Responses To Trader Q&A

Hey guys. Thank you to everyone who submitted a question on Twitter. I'm going to go through them all here and touch on each one briefly. Lets get right into it.

_________________________________________________________________________________

   
First off regarding screens, a few months back I bought one of these and it was the best decision I've ever made, the thing is just absolutely fantastic. Highly recommend if you've got a bunch of smaller monitors cluttering your desk, this replaces 4-6 of them. Buy two of these and you're completely set. I run 8 separate virtual screens on just one of these Dell monitors, and I've got a few different things up. I have DAS and Sterling up which take up about 50% of it. I watch 8 charts at a time, more than that I find to be a distraction. I use DAS for executions & charting, and Sterling through another account just for executions. Sterling charts suck. So 50% is taken up by 8 charts & montages, the rest is separated. I have a word document open for keeping track of stocks I don't want to forget about and just notes on certain companies I am watching. One window up for Twitter. Another window I have for research, which is sec.gov and Yahoo Finance/Finviz. One window with my e-mail. And the remaining space is taken up by the two private chatrooms I am a part of. (Yes, all of that fits comfortably on one of these Dell 43" monitors. It's great. Then I've got two peripheral monitors on each side, one which I run Investors Underground & Warrior Trading on, and another I run E-Trade Pro on with a couple more charts up. I like E-trade for Level 2 as they have a complete book for free, and I like their charts as well. E-Trade is what I learned to chart on originally, so I am just used to it.

And then I have 4 laptops as well, 3 MacBook Pro's and an HP. Don't ask lol.

I have personal info up on it so I'm not going to zoom in, but you can kind of get an idea of what my main monitor looks like from the picture below. Those E-Trade charts you see have been migrated over to the right monitor, and DAS charts & montage now replace them. And in the center/bottom area where you see that black chart, that is now a Sterling montage, which I use via Cobra.

(You can also get an idea of just how big my main monitor is. That's a full size Mac Desktop to the right of it, which aren't exactly small.)



_________________________________________________________________________________


Two people inquired about this. (Kari I am just including yours in this response as well)

Trading emotions. Listen. We're all HUMAN. Everyone tells you to trade without emotions, but unless you're paper trading, that's just not going to happen - it's an unrealistic expectation to think you can trade without emotion. That said, this is an internal struggle unfortunately, not one someone else can answer for you.  I just tweeted something about this a few days ago, I get asked this question so often "I'm struggling with emotion, discipline issues etc", I said this:


Right? I wish I could give a better answer here, however there is just no possible way to create a generic, overall "correct" response. Everybody arrives at this answer from a different angle, and the ones who truly have it figured out - nobody taught it to them. It comes from within. Also I really do believe the only solution is time. The longer you trade, the more screen time you have, the more crazy things you see, the more you just become used to it and adapt. Just like any job. If you have a full-time job currently, think about how scared or nervous you were on Day 1 when you didn't know anything or anyone. It's daunting and brings out certain emotions in you because it's new and unknown. But now that you've been at your job for a year, two years, ten years whatever - you don't even think about your work anymore, theres no emotion, you just do it. The only way you were able to arrive at that point was through time. So again, controlling trading emotions is by far the hardest part of this game, but there's no quick fix or solution to it - just time. If you go back through some of my old posts, I talk about emotions a lot actually and can give you some insight into how I handled mine. Its a constant learning process - it never ends. Trading emotions are not something you "master" - you just get better at dealing with and managing them, but they never go away. Ever.

In regards to a trading slump - I would say this. Don't get discouraged over a bad day or a bad week. Someone put it to me this way: "Red days happen, brush them off. Red weeks happen, brush them off. If you start to see red months, then we have a problem and a serious revision of your process needs to be done." The worst thing you can do is let a trading slump get to your head. This is much easier said than done, but it needs to happen. You need to have an unwavering, 100% confidence in yourself. If you take a loss, there needs to be no doubt in your mind you'll make it back. And don't try to get it all back at one time, thats what you just dig the hole deeper. You need to have an extremely short memory, show up each morning with a clean slate, no matter how good or bad the prior day was, each day is new. I don't pay attention to streaks, any of that stuff. Each day is its own, and my only focus is on doing my job, one day at a time. 

_________________________________________________________________________________


Brokers.....ok. So I started out like most who didn't have a lot of money, at Suretrader. Which obviously is not ideal, but it is what it is. When I was there, the borrows were actually some of the best around, thats since changed drastically, making a hard task even harder for those there unfortunately. But that's no excuse. I hate when people complain about ST. If you're failing to build your account, I can guarantee you its not Suretrader's fault, it's your fault. "My commissions are too high" - no they're not. You probably overtrade or aren't using the proper size or have way too little money to be trading in the first place. The point being that ST is not the greatest place in the world, but it is manageable and you can make it out of there alive if you're doing the right things. It may take them a few weeks to wire you your money lol...but they will do it. I've never heard of anyone not getting their money. So people who say "I dont trust Suretrader they're sketchy"...ok, they are a little sketchy, but again, have never heard a single story of someone not getting their money. Have you? So while yes they are sketchy, I don't think you should be afraid to use them. I literally only wired out of Suretrader ONCE in my entire life lol, when I finally got over 25K, I wired out like 28.5 I believe it was and moved to Interactive Brokers. It took Suretrader a little over 3 weeks to send my wire, but they did send it.  

Currently, I have four accounts. I trade at CenterPoint via Vision, Cobra Trading via Wedbush, E-Trade, and Charles Schwab. I do a majority of my daytrading at CP Vision, as they have the best short locates bar none, the instant locate monitor which is nice, and they offer DAS Trader which is my preferred weapon of choice. So I'd say 75% of my trading happens there.  The other 25% is at Cobra. Cobra is great because of their overnight policy - $0 fees on all o/n positions which I love, so if I want to swing something, I'm doing it at Cobra. They clear through Wedbush which has very good borrows, not quite as good as Vision but it's close. And again the $0 o/n fees is my reason for being there. CP Vision is 3x the borrow fee + the initial borrow fee so really 4x the borrow fee to hold overnight - which can get pretty expensive when you have some size.  No bueno. So no swings at Vision unless I can't get the borrow at Wedbush. They don't currently offer DAS but that's changing very soon. They do not have instant locates, you locate via AOL Instant Messanger, which is not ideal but not the end of the world either. The two guys who source locates for you are very helpful, timely in their responses, and typically the entire process to get a locate takes about 2-4 minutes on average I'd say. CAN be a big deal if there's some random intraday runner and time is of the essence, but that rarely comes into play. So it's really not a big deal. I use Sterling through them as well, and simply keep the montage up for executions, I don't use their charts. I like Sterling for one particular reason, if you have a limit order out and the bid/offer move on you, you simply right click on your order and can change the price very easily in .01, .02, or .05c increments. That is much more convenient than DAS in that respect. So that is the best thing about Sterling to me, otherwise I prefer DAS for everything else besides replacing limit orders quickly. 

Also, ETC clearing sucks. It just sucks. If you have an ETC account, I'd close it. Just not a good place anymore, they're really struggling internally and financially from what I understand, and they've just gone downhill overall unfortunately, they used to be a great option but not anymore in my opinion. Vision, Wedbush and IB are much better options.

Then my other two accounts, E-Trade I currently have no money in and just use their Pro software for the full L2 book and their charts/news. However I will be loading that account with money soon too as they are a good swing trading option as well. And then I use Charles Schwab for all my longterm stuff, my Traditional & Roth IRAs. If you want to trade as a full time profession and don't have an IRA, you need to fix that. As traders, sure we have freedom and tons of perks working for ourselves, but the one downside is no benefits. So you need to take care of yourself, start putting some money away in an IRA in a few solid, dividend paying companies preferably. For example, in my main IRA I hold the following companies: $T $BAC $GE $VZ $DIS $WMT. Set up an IRA ASAP if you don't have one. Your future self will thank you handsomely 30 years down the road.

_________________________________________________________________________________


(He's making a joke from my last blog post about the coke lol) Don't do drugs, drugs are bad. The rough part before profitability is...rough. You're going to feel like absolute crap early on, you'll feel like an idiot, like you can't do this, and like all hope is lost. I wrote an entire blog post dedicated to this topic as well, called An Open Letter To Aspiring Traders, What You're Actually Getting Into and How To Prevail. It takes a special type of person to remain vigilant and motivated through those times. Again this is another question where I wish I had a better answer, but this is not something that words can fix or solve. This is a personal attribute that comes from within, and everyone reaches the destination a different way. It's completely dependent on the type of person you are. There is a reason more than 9 out of 10 people who try their hand at this game fall flat on their face. It takes an unbelievable amount of guts, determination and resilience to push through early on. I say it all the time, the more money you have, the easier trading gets. This is also why I discourage anyone with an account under $5000 to stop trading and save up more. Even that is nowhere near where I'd like to see you start. 30K is really my absolute minimum suggestion to start with. The game is hard enough as is, don't make it harder trying to come from nothing. The FURUs who sell you pipe dreams of turning $500 into $1M are disgusting, I don't know how they sleep at night. They prey on people's dreams, and take money from those who are damn near broke and desperate for a lifeline. Makes me absolutely sick. Can it happen? Sure it's happened, some have started with a minuscule amount of money and made it. Even I sort of did it (after all my blowups, the account I "made it" with was 11K, I grew that into what I have today) But that is NOT the preferred approach to creating a career in trading. You take your odds from about 10% to about 0.001% if trying to do it that way. Well I guess with 11K we'll call my odds closer to 1%. But for the guys starting with $1000...$1500, or less even, I really mean it, your odds are well, well below 1%. Give yourself the best possible chance to succeed. The more money the better. 

_________________________________________________________________________________


New Jersey is great, contrary to popular belief.  Born and bred here. That goddamn Jersey Shore show destroyed our reputation, that is NOT what Jersey is like. Fuckin clowns. I live in rural North Jersey, it's beautiful, and it doesn't smell lol. We have attendants that pump our gas for us. That's nice in the winter. We're called The Garden State for a reason - famous for our tomatoes, corn and eggplant, best you'll find anywhere. We have some of the best Diners in the world. Our pizza and bagels are pretty awesome as well. The secret is in the water I guess. I know of restaurants in Central US and West Coast places that actually have NY/NJ water SHIPPED out to them to make their dough with. No idea why, but something about Jersey water makes bagels and pizza dough taste better. Some parts of the Jersey Shore are sleezy and full of guidos and assholes sure, but only a small part. Most of it is lovely. Specifically Long Beach Island and Wildwood Crest. As far as tourist attractions or sight seeing, I guess there's really not much. But I wouldn't live anywhere else. I love it! 

_________________________________________________________________________________


.............what the hell is a Pork Roll? :) 

_________________________________________________________________________________


I wrote an entire blog post on this, so rather than repeat myself, you can read it here. It's called "A Simple Guide to Finding your Niche." 

_________________________________________________________________________________

                                         

I love you Tim. Just not when you're being a little weenie bashing short sellers :) However when I start to travel, you'll be my first call. Lets fish and chop some wood and shoot some shit. Testosterone! 

_________________________________________________________________________________


This is another one I'll draw an excerpt from an old blog post: 

_________________________________________________________________________________


I just posted one about SNAP here. I doubt I'll get back to doing these too often, they're rather time consuming. However, I'm happy to announce I'll be joining the Investors Underground team and co-hosting Webinars with Alex soon and then eventually doing some myself, and in those I plan on reviewing a bunch of my trades, so keep a look out for that in the near future. 

_________________________________________________________________________________


Again some questions just don't have a tangible response, refer to the second question in this Q&A for that. I wish I had some better info, but it's really futile to try and explain it as everyone is different. Everyone has a unique experience, sees things in their own way and evolves at their own pace, and has to deal with these hurdles individually, there is no generalized explanation here. 

_________________________________________________________________________________


What I wanted to see from my trading before sizing up.......hmm. Tough one. I'm not sure there is a "switch flip" moment where on day you're trading small and the next you're using size. It's a slow, gradual process, thats how I did it at least. First and foremost, prove to yourself you can stay green for at least a couple months straight. 3-4 months of profitability should suffice. Once you've done that, and you're building a small cushion, I'll tell you the way I started to size up. Say a normal position size for you is 1000 shares, and you want to now size up. Don't just automatically double your size or more and just dive in, you'll be an emotional wreck. Start small. So my approach was I'd take my normal 1000 share position, and then immediately after, 3-4 minutes later, I'd just put another 200 shares on. And just get used to watching that 1200 now instead of 1000. Say you want to build a 2000 share position. That may sound daunting to you. But starting in 1000, then adding 500, then 500 may be easier. Thats how I felt most comfortable. So take your normal position size, then a few minutes later, immediately add a couple hundred more shares. And just slowly continue that process at your discretion, all while remaining fairly comfortable of course (you should feel slightly uneasy as well, a little discomfort is healthy. It means your pushing yourself and making progress. If you're constantly comfortable and complacent, you'll never get anywhere.)  And again, theres no "Today i'm trading small, and tomorrow I'm sizing in" - its a very slow, gradual process if you want to do it correctly. Otherwise you'll likely do more harm than good if you try to make the jump too big or too soon. 

In regards to the second part of this question about the numbers - I don't think of any of that stuff. I'm not a numbers guy like that. For a more detailed expansion of that, read this post. Basically I think a hyper focus on "numbers" just hurts your confidence when you're already struggling, and it is a distraction. Take it one day at a time, and just focus on trading well. The numbers will take shape if you can do that. 

_________________________________________________________________________________


Lol I gave up on the flipping houses thing. Well not gave up, but it seems it's just too labor intensive to juggle alongside trading for right now. So instead, I've turned my focus to buying commercial investment properties. Multi-family homes and renting them out to create a passive income stream. And yes, one of the meetings I have today is with a real estate investor who's been doing this for 25 years and kindly offered to get dinner with me and share his knowledge. 

_________________________________________________________________________________


I won't be posting my trades very often. I'm trying to get away from the public re: my actual trading for the most part, and outside of my few trading partners, my journey will primarily be a private one from here on out. Sorry about that. But I will be sharing some stuff here and there and in webinars soon. 

_________________________________________________________________________________


Bouncing back from a loss....what an important part of the game. Super, super important. I just explained this in a blog from a few days ago, you can find it here, I suggest reading the entire post, but to specifically answer your question, you can scroll down towards the end and start reading from bullet point #2 titled "Intensive Indifference". 

_________________________________________________________________________________


This is not my game. Nobody knows how or when the next market crash will come. People have been calling for it for about 10 years now lol. Your guess is as good as mine, and I don't speculate when it comes to this stuff. I just trade the action thats in front of me, one day at a time. 

_________________________________________________________________________________


Another tough one here. And again not something with a definitive answer. The key to managing this is all about getting your ducks in a row. Please read this post for my best advice on how to do this. The most important key in making this work is to avoid pressure at all costs. You need to put yourself in the best possible situation to succeed, and rushing into a trading account if your financial situation is extremely tight is a sure fire way to fail 

_________________________________________________________________________________



OK! That completes the Q&A. I hope you enjoyed it and I adequately answered your questions. I really had fun doing this. Will definitely open this format up again in the future and do another one.

Hope everybody is enjoying their weekend, and I'll see you out the there Monday morning.

- D


Comments

  1. Great stuff, tons of solid info particularly the broker section top notch for new guys!

    ReplyDelete
  2. Good as always. Thanks again and again for ur inside thoughts.

    ReplyDelete
  3. Monitor size and spacing is very personal as well, I went from 6x21s to 6x27s to 8x22s + 6x27s. I did not find the larger 27s liberating at all. I watch 24/30 charts (not all are in play at anytime of course).

    I also found that older smaller monitors can be had for a pittance (8x22s Dell Professionals can be had for 100/per on sale which is barely over 1K with Ergotron mounts)...heck of a deal if one if patient for sales. Whereas, the 27s 4K ones, or larger go for stupid premiums that are not worth it IMO and will be more fairly priced in the future.

    You make very good and very informative points, and your posts are very valuable bereft of hype, bravado and know-it-all 'ness that populates almost every retail journal out.

    Thanks for sharing your stock trading journey, many common themes to most successful traders out regardless of what market one speculates in.

    Also, a very wise old trader told me once...something I learned only after a great of pain......which you already hit on the head....trading with knowledge and acceptance of your own fear (and greed), rather than trying to eliminate it is a very powerful positive weapon. It can be turned into a powerful ally.

    Again, thanks for sharing your journey, very nice to read the travels of a seasoned speculator.

    ReplyDelete

  4. When I started trading in the CFD market, I felt that I was lost and that I would always remain a novice. I was totally unfamiliar with the trading aspects in this competitive market. I made several errors and consequently suffered losses. I even considered quitting before I stumbled upon FXB Trading. The documents and the tools this website gave me were like a life saver for me. I am now trading with confidence and assurance.

    ReplyDelete

Post a Comment

Popular posts from this blog

A Scope of My Plans To Become an Elite Trader

PRESSURE: The Number One Killer of Trading Psyche

My Year (or Two) in Review, Critical Lessons & 2017 Goals