Those words are now a part of your everyday vocabulary.
Welcome to the world of day trading.
When I arrived for my first day of training, as I walked through the office toward the conference room I could hear grown men randomly screaming, “FUUUUUUUCK!” “Damn” “SHIT! (in a tone that resembled that guy yelling, “get those machines back on!” in Trading Places.) I’d hear beating on the walls and then our boss would suddenly jump out of his seat and leave the room. We’d hear his footsteps RUNNING down the hall to stop the trader who was most likely making all of that noise. Then our boss would return, fix his jacket and hair, and then pick right up where he left off like nothing had happened.
That day I knew I’d NEVER want to hear those footsteps coming my way.
Our boss explained that their approach was unconventional. (What else would an engineer be doing in that room-besides fixing a computer?) They were risk takers. They didn’t want to only hire individuals who had finance degrees and finance backgrounds.
The day those hurried foot steps came hurrying toward me…
wait! before I get to that part, let’s give a little bit of background.
Back in 2004 I used to be a day trader.
July 1, 2004 to be exact (I still have my offer letter).
At one point in time I was the only female (except for the secretary) and the only black person. I was NEVER treated like I didn’t belong. If anything, I was exotic. (I was finally one of the cool kids!) People wanted to get to know me and know how I’D arrived!
There are two kinds of day traders: the ones who scream and yell (this was called open outcry) from the trading room floor (that was called the pit) vs the ones who traded on a computer (that was me-electronic trading).
The company I worked for had a seat on the trading floor of the Chicago Board Of Trade (now CME Group) and we all traded from their seat. Some people in the firm were good enough to have their own seat. And if you are wondering, a seat costs according to their website a seat cost $390,000!
What did I trade?
I traded futures contracts. I traded currencies (mostly US Dollar, Euro, Japanese Yin) and crude oil (NYMEX and WTI). I traded the basis spread and the crack spread (terrible name right). I’ll talk strategy in the next post!
The crazy thing about day trading is, you don’t know when you’re going to have a good day or a bad day. But they tell you that if you’re going through something personal-STAY AT HOME!
Got dumped by your lover-stay at home.
You feel fat today-stay at home.
You hate your new haircut-stay at home.
Why is that so important?
Because day trading is a game of psychology. Knowing when it fold em is an understatement! The numbers move quickly so you have to know when you’re right or wrong within 2 seconds and need to make your exit or let your winnings ride.
I was a small player in the market. My lot size was a hundredth of the biggest trader in the office. Your lot is like the number of chips you have to gamble with. You can decide to put 1 lot (or chip) on a trade, or you can put 12 on that trade.
Every day you begin with a fresh slate and you are told to make every trade like your balance is $0.
Day trading is VERY emotional. You get upset when you are wrong and things don’t go your way. (That’s why I heard all of that screaming and yelling on day 1).
And they try to teach you how to day trade.
We had Bloomberg terminals (constant stream of news) and 2 computer screens for trading.
I had a trading coach and sent daily emails. Our coach was there once or twice a week and we met with him 1 on 1.
I had lunch (and attended happy hours) with the other employees
Other companies used to come in and take us to fancy restaurants.
Once a week our firm would buy lunch for the entire office (we would take turns ordering for the office too)
We also had free entry to all of the trading conferences, seminars and other events around the city (hello free stuff).
I worked there for 2 years.
I made a LOT of trades. One year there were 450 million contracts traded (source wikipedia).
And then I was fired.
I hate to do this to ya, but it’s time for a break!
Please stick around for part 2 of this 3 part series where I discuss:
–my ups and downs
–numbers days (the days when economic indicators are announced: Unemployment, Beige book, Home sales. etc)
–my trading coach experience
–my daily emails
–my fall from grace
–what I learned
–how my job affected my thoughts on trading
–what happened to that company
(Click here to read part 2)