Thinking of Trading - Advice Much Appreciated

I currently trade as an Independent Financial Adviser, been doing that for 15+ years.

Thinking of selling and doing some form of trading.

This would be a semi-retirement type situation, 4-5 hours per day apx.

I would have capital of £ 50k - £ 100k, and would be looking to make a profit of £ 12k - £ 25 k as a minimum per year, i.e 25%.

I would need a mentor / course to teach me the basics and get me started. I obviously would pay for this.

Can anyone please confirm if the above time spent & possible returns are realistic with the right training.

Can anyone recommend a mentor or a course - I did look at Tradenet but after reading the forum here have doubts about their offering.

Any and all advice appreciated.

Thanks in advance

It could take you years to get good enough to break even. As for courses and mentors almost all of them are useless and will just sell you overhyped rubbish. Probably the worst thing you can do is pay someone to train you. You'd be better just cutting down your working hours in your current job or getting something that pays 25k a year with no risk of losing your capital.

Demoncouk said:

I currently trade as an Independent Financial Adviser, been doing that for 15+ years.

Thinking of selling and doing some form of trading.

This would be a semi-retirement type situation, 4-5 hours per day apx.

I would have capital of £ 50k - £ 100k, and would be looking to make a profit of £ 12k - £ 25 k as a minimum per year, i.e 25%.

I would need a mentor / course to teach me the basics and get me started. I obviously would pay for this.

Can anyone please confirm if the above time spent & possible returns are realistic with the right training.

Can anyone recommend a mentor or a course - I did look at Tradenet but after reading the forum here have doubts about their offering.

Any and all advice appreciated.

Thanks in advance

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Buy a bar in Spain/Barbados or somewhere

Much easier

As an IFA, do you recommend any funds that consistently earn 25% a year?

Joey25 said:

As an IFA, do you recommend any funds that consistently earn 25% a year?

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Probably not, buy you arent really comparing like with like. 25% is a realistic expectation, its not easy, buts its achievable with a lot of hard work.

It would be less hassle if you just give me all your money now. Giving it to the market is a lot of stress and sleepless nights.

Some funds yes, can and do achieve 25% per annum on average over 5-10 years, but the risk profile associated with them is normally much to high for a normal investor.

I was looking at this as a 'job', maybe not full time but part time, I understand its high risk, however I do believe people can make money.

I have a client who retired and sold his business 7 years ago and runs 80-120k invested and has for the last 5 years returned 22-37k every year. He does not have any background in the area, a publican by trade and is self taught. I have seen the actual figures so I know it is genuine.

This is partially what prompted me to explore the situation.

I fully appreciate I may not be 'any good' at it, may lose some money on either training or in the market, but thats the same with any new venture.

So if I did want to 'learn' where/who should I talk to ?

You need an edge with a positive expectancy that suits you and your personality type/preferences (assuming you even know them,) - that's the easy bit for most, then you need the necessary psychological skill set to ensure that you can exploit the edge for consistent reliable gain. As another poster has eluded to this takes some time and most don't make it.

You will find that for most succesful traders, mentoring/coaching has little upside to this extent: If the student succeeds it's their victory but if they fail it's the coach/mentor's fault - Lol ! You need to find some one with an altruistic streak who will point you in the right direction, but there are questions you need to ask of yourself before that.

G/L

Have you tried opening a virtual trading account and seeing how you get on after six months (some will argue that you will need longer). See how you get on after six months and tell us all how you got on by posting in this thread.

Think thats a great suggestion, however my basic knowledge is not sufficient to make it a good test I feel.

I have dabbled with individual stocks and made some money, lost some money ( Marconi - LOL ) , but never took it seriously, so I haven't a clue what type of trading I want to do..

I see CFD, Futures, Shorts, Longs etc and I have a basic understanding at best, so what software/account do I use, which do I do ? , how do I set it up etc ..

So I am very happy to 'try it' but where do I start ?

Hence the mentoring/tutoring or course.

This is not to 'pick the winners/losers' as thats something I don't think can be taught in a week, but simply to enable me set up a decent test to see if I am suitable to try and do this type of work/venture.

Bit rambling but hope it makes sense.

Can I also say I really appreciate all the posts and your time in responding..

It's not going to be easy finding a mentor. Lots of scammers out there. Don't throw money at this yet

Demoncouk said:

Think thats a great suggestion, however my basic knowledge is not sufficient to make it a good test I feel.

I have dabbled with individual stocks and made some money, lost some money ( Marconi - LOL ) , but never took it seriously, so I haven't a clue what type of trading I want to do..

I see CFD, Futures, Shorts, Longs etc and I have a basic understanding at best, so what software/account do I use, which do I do ? , how do I set it up etc ..

So I am very happy to 'try it' but where do I start ?

Hence the mentoring/tutoring or course.

This is not to 'pick the winners/losers' as thats something I don't think can be taught in a week, but simply to enable me set up a decent test to see if I am suitable to try and do this type of work/venture.

Bit rambling but hope it makes sense.

Can I also say I really appreciate all the posts and your time in responding..

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1. I concur with all the advice already given and would like to add
2. Start reading couple of books and play it out on demo accounts
3. When you have warmed up trying dipping your toes into a live account not risking more than 1% of capital (or less) per trade
4. Use this site as there are many good persons to give advice as well as the sharks. It won't take you long to fathom out who's who. Good place to cut your teeth as this site is not sterile like other bland sites.

If you were an IFA then you should already be savy enough with most of the speel and jargon anyhow.

Welcome and good luck.

There are many ways to trade and many different markets. Equities, forex etc. then there's timeframe i.e. do you want to trade once a day or make many trades during the trading day. Both have their advantages and drawbacks. Then there's style i.e. fundamental analysis or technical analysis or both?

To make things easy on yourself, choose what you are going to trade, when you are going to trade it and how you will be trading them. And yes, watch out for the scammers.

Just bung a couple of hundreds in a real spread betting account and go at it with minimum bet. The money will be lost, but you will have learnt something. A demo account is not the same thing, and it might give you a false sense that you can trade when you actually can't. Your trading action with a real account causes a reaction from the market. With a demo account, there's no such reaction. If you incorrectly conclude from a demo account that you could trade, you will lose you shirt plus more once you step into a real account. Cheaper to throw away a few hundred with a real account. You can afford it.

BeginnerJoe said:

Just bung a couple of hundreds in a real spread betting account and go at it with minimum bet. The money will be lost, but you will have learnt something. A demo account is not the same thing, and it might give you a false sense that you can trade when you actually can't. Your trading action with a real account causes a reaction from the market. With a demo account, there no such reaction. If you incorrectly conclude from a demo account that you could trade, you will lose you shirt plus more once you step into a real account. Cheaper to throw away a few hundred with a real account. You can afford it.

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Bad advice imho.

It is never cheap to throw any money away. :smart:

BeginnerJoe it seems you are very flippent with advice and other peoples money. Steady on there old boy... Just wait a minute... Impatient to start aren't you. I'd guess you were 20 somefink.

Here is some advice to you. STOP! Do not pass GO! Do not collect £200 but you go straight to jail.

You lose £200 to get out out of jail - providing you have your flexicard with you...

Atilla said:

Bad advice imho.

It is never cheap to throw any money away. :smart:

BeginnerJoe it seems you are very flippent with advice and other peoples money. Steady on there old boy... Just wait a minute... Impatient to start aren't you. I'd guess you were 20 somefink.

Here is some advice to you. STOP! Do not pass GO! Do not collect £200 but you go straight to jail.

You lose £200 to get out out of jail - providing you have your flexicard with you...

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It's a simple calculation. Lose 200, or lose more. I reckon the former is better for the OP. It's extremely dangerous to go around with a 100k, and a full expectation of making 25% a year. The 200 will buy him some reality rather quickly and cheaply.

I am flippent with my own money too. But money spent at life's university often pays off sooner or later. I paid my fees, and I made 100 today. So I gladly advice anyone to pay for these courses. For myself, I usually go straight for the advanced and expensive courses. For others, I tend to recommend the cheaper ones.

I think that a mentor might be more useful after you have learnt about the markets and trading on your own. Trading is so personal you need to find your own way.

This way you will have a better idea of who to choose for a mentor and what you need out of the mentor.

I would recommend you read trading books such as Tharp and Marcel Link, the market wizards, Darvos and others.

Ultimately though I would say forget about it. You need to be really dedicated to the point of obsession (and I am not sure I picked that up in you.) There are so many dead ends to go down until you realise what you were looking for was inside you instead of in a chart. So ultimately I would say if you are semi retiring and you have this £100k cash, go and buy 4 properties at 50% deposit in middle town, midlands or further north, sit back collect the rent and enjoy your property/rent research as your semi “job”. In the right area’s 50% deposit will give a great rental return and with the upcoming inflation the relative rents (to mortgage) will soon look better and better against the loan.

Atilla said:

1. I concur with all the advice already given and would like to add
2. Start reading couple of books and play it out on demo accounts
3. When you have warmed up trying dipping your toes into a live account not risking more than 1% of capital (or less) per trade
4. Use this site as there are many good persons to give advice as well as the sharks. It won't take you long to fathom out who's who. Good place to cut your teeth as this site is not sterile like other bland sites.

If you were an IFA then you should already be savy enough with most of the speel and jargon anyhow.

Welcome and good luck.

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That's excellent advice from Atilla. There's no doubt that it is possible to do what you aim for, but just remember that although some people can run a mile in 4 mins many can't.

In my experience, firstly get a basic understanding of all the ways you can trade eg timeframes / instruments / strategies / methodologies. This doesn't mean you can do them successfully but you at least comprenez what they're all about. Read as much and widely you can (including all the cr@p-- because at the early stages you may not know what is and isn't) and try to see by experimentation (no need to spend real money at this stage) what works for you. Opinions may differ but I reckon good primers are Forman, Van Tharp, Link, Elder.

I'm a fan of demo accounts (but others aren't) since I believe if you can't make system work on demo you stand no chance for real where psychological factors really come into play. One of the problems with demo accounts if you are trading stocks is that your choice of instruments will be very limited compared to a proper account and thus you may be tempted into "trading" something that is not quite what you want. You can get round this by opening a proper account and just using the data from that to paper trade. Mr Spreadsheet is one of your best friends here and if you aren't up to speed with Excel make it a priority. In this game you are dealing with some numerical facts, probabilities and lots of data -- a perfect and well-balanced diet for Mr Spreadsheet. On your paper accounts you won't experience slippage and other such annoyances etc but at this stage you are only trying to get the basic things right -- refinements come later.

You will doubtless go through all the psychological wranglings of tyro traders where you don't persist with what later turns out to be a good system and vice versa. This is just part of the learning curve and it will take time, practice and perseverance to find out what personally suits you. Once you can achieve consistent (and profitable!) results it's time to move on to a real account. If I try a new strategy I always do about 100 trades to get a feel for its viability and then I'll try it for real using very small stakes.

You need to tread carefully -- my experience as a beginner is that you will go down many blind alleys and you need to stop at regular intervals and assess your progress. It's certainly not rocket science but it's not easy either. Once you become comfortable with a "system" you can then start putting as much money into it as you need to achieve the financial return you require. But it took me a long time to find my "comfortable system" and to realise that the system is all-encompassing and a major part of it is the psychological aspect which is the most difficult part to master IMHO.

I wouldn't give up the day job just yet -- try to make an orderly transition and leave yourself a way out if you find that this game isn't for you. Try not to concentrate on the money aspect -- it's very easy to do that at the start but I found that once I paid attention to the actual trade the profits would look after themselves. You will probably "know" when you have achieved your level when you stop worrying about every trade and just treat it as another event which in all likelihood will be successful but sometimes won't be and like when you're driving a car and someone else does something stupid you just take appropriate action.

Good luck (though this game is not about luck, it's about probability) -- it can be done.

0007 said:

Opinions may differ but I reckon good primers are Forman, Van Tharp, Link, Elder.

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Good call, you posted while I was still typing!

I can't fathom the logic of this at all TBH.

You seem to be risk averse from one or two of your replies, so right from the off: are you sure trading is the thing for you?

You're an IFA, you advise people what to do with their money (for a nice fee) and collect whether they win or lose. NO RISK. No criticism for that it's just the difference between being a sports commentator and actually being able to do it.

Now if you believe all the stuff the financial industry on that side spouts you know full well you cannot beat the market blah blah blah. Llong term you cannot btw, it's participation, exposure, low risk entries, cutting losers and money management that tend to be the important things, markets move thousands of ticks/pips per year so don't go poor quick, get rich slow. If you take away leverage no-one is beating the market imo. The best fund managers in the world can't so why can you?

Now, you also say you know of funds that have netted a 'consistent' 20-25% over x amount of years but the risk profile is too high:

Do you believe it's possible for you to then make 20-25% per year, at this point in time, with no trading experience at all, at less risk than an experienced fund manager?

Btw traders don't really look at risk in the same way as the financial industry sells it to the purchasers of funds i.e this is a risky sector, this fund is not hugely diversified therefore risky, this fund made 60% 2 years ago but lost 30% last year, it's too volatile etc etc. Have you really looked at the real risk of trading as opposed to investing. Has it got you sweating yet?

On the flip what was the financial industry selling as 'low risk' a few years back? Cr@ppy supposedly safe, low risk financial funds spluttering away struggling to make 10% when funds in mining etc were making 30% plus. Who's lost all their money since? Which was the riskier fund?

There's also one more thing I found worrying in one of your replies and it's that you had a bit of a punt with some shares, had a few that lost money and gave up. Trading is a losing game, you have to get used to losing and losing a lot. Losing in the right way is a good thing. This very much depends on the type of trader: from your background I'd imagine you will be swing or position trader? Could you handle probably only 25% of your trades making real money, 50% breaking even and the rest losing?

I'm not trying to put you off btw, just PLEASE go into it with open eyes. Start out very small and see how you go.