Million Dollar Traders vs Full Time (FT) Retail Traders

A long time ago, I wrote about Million Dollar Traders which I chanced upon on YouTube. It was rather interesting and a reader wrote in to ask for a review. I thought of going one step further and share what a FT retail trader does as well. I figured that a comparison is more fun than writing about a day in the life of a FT retail trader. 

In Million Dollar Traders, a bunch of normal people learnt the ropes from an ex City trader and they start their day by reading the news to gather ideas for the trades they are going to place. Both ACCICB and I are self taught so there's no mentor so to speak to guide us. I'm not sure whether they learnt FA and TA or just TA but I apply both and ACCICB applies mainly TA. 

What I do every morning is a little different from them as I go directly into Google Finance whereas ACCICB uses Marketwatch to look at the price charts, read a little news on how the U.S. markets ended last night to see its effect on JPY market when it opens. ACCICB used to watch CNBC but he said it messes his mind so he stopped. I basically scour the news on the companies on my watch list and may read some general news here and there.

I'm not sure whether the rookie traders in Million Dollar Traders place pre market orders but ACCICB doesn't in general but for low liquidity stocks, some queuing is involved if you want to be able to execute the trade at a desired price level. On the other hand, I do place pre-market orders as there's a certain price that I want to buy or sell even for stocks that are not of low liquidity. 

Unlike in Million Dollar Traders who calls a broker for their trades, I use OCBC, SCB and IB whereas ACCICB use DBS and IB. The online platform means that there can be times when the system is down which is why you need more than one broker. The good thing about IB is that you can borrow so you are not exposed to FX risks and transaction costs are low but there's interest to be paid, which means the clock is ticking. 

The thing that stuck with me the most in Million Dollar Traders is the 3 day rule whereby you know whether you have placed a right trade if you can sell with a profit within 3 days. This was a challenge for me given that I'm more attuned to investing but I can see the benefits of having a fixed time frame and I feel good when I'm can hit that 3 day rule. ACCICB has mostly kept to this rule except for the early days when he was still trying to get it right. 

Definitely in both Million Dollar Traders and in real life, it helps if you have balls of steel, am good at Math and have a healthy respect for $$$. After all, it is $$$ we are using, not just some numbers on the screen that magically increases or decreases at the end of every day. It takes a certain temperament to be a good trader and I think that not everyone is cut out to be one. I don't rate myself very highly as I think I still fall under a hybrid which is more investor inclined but yet am an opportunistic trader. 

Unlike in Million Dollar Traders where they just cover LSE, both ACCICB and I each cover about 5 or more markets although we have overlapping markets, which means we basically work more than 12 hours a day starting from 8am in the morning. It takes a toll on us despite it being in the comfort of our home because just imagine scanning charts all day, reading annual reports etc etc. I think eventually we have to cut down on the number of markets but with open positions, the question remains of which market should be let go.

Luckily for us, we have to get out of the house at least 4 times a day to buy food, bring our dog out and what not so that is scheduled after and sometimes during trading hours which means that we have to be very careful about what we are doing if not missed opportunities are definitely going to occur and have occurred. Sometimes we take turns if the other sees no opportunities and sometimes we just give it a miss because we need rest.

I was impressed when Anton Kreil in Million Dollar Traders said that he had only gone out of the office for lunch a few times in his entire career. I can't remember the exact number but I think it was 3 times? out of his 8 years? of working as a City trader. I begin to see why I wouldn't cut it as a real life trader because I think that periods and PMS would be indeed my downfall. In fact, I placed a wrong trade the other day when I was having my period and I was happy to get out the next day with a small profit.

I am not sure whether trading/investing occupies the participants of Million Dollar Traders outside of trading hours but it's like all we think about even on the weekends. In fact, the work continues even on weekends for us and I think it has become some sort of all consuming passion, so much so that you want to come out at the top and you will jolly well make that happen.

Like in Million Dollar Traders, I think its best that we don't copy each other's order books but that's easier said than done. I think its especially key when both ACCICB and I both have our own methodologies and opinions thus it's best not to influence each other's decisions. Of course, there's the usual rage, fear and a whole caput of feelings put out there during trading days so at times I tend to stay away as I tend to make better decisions when I'm alone.

Similarly, we tend to ask each other what is catching our eye and eyebrows may be raised, but when both of us have the same positions, it can tend to be a bit dicey so that's something I want to avoid in the future but for our existing open positions, I still get to hear a lot from ACCICB. Since we don't have Anton Kreil to report our trades to, it really boils down to what we think and do so we end up being the sole decision maker. It can be terrifying at the start but after a while, you get the hang of it and really you can't place the blame on anybody. It's you against Mr Market. 

Comments

  1. Joyce,

    Thanks for the sharing!

    It's interesting to know how other full-time retail investors/traders spend their days.

    Weekends are for me to "rest" my mind. It's therapeutic.

    I'm on "auto-pilot" since retail is in my blood; no thinking required when I'm on the selling floor ;)

    Like you and ACCIB, I do monitor several markets at the same time as part of my intermarket analysis. The difference I guess is that I express my investing thesis or trade ideas on only a few select markets...

    With no one to "report to", it places a lot more emphasis on personal responsibility.

    I've never used my limited brain capacity so much when working for others! The irony!

    LOL!

    ReplyDelete
    Replies
    1. Thanks for dropping by SMOL! You are in your natural element when selling so don't need to think so hard!

      Actually ACCICB is the one who places many trades a day since his Watchlist is much longer than mine.

      Yeah, it really takes away the blame culture and finger pointing game in many companies ;)

      Haha, although now both of us working harder than before but no complaints whatsoever since whatever we achieve is solely based on our merits. Nobody can take it away from us plus it's something that we can do even when we grow old :)

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    2. Joyce,

      It's moments like these that I appreciate the unexpected surprises of blogging - getting to know interesting people!

      Only those who are in the same boat can better appreciate what I meant when I throw out the notion of Trading to Achieve as contrast with Trading to Escape ;)

      Yup, that's my thinking exactly when I look at George Soros, Carl Icahn, Jim Rogers, Boone Pickens, etc; and I go, "Hey! This is better than hanging out at People's Park Chinatown trying to hook up with Mainland aunties."

      LOL!

      I guess speculation has the same mental health benefits as playing Bridge and Mahjong ;)

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    3. SMOL, how to trade to escape, may sink rather than escaping!

      Well my ex boss did tell me that it's best to do a job that you can still do when you are old and preferably your value goes up with your years of experience, I think trading/ investing is one of those jobs.

      Plus no retrenchment exercise will ever be conducted as long as you can preserve your capital and make sufficient cash flow over the ST which will turn into profits in the LT.

      Delete

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