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Frequently Asked Questions about MTrader and Daytrading


Why don't you have any performance records?  How do I know you are any good? 

 

As I was reading Joey Anuff and Gary Wolf's book "Dumb Money", I came across a passage they wrote about us. 

" The most dramatic, least believeable evidence for a trader's skill is an unverified record of successful trades, and there are countless Web sites that combine outrageously brilliant predictions with an invitation to join up for access to the next winner.  This wasn't what I was looking for. Wolff's site, Momentum Trader (or mtrader) didn't list a single successful pick. Not that he didn't brag: its just that the self-praise on mtrader was devoted to the quality of the instruction.. "  

I like that.  That really is how we feel about it.  It was a lot easier when I was starting out because there was almost no such thing as trading education, and a really small handful of chatrooms.  I feel sorry for anyone learning now. It must be a jungle out there. 

The truth is that you don't know if we, or anyone else for that matter, are any good.  Calls mean nothing. I can make a hundred calls a day, but if those calls are vague, after-the-fact or untimable, what good does it do anyone?  Let's say I make a call on a stock from 25 to 26. One person might catch it perfectly and brag. Another person might hesitate, enter late and come out with 50 cent gain.  Another person might actually hold as it tops and heads back down, and come out with a loss. All on the same call!  I have seen it all.  So how do I measure that performance?  I don't. 

I prefer to stand by our long reputation, and measure our success by whether or not people have been helped.  Have they learned something?  Have they become better traders, and maybe even better people, for having met us?  Come in and talk to our members. Decide for yourself whether its a good fit for you. That's the only way to really find out.


How long will it take me to learn this?

 

Again, I am going to have to give you an unsatisfying answer and say I don't know.  I have seen people come in, learn the system we teach, take things at face value and start making money within a couple weeks.  I have also seen people struggle for years without ever breaking even. 

Why is that?  I think its because you can know how to do something but still not do be able to do it. Thats the case more often than not with people trading.

Knowing HOW to trade is only 20% of the challenge. The other 80% of the challenge to become successful has more to do with actually DOING it. Only 20% involves learning a method, and that's relatively easy.  The more important 80% involves forcing yourself to follow rules, restraining yourself from doing idiotic things, being disciplined and focused. That is the hard part.

How long does it take to learn to stop being an idiot?  Some children are wise beyond their years, and some people go to their graves without ever learning a thing.  Its up to you. 

 

Why did you write that Letter of Discouragement ?

 

Because I am tired of watching people come in with unrealistic expectations. I am not one to crush anyone's dreams, and I really truly believe you can do anything you set out to do if you want it badly enough.  But if I know that your situation is likely going to doom you to failure in the end, I would rather let you know now. 

Trading is not as easy as it looks.  You have to have a passion for the market, and really enjoy the game of it in order to make money.  Its kind of a weird catch 22.  You have to be able to forget the money, in order make money. You have to be able to emotionally detach from the money, and focus more on simply making "good trades".  If your situation won't allow you to do that, it is going to be very very difficult to succeed.

That's why I first try to drive people away with my Letter of Discouragement. And if that doesn't scare you off.. you might be a trader!

 

Do you recommend any reading?  How do I learn more?

 

This is going to sound like odd advice, but the truth is I wouldn't read too many books if I were you.  It can become so overwhelming, learning about a gazillion useless indicators and all this technical junk, that it bogs you down.  Ever heard of analysis paralysis?  Simple is better, because trading is really more about acting decisively.  A streamlined simple system is going to be a more effective tool. 

I believe that simply observing the market and individual stocks, day after day, taking notes on how they move and what kinds of patterns you see, will be a far better teacher than any book you could ever read. 

 

I work full time. Can I still learn to trade? 

 

We have a lot of members who work full time.  They come in for the first two hours  (9:00 to 11:00 ET), which is really the best time of the entire day, then they leave.  I think thats a good way to go starting out.  That gives you the security of an income, so the pressure of needing money isn't sabotaging your trading.  And it also forces you to leave during the slow unpredictable midday periods, when most people wind up giving back their early gains.

 

I am brand new to trading.  Would I fit in? 

 

We all had to start somewhere!   I know all the terms and stuff probably sound really confusing now, but if you take everything at face value and keep things simple, its probably not as bad as you are thinking.

Just take things slow, ask a lot of questions, and follow our Trading Education Plan.  I would start on a simulator and not risk any real money for about 6 months, while you build up the skills to acheive good averages. When you go "live" the emotional pressure will be a set back. I can promise you that. So you

need a good foundation first. 

 

How do I get the most out of your chat rooms?

 

Like most things in life, the more you put into it, the more you get out of it. The best way to get the most out of the chat room is to ask a lot of questions.  Participate. Post your trades. Make SURE you know what we are talking about, even to the point of coming off obnoxious!  Thats the best way to learn.

People here are really supportive, friendly and helpful. I have never seen anyone berated for asking too many questions, and there are NO stupid questions.  Be real, be open, be honest. 

 

What is the atmosphere like at MTrader ?

 

MTrader.com was the first trading education chat-room on the net, and education remains our focus still today. We have a very long and upstanding reputation in our field. We oppose hype, and stress the importance of making a fewer amount of carefully considered trades, with solid reasoning and potential behind them. We also emphasize and teach proper risk management.


We are very proud of the fact that our room naturally maintains a supportive and friendly, family atmosphere. We are eternally grateful for the wonderful group that congregates here. It consists of many professional traders who are very good at what they do, and also many beginners who are here to start their trading careers off. The mix works though. I can honestly say I have never seen anyone refuse help to a beginner or become irritated by new traders questions. On the contrary, we foster a spirit of community, and the group will most often lend a mentoring and supportive hand to anyone in need.


Are trial members allowed to talk? 

 

Of course!  While you are with us, you will be treated as one of us. We respect and encourage your input and any questions you may have.  We appreciate any exchange of ideas and are always willing to discuss any calls, any action we see, or your own trades with you.  We encourage members and trialers alike to post trades in the room. Whether you are trading several thousand shares, or practicing on paper, your posts are valued as long as you have solid reasoning behind your decisions. The point is to build good habits. Once that is accomplished, the money will take care of itself.

 

Which brokers and quote providers do you use? What about a simulator?

 

First of all, let me say that we have NO official affiliations with any services. No one is giving us any money to recommend anything.  Having said that...

For quotes, we use Realtick. Yes, its expensive. But if you were in a car race against the best in the world, would you try to compete in a volkwagon to save money?  Its important to your success to have the right tools.  You have to be able to see whats going on. Take a few trials.. "test drive" a few.  Ken also uses ETrade for back-up.

We also use Interactive Brokers.  Commissions are cheap and executions fast. I have no complaints. They have a simulator that looks exactly like the real thing.  Its very useful to train, practice and experiment.

Ken has several accounts with different brokers. Other members are also using ETrade, Schwab, and Shoreline among others. Come in and talk to them about the pros and cons. Most people are more than happy to share their experiences. The important thing is that you use a broker who is set up for active traders. Do not try to daytrade with a clumsy slow trading platform. 

 

What is Momentum Trading? 

 

Charts alone do not move stocks. If they did, we could all program our computers to trade for us while we played golf.  Fundamentals alone do not drive stocks, or we would never have any of these outrageous valuations. The central truth is that, behind every stock’s movement are people - people with emotions, and worries, and hopes, and dreams, just like you and me. And that is why the market's movements are not always logical, explainable or foreseeable.

But that doesn't mean they are not playable! And that is what "trading the traders" is all about. It is the art of anticipating and identifying movement created by the masses. It is a choice to play those moves, as they occur, for what they are - simply momentum.


Which methods are used at MTrader? 

 

Our methods are based on common sense and the forces of momentum, using a combination of technical analysis, fundamental analysis and crowd psychology, to anticipate and time direction changes for maximum potential.

Among the variables we consider are price movement, news events, current volume, relative-strength theory, key indicator stocks, recent market patterns, pivot points, moving averages, stochastics, on balance volume, and tape-reading. Our plays are held anywhere from several minutes to several days, and naturally risk management is a top priority.  Read more about our methods in our Education and Resources Center. 

 

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