with inflation. The only possible debt is high yield corporate debt, preferably buying the bonds directly. European stocks are looking better, with many paying 5% dividend. Australia/NZ is looking good. DOO pays 5.06% yield right now.

This forum has turned into half intelligent investors and have full blown ******s.

Hey guys I have this sample size of 1 over a time frame of 1 year, look at what he's done!!!!!

Or hey guys, I'm going to totally straw man the **** out of indexing and compare it to a 100% nasdaq index instead of what every indexer was referring to (a proper allocation) and then spew some other random ****.

And god only knows what the **** steelhouse is rambling on about.

Just because you have an opinion on a subject, doesn't mean you're right, and doesn't mean spewing that garbage is helpful to OP. PLEASE OP just go buy john bogle's common sense on mutual funds and read william bernstein's 4 pillars of investing. Your future is worth spending at least the time it takes to read those 2 books. And they are literally worth their weight in gold if you read them in your 20's. I PROMISE you won't be disappointed.

edited to add: In before dickflud comes in and responds with some other garbage with tiny sample sizes pretending to be an experiment in something he's hugely -EV in. But at least I have him on ignore so I won't have to read it.

I was LOLing this too

Make sure you setup a DRIP plan and reinvest the dividends. That is a huge driver of portfolio growth over time.

Markets been great in 2014. and the expected xmas rally as usual makes up for the new year. I day trade DAX mainly, but follow all US, asian and EU equities.
As a day trader (retail trader), its really tough to beat the market. Unless you can compete against ML or GS information or buying and entries on in markets.