My OPINION is that trading is cognitively demanding because the best people and computer programs are competing in a negative sum game (commissions.) Under those conditions, how could it not be? Financial markets are constantly evolving and eliminating "edges". When stock index futures were new, Marty Schwartz used to be able to make money in the S&P using the movements of the cash bonds after the bond futures closed. More recently, trades in the weekly stock options that had an edge, no longer do because so many people are selling those contracts. HFT has become a ruthless contest between predator and prey algos as each tries to outsmart the other. For the past nine months as stocks have moved relentlessly higher under low volatility, options traders have had to abandon or adapt strategies such as iron condors or butterflies that were working earlier. Look at how often people here at Big Mike's have changed their methods or preferred markets? The need to respond to constantly changing market conditions makes trading a cognitively demanding task in my book.
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I very much agree with your assessment. Option prices have changed significantly. It's harder to find good "prices" to buy or sell with option position strategies much less with the same r:r as previously ; With Cramer saying 80% of the transaction volume is by HFT and 50% of all investing in stocks and bonds are by the 1% from another source, I think the "zero-sum" game is not so much retail traders trading against one-another as they would like to have one believe, but against or with the HFT and big money moving around. The bought out SEC, NFA, government etc. are just going to continue to make small token public ineffective "fixes and investigations" to assuage the public perception. I recall the Linda Bradford Rashke & Larry Connors book "Street Smarts" where once it was possible to trade with stochastic crossovers ... like back in the 80's or 70's. LBR has adapted while Connors is now a vendor selling black-box "systems" and newsletters. (TradingMarkets.com - Quantified Stock Market Trading Strategies & Systems)
Prop shops that I know of do not look for retail trading experience. In fact, many see it as a negative thing because of all the things they will need to unlearn. I did recently meet a bunch of traders at a prop shop for coffee - only one of them had prior trading experience, the other 3 were completely new to it when they started.
Prop shops whose traders I know personally will all take graduates based on their education, extra-curricular activities (in particular competitive sports) and the way they come across in the interviews. There is absolutely no requirement for prior trading knowledge.
Let's face it - what does the average retail trader bring to the table in the prop world? Very little in 99% of cases.
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For the first 3 years, no I had no job. What I did for a career had disappeared. I carried a laptop to bed every night, fell asleep with it, woke up, carried it into the kitchen to get coffee, into the restroom...
My first 3 years I was beyond obsessed, because I was losing everything I had in my real estate developing. By year 4 I did start a new company, just shortly before I filed for liquidation bankruptcy in my previous business.
Then I worked for another two years during the day, traded when I could, carried a laptop and monitors through airports for awhile. Still slept with the laptop many times, or hooked it to the motel TV and let it run all night, waking up through the night just to watch some more.
I did not keep an hour meter and never even attempted to do the math. My "10,000 hours" was analogous to "paid my dues". How much are the dues anyway? I would have preferred to have known up front, maybe been given the option to finance or make a lump sum payment...
What I guess I meant was, I was hard-core-near-insanity-obsessed to find something that could save me from financial ruin, decided to worship the gods of the markets to find my faith in the future. My approach was not "normal" in many ways.
Thinking about it more as I make some coffee, 9 hours per day is most likely an underestimation. I know there were times I was on it from 7am until midnight, then moved the operation to the bedroom. backtesting, then reading, then playing with charts. I have run backtest marathons over weekends. lol!! A completely fucking nut.....
BUT, it helped me get where I am.
I never did learn to use a calculator though...
Last edited by GaryD; August 25th, 2013 at 02:00 PM.