Monday, May 25, 2009

Fighting the Isolation of Trading

A reader poses an excellent question:

What ideas do you have to help traders fight the isolation of trading alone with few outside contacts to discuss this style of making money? Most people are not very interested in discussing. Twitter is okay for news, but to share ideas it is just so so.

I addressed an important aspect of this issue in my post on virtual trading groups a while back; I also tackle this topic in the Trading Coach book. There is no question in my mind that, if I were to start trading full-time--knowing what I know now--I would either join a proprietary trading firm or would form my own "virtual trading group" by connecting online (and in real time) with a handful of like-minded traders.

Frankly, there is no guarantee that joining a prop firm will provide access to fresh perspectives and ideas, but at the good ones, the guys are always talking shop and you can pick up good stuff. My experience is that when you're prepared to give, you're likely to get. I often begin my interactions at prop firms that I work with by sharing my own ideas. It's surprising how often that leads to mutual brainstorming and exchange.

I know from my interactions with readers that there are many who are interested in mutual learning. Indeed, that is why many people responded favorably to my idea of a Chicago summer seminar in which the only "registration fee" was to bring one good, unique trading idea. My hope is that an event such as this could lead to further networking, from which could spring virtual trading groups.

Hint: Check out the most frequent participants in the comments sections of your favorite blogs and online forums. Many times, these will be the individuals most interested in networking and sharing ideas.


JDMoodie said...

I tried starting an active trading group around here to get some trading ideas going. It is tough to find people interested in trading, tougher to find people who are passionate about it...I still come up blank as most are only interested if it is an easy money venture.

Being my own idea man is fun, challenging and rewarding but it does feel like trading in a vacuum.


Trader Steve said...

Early in my trading journey, it was highly recommended that I establish or join a network of traders.

On a daily basis, I have a group of like minded ES traders who have a private chat room where we share set-ups, chart observations and trade entry and exit strategies.

Not only has this helped minimize the isolation factor, it enhances our trading abilities as well as providing a level of accountability.

As you recommended Brett, I have found it very helpful to search for blogs and Twitter members who trade similar markets or who provide a discipline or growth opportunity (psych, journals, rules, etc.). This has helped me tremendously.

Another good resource is StockTwits where a trader can connect with Index and/or stock specific traders. By using their filters, a trader can watch just those "tweets" from other traders who are commenting about and trading only the ES (or any specific E-Mini, stock, currency, etc).

I've found Stocktwits to be a great vehicle to see how others are interpreting the ES as well as an opportunity to participate and reach out to other like minded traders. Not only does it help to establish or expand one's trading network, it also helps minimize trader isolation.

Vic said...


I'm game to try and start a group. Warning, I am a newbie in the daytrading/options but have been in the markets for the better part of 10 years so I'm well versed with market data/charts etc...oh yeah, I am passionate about this too.

I'm at if you're interested.


ChiTown said...

I trade full time at my home office, primarily options/spreads, focused on selling volatility with the occassional stock or currency pair. I am interested in moving to futures (YM) to minimize event risk and the number of products on which I focus. I consider my profitability low and improving.

A virtual trading group sounds great, but what do the experienced traders get out of it? I am happy with one online chat whose moderator also sells tapes & seminars and a second whose moderator is sponsored by a brokerage. It's an interesting experience as over time, one feels they know their virtual colleagues.

I wonder if I am better off joining a prop trading firm in Chicago. Isn't regular human contact better for one's psyche? I have hestitated thus far as I don't know why experienced traders stay at these firms and need criteria or referrals who can reference potential firms.

ryan said...

Starting a blog is a great way to sort out your own ideas, connect with other traders, and expand your skills--among other things. I've met quite a handful of traders who I enjoy talking with. I'd say it's definitely worth it and probably easier than trying to find traders in your geographical area.

DJ said...

Hi Dr. Brett,

I am one of those "isolated" new trader that I don't know anyone. I learned trading by myself without any seminar (too expensive for me). What I do is that I just keep on reading blogs, especially yours, to keep me "connected" and to learn more ideas from other trader bloggers. In that way I don't feel isolated!

meques said...

should agree with @Trader Steve, being also es trader, was real godsend for me.

zircon-212 said...

Are there any others on the opposite end of the spectrum that enjoy the advantages and focus that isolation provides? I feel that misery loves company and unless you have developed a strict discipline with your stops and money management a collection of traders opens up a dangerous game of defending losing positions to the death. Junior guys look to the more experienced when wrong sided market positions cause the Bob(as in I 'hope' the market turns soon) in combination with sweaty palms and brow. Most likely the seasoned trader has a larger risk profile and looking to him to assure you that holding the position (fill in the blank for the justification) can be deadly to your P + L. I acknowledge that sitting with trading peers and sharing ideas has its benefits. I also personally think if the money at risk is your own or you are getting a cut based on your profits the trading by committee is extremely dangerous.

meques said...

indeed it depends on the person, on yourself. one will feel comfortable himself while trading alone, another will enjoy trading with peers. im trying to find golden mean.

Joe said...

I have to agree with you that trading full time on your own can leave you feeling isolated. Not to mention the fact that you really can't talk to anyone about it unless they are at the same level as you are or preferably better(kind of like a lot of sports-you want to play with someone you can learn from and improve). The positives however really out number the negatives. If you are a people person this is not the occupation to choose. I think that an independant trader can get a boost by going to seminars and gatherings such as the one you mentioned you want to initiate, but in the end a trader has to stay motivated on their own. I have been trading full time now for about five years and the only communication I have with would-be traders are people at parties asking me for hot tips which I have never given, so I know where your coming from. Thanks for your post and I wish you luck with your trading idea sharing plans.

DreamJOBZ said...

Dear Brett, G'day Again,

All your post really motivates and confirms me that I am going in a right direction.

Firstly, regarding the prop firms, but do they really have any systematic rule based trading? I would choose if I start with what I know is, gather a group of trader thru Forum or bloggings. But directing them in one direction takes lots of teachability & humbleness.

Secondly, regarding Isolation, I am never alone when I am trading. There are about atleast 15+ traders with me to discuss with prior to entering the market. Yes, I agree it gives enormous confidence in leading & elevating them together. I love to share & grow together, please keep in touch with me if you like to share Raj.DreamJOBZ@gMail.Com

I like all your postings, thanks again for sharing & guiding.

God bless you with more happiness, health & wealth.

Be Awesome,
Raj, DreamJOBZ

J Srinivasan said...

Hi Dr. Brett,

I'm completely enrolled in the idea of forming a "Team" even if it's virtual.

I've tried but have miserably failed to this here in India.

Are there any traders you may know from your vast following that are interested in the Indian stock markets and are similarly looking for "company"?

I'm amused and quite like the idea expressed by your follower of a "Trading dating" service!

God Bless.
Bangalore, India