i am guessing trader jorge is one, but not 100% sure. i've finally decided it is what i want to do mainly because i like looking at charts and research and all that. it's pretty much completely consumed me since i graduated and it has nothing to do with my history degree. anyhow...i've just finished reading Reminiscences of a Stock Operator by Edwin Lefevre. an absolutely amazing book in my opinion since it shows you how nothing ever changes in stock trading...it was written back in 1928. right now i have a small account and i have just been playing around and testing things and getting experience. i've lost almost half of my money, which really is only a few hundred dollars so its not a big hit to me, but i've also seen myself get significantly better with stock picks because i am starting to see what drives them and i am also learning discipline. i've finally discovered some patterns that seem to repeat themselves that aren't explicitly talked about in technical analysis books. and i also notice that when i see them and i read their charts correctly then i have been almost always right with what the stock will do if i pick it to go long. kind of hard to find easy shorts right now and why try to fight the uptrend is what i am learning. i've started keeping diaries everyday and going thru numbers and charts and taking notes on the stocks that i want to watch and the ones that i think will be bigger winners. yes i know it is a bull market and everything is going up, but i tend to notice my picks far outpace the market. anyhow...only time will tell if i am actually getting better or if i have just been lucky for this past couple weeks since i have started becoming more disciplined. now i just need to get some more money saved up and see how i can do with that. i know this is what i will do with my life, but i was just curious if there was anyone around here who had any advice and if anyone here is actually a stock trader that might be able to give me some more advice. one last thing...i am not looking for tips on investing...i am looking for people who have made trading their career. also i am not trying to use this as a get rich quick scheme either, so i don't want to hear condescending remarks treating me as if i have no clue what i am talking about and as if there is no one who is successful at stock trading and that i am only looking at this as a get rich quick thing. i know the people who lose are the ones who only do it part time and who don't learn. losing that few hundred and being as cheap as i am has taught me that you can't screw around in trading or else you will get killed. so does anyone do this for a living?
One of my friend use to trade by now he's into trading derivitive. It's a big gamble and I wouldn't want to go into it. First thing first, you need to know what you are doing and have the money to fool around with. I mean this really suck because if you lose, you're giving your money away for free. I have heard lots of story of people making and gaining lots of money but it's not a good ratio. you could be lucky or you will never win anything. IT's all gamble and the only way to make money is with lots of money to start out with. IF you think doing this for a living, you gonna need the money to do this in the first place.
well i'm not looking to gamble or be lucky. i know 85-90% of people lose money at this in their first 5 years. thats why i had that little account started now so i could start learning things and "pay my tuition". i'm not looking to get into things i don't know like options or derivatives or anything that i don't feel comfortable with...doing things that you aren't comfortable with is the quickest way to get killed in the market. one of the first things i've learned. i'm also not looking to live off of other people's tips on stocks. i'm not going to be trying to have knowledge of everything when i start. that's why right now i am sticking to stocks and stock charts i feel comfortable with and with things that i see and i can read relatively well. i've also learned not to just hold on to things if i am losing money in them and to be successful you have to know when you are wrong and minimize it. i know i need a pretty good amount of money to get started in it since transaction fees will kill you if you don't have enough money. So does your friend do well in it?
I am not a trader by profession, but have been actively trading stocks for the past 7 years. I have read several books on technical analysis and have spent a good amount of time on the subject over that time period. I think you're taking a smart approach to it in that you realize that you don't know everything just because you saw a couple of double bottom formations or a cup with handle. It's good that you realize that it will take time for you to understand the intricacies and depth of the subject. If I were to give you advice, I would tell you to read as many books and materials you can on the basics of technical trading. You have to have a foundation of knowledge to base your career on. It sounds like you did not get that foundation from your schooling, so start reading books, brother. The other point of advice that I might suggest is to find a good website that subscribes to the technical theory of your choice. Instead of pouring over stock charts yourself, you can many times find the same type analysis on a website. Even if the site charges money, the time saved on your part will be well worth it. A lot of them have screens they can run which will instantly give you all the formations you might be looking for.
This could be the beginning of the end for poor robbie380. When you say "my picks have far outpaced the market" and then say something about "i have just been lucky for the past couple of weeks", you're scaring me man. Be careful. I'm not saying you're not the world's greatest stock picker, but "common folk" like us have been eaten alive in the market thinking we could outsmart people that have been doing this for a living or we could outsmart the market over the long haul. Very few mutual funds over the course of the past few decades can consistently beat the market. Many of them are run by people with several years, even decades of watching the market, technical charts, indicators, etc. and still fail to beat the market consistently. I'd hate to see somebody sink their money into this and lose it all or most of it. This reminds me of the mid-to-late-90's when everybody was throwing darts at a wall and coming up with stock 10-baggers (myself included). People were letting it go to their heads that somehow they had "the secret". I read about some girl working in sales or an ad agency say she quit her $150k (or maybe $250k) job to professionally day-trade. I thought she had lost her mind. Then by about 2001 you read about all those taxable accounts where people lost 30-80% of their money because they had "the secret". People often talk about how much they can make in the market because they have it figured out, but they never realize the opportunity cost of losing a lot of money early in life. Compound your losses out and then when you're 60 consider you may be saying "damn I wish I hadn't blown that $5000 - it'd be worth a lot more now". Anyway, I enjoyed my ride through the telecom and Internet boom during the late 90's that saw mutual funds returning 90-140%, stocks doubling and tripling in 1 day, and I saved most of the my earnings from then because I wasn't greedy. But as I said then and I'll say it again, it wasn't because I had some "secret method". I just wanted to jump aboard what Alan Greenspan would call the "irrational exuberance" train. Luckily I got out before the wreck. Good luck, and I hope you know what you're doing, but I'd be scared to master what I know I sure as hell don't have the brains to comprehend most of the time - the stock market.
I do it for a living. Been working at Morgan Stanley for about 2.5 years under two Senior Vice Presidents. False: "I know the people who lose are the ones who only do it part time." True: "Losing that few hundred and being as cheap as I am has taught me that you can't screw around in trading or else you will get killed" If you are looking to get picked up by a big investment firm, change your attitude. You seem like a very nice and smart guy. You are trying to outsmart the market when you pick single stocks if you don't have a conection to that stock: ie: you work for that company. you know of ground breaking moves the company is making. ect... Every major "single stock trader" is being systematically removed from the major investment firms. These guys are geniuses too! Problem is that they think they are smarter than millions of researchers with 5 doctorates and lifetimes of experience. BTW, keep in mind if you plan on building a luxury clientel, don't sell them on recent or newfound performance. Sell them on your companies vast resources. Sell them on the fact that your firm is out to preserve and protect their wealth and savings and that you are their personnal embasidor to their families goals. You should never invest unless you are investing to achieve a certain, realistic, and conceivable goal. Set them out a plan based on their specific needs (ie: are they a teacher, parent, grandparent, newliwed, on the brink of retirement, established business owner, ect.), constantley realocate their investments for them, possibly once a month, to make sure their plan is still balanced out they way you first divied out the plan. Don't think 7 but 77 times before changing the plan based on current market conditions. Less customers, more attention. That's my only advise... please don't take any offense as I hope you have a long and successful career. Your friend - Subliminal Shot
what books would you guys suggest for someone wanting to learn more about reading charts and doing technical analysis?
Well thats about all I have been doing since I graduated from UT. I've probably read 10 to 12 books since May on trading and investing, which is pretty amazing coming from someone who hated reading all his life and never started reading for fun until I found this. I plan to be continually educating myself and learning. So if you know of any good books to read post em for me. Reminiscences of a Stock Operator is by far the best one that I have read so far. It is almost creepy because you'd think he wrote it last year, but he wrote it nearly 80 years ago and he is talking about stuff from a 100 years ago. About the technical screens...I've found it better for me to just look at the stocks that come up after I put in my search criteria. Like here is what I have found works pretty well right now and it can only really be used by small time traders because of the lack of significant volume problem. I use 10k volume avg over the past 30 days then more than 50 cents a share then anywhere from 300% volume breakout that day up to 1000% vol breakout on that day. What I've seen from stocks that I missed out on is they seem to have the common thread of large volume breakouts from periods of low volume activity. So like the stock has 40k 30 day avg vol and then suddenly one day it busts out to 700k for that day. Generally, from what I have read and what I have seen volume leads price...it's hard to tell which direction sometimes but generally a huge volume breakout is followed by a significant rise or drop in price. Ok so from that volume breakout I'd then look at the chart and see if I like it or if I have a feel for what the stock might be doing. Then I will also look at the stock's fundamentals and news to see whats going on with it. I have seen that the best performing stocks after volume breakouts are the ones that finish slightly higher that day, not much %-wise, which would seem to indicate accumulation. Further I look for no news in the stock and it seem as if it's been best when there has been no news to speak of for months. With all that being said you can see that I'm looking for something pretty specfic plus I have to want to be comfortable with the stock chart, which is something I can't decide until I look at it. So that's the general thing I try looking for right now. Also by looking at all these charts I am hoping to start seeing other patterns that develop that I am not familiar with. Anyhow...I wish I could see how stuff like this works in a bear market or in a sideways market. None of the shorts I have tried with this work and I'm not sure if that's because of the market being how it is or because this is a poor way to find shorts. I will probably have that chance soon since everything is shaping up like the last time stocks went thru the roof and the same mindset is taking over again. Anyhow...that is all speculation on my part since I don't follow the general market as much as I need to start doing. So if you have any books or websites that you think are good post em....thanks for any more help you can give.
I think you may have misread how I was saying it or maybe I didn't communicate it very well. When I was saying things about the picks I have made and being lucky I was trying to say that I am still ignorant in the market and the things that I have found since I have become more disciplined with how I approach things and actually selecting something, even though it is just paper trading, have worked very well. I don't mean to say it like they are stone cold locks to go up. Also, the luck thing I said was because I have not been onto this criteria for finding stocks for very long and I don't know if it is actually the things I am looking for working or if it is the market driving up the stocks I find since it is a wild bull market. About mutual funds...I think it is something like 80% will not beat the market average. The main problem with them from what I have been told and read is that they are handicapped from the start by a trading philosophy they have adhere to. Like only trading one sector or one group of stocks even if that group is doing terribly. LOL...well I'd hate to lose everything too. Hopefully, I have started to learn more about controlling my losses and not trying to win back what I lose. I'm starting to learn that if you don't know what is going on then don't trade because if you do then you get killed. I don't have any secrets to what I am looking for and I am pretty aware of how crazy the market is getting and how things really haven't changed since the bust. But I also know that this is the only thing that I have ever devoted this much time to in my life and it's what I spent 5 years of college trying to find...something that I have a passion for and that maybe I have some talent at. Only time will tell if it is talent or just dumb luck right now. I'm not over zealous about getting rich quick and all that and I know that the market is always right. I don't believe in the efficient market theory, but I believe that the market is ALWAYS right. I remember this one quote from a guy who said something like it's ok to be wrong but it's a crime to stay wrong...meaning if you make a mistake get out of that position and don't ever hope things will turn around for you.
Are you talking about "day trading" for a living? Believe me, they're not around anymore. Drunk and stupid is no way to go through life, son.
About the part where you stated false to what I said I think you may have thought that I was saying if you do it full time then you will make money. I wasn't saying that, but I was saying if you do it part time or if you just dabble in the market then you more than likely bound to get hurt badly in the market. I was by no means saying that if you make this your profession then you will make money. Just because someone adopts this as their profession doesn't mean they take the right philosophy to trading and to learning from their mistakes. Like I was saying in that last post to DOD....being wrong is ok but staying wrong is a crime and hope and fear are 2 things that should not factor in to your trading or else you will get killed. People who try to fight the market and not accept that the market is right and they are wrong are the ones who lose. That is one of the first things I learned...never fight the market....the market is bigger than you and it is always right no matter what one believes to the contrary. I've read the stories about how highly educated people fail in the market and it's because of those reasons that you stated and that I just stated. People who think they can outsmart the market fail. It's not about outsmarting the market but with finding the correct trend and going with that path of least resistance. The difficulty is finding that trend and finding out what is really going on and if you are wrong then don't stay wrong. Don't hope for things to change. Thanks for the advice any is greatly appreciated.
I dunno about day trading but making stock trading my profession. Day trading is too questionable in my eyes and I really don't know much about it so I don't think I would want to do it.
There are tons of books out there and most are pretty much the same. I stopped buying those tech. analysis books and instead I just read them at Barnes and Noble in the coffeeshop there. God am I a cheap b*stard or what? Anyhow the main reason I don't buy them is because they are overpriced and you can generally find explanations of technical terms and indicators on the internet. Like goto stockcharts.com and just look at the glossary of terms they have on there. You can get a pretty good education from that for free. But if I were gonna say one book that has everything in it then it would be anything by Pring. I can't remember his first name....I want to say its Martin J. Pring, but I'm not sure. He probably has the best books on tech analysis and the most in depth. I would also say the best book to read if you want to start learning about trading is the one I mentioned like 10 times in this thread. Reminiscences of a Stock Operator by Edwin Lefevre. I've never finished a book that fast in my life. If you've done some trades then the book will hit home even harder for you because what he says is all true and it shows you nothing EVER changes in the market. Fear, hope, greed...they are all still there and will always be there. If you are going to trade then make sure you learn from your mistakes and realize that the market is always right.
