What can I expect??

[Maestroman]

Hello everyone,

Just found this great site and this is my first post.

I'm basically looking into trading at the moment and deciding whether to give it a go or not. Before going for it (on paper) I'm interested in hearing what everyone's opinion is regarding how well it is possible for someone in my position to do?

A very open ended Q I know, but I would just like to hear from other people who have been in a similar situation and what sort of returns can be expected in this game.

I'm a qualified Actuary so have a reasonable amount of intelligence and financial/investing knowledge, although I have never actually ventured into day tradiung. I'm looking to spend 6 months paper trading spending approx 5-10 hours per week doing so. After the 6 months I plan to start with a bank of £20K and keep up 10 hours per week.

Based on this how would you guys expect my bank balance to look after 6 months/1 year of trading for real.

I'd really like to hear from other people who started out like this to know what is actually possible.

Many thanks

MM

 

[pipmarshal]

Re: .............

Ideally more information like which market and instruments you would want to trade are needed for a fair appraisal. But from the info available, I think 5-10 hours a week would not be sufficient to be a successful day trader. So it would be better to consider swing or short term trading unless you would be able to spare more time.

To be a successful day trader, you would need to spend a lot of time educating yourself and further educating yourself. It is a never ending process of honing your skills and updating.

As for crystal ball gazing, I would not want to do that and guess what your Account balance would be. :cheesy:

Have a nice 100 pips day.

PM

 

[JimyT]

Stuff £500 in to an IG Index account (or whoever) and trade with £2 a point or smaller if possible. I personally think paper trading is almost worthless 'cos you can't simulate the emotions you go through when your cold hard cash is really on the line.

 

[Maestroman]

thanks for the replies. Interesting reading. I agree risking a few bob is probably better than doing it all on paper.

MM

 

[PurplePerson]

I too agree with that. Far better to open a small scale real account - but you really do need it to be truly small as you will quite likely lose the lot during first attempts. Paper trading is no substitute and can develop a wholly misleading mindset.

Maestroman - if you look around this site you will find stacks of posts about people starting out as fulltime traders. Well worth searching.

 

[kinross]

You could start by trading a small amount of capital say £250 in covered warrants. The maximum loss in covered warrants is the stake you put in ie in this case £250. This limits your downside risk. Put in a stop loss of £50 so if the stock moves against you all you lose is the £50 plus your dealing costs.
SG have an excellent informative site at www.warrants .com as well as the LSE site and the dealing sites such as Squaregain, TD Waterhouse etc.
They are not difficult to understand. You can profit from rising (calls) as well as falling (puts)prices. The main differences from buying the underlying shares are that warrants are leveraged so your gains and losses are magnified and warrants have an expiry date. But at the end of the day you still have 'guess' correctly the direction of movement. Don't be put off by the jargon associated with warrants and don't go for the get-rich-quick highly leveraged short-dated ones.
I think they are a good way to learn the markets without risking a lot of capital but then that is just my personal opinion.
Good luck.

 

[timsk]

I'm a qualified Actuary so have a reasonable amount of intelligence and financial/investing knowledge, although I have never actually ventured into day trading. I'm looking to spend 6 months paper trading spending approx 5-10 hours per week doing so. After the 6 months I plan to start with a bank of £20K and keep up 10 hours per week.
Based on this how would you guys expect my bank balance to look after 6 months/1 year of trading for real.

Maestroman,
Welcome to T2W,
Based on my experiences to date, I could write a book in response to your post or at least an extended essay. Panic not, I'll spare you my verbosity and try to keep my reply short!

What Can You Expect!
There are many people on this site who consistently lose money and a smaller percentage who break even. A smaller percentage still make money, consistently. Of these, only a handful make really big profits. The exact ratios and percentages have been argued about on another thread, but probably won't shed much light on the answer to your question. Which of these categories will you fall into? Who knows.

I've no idea whether or not there is a bulletin board for Actuaries like yourself, but, suppose for a minute that there is. I sign up and post saying that I'm comfortable with figures and statistics and as for spreadsheets, well, they really float my boat. However, I've no qualifications or experience in anything related to being an Actuary but, I'm keen as mustard and I'm going to start applying to insurance companies and the like with the view to getting a job. What can I expect?

I would concur with the advice you've received so far that day trading isn't the best option available to you given your time restraints. Additionally, if you want to dip your toe in the water with small amounts of money, then day trading isn't the best option available. That's not to say that it can't be done - it can, but you're really making life unnecessarily hard for yourself by going down this route.

You say that you have a reasonable amount of investing knowledge; have you thought about pursuing a longer term strategy and then gradually reducing your time frame as you gain experience and the profits accumulate? One last thought. Being an Actuary and having the necessary intellect required of such a position is no bad thing. However, if I were you I'd guard against the (over)confidence that may come with it. It may not be an advantage to you at all. The market doesn't give two hoots about how clever you are or how many qualifications you have. There are members of these boards who struggle to write a single coherent sentence when they post, but boy can they trade! (No, I'm not going to name names!) Needless to say, there are those who write brilliantly but can't trade for toffee!

Take it slowly is my suggestion. If you're impatient to open accounts and throw your money at the markets, beware! Almost certainly, you will lose every penny. I know, I've done it.
Good luck,
Tim.

 

[Maestroman]

wow lots of food for thought there. Thanks

I think I'll be going into this game for pure enjoyment's sake rather than with any great expectations of making great profits.

Ta for the welcome to the forum as well!

MM

 

[reidami]

reidami

wow lots of food for thought there. Thanks

I think I'll be going into this game for pure enjoyment's sake rather than with any great expectations of making great profits.

Ta for the welcome to the forum as well!

MM

Hello Maestroman.Although paper trading is not the same, it is worth doing to get into the mechanics of the game .You can feel a bit stupid when you push the wrong button even sitting on your own.