Comments on: I want to become a floor trader! How do I become one? (CBOT, NYSE, CME, NYMEX)

By: nadlique

nadlique — Thu, 11 Sep 2008 06:58:02 +0000

Indeed Jimbo.

Come to think of it, even through electronic trading, I get stressed out and frustrated. Imagine if it was in the pit. I’d get mental.

By: Jimbo

Jimbo — Wed, 10 Sep 2008 21:11:19 +0000

Listen….I was very lucky and spent the first 5 years of my career as a floor trader in New York on the NYMEX and NYBOT exchanges. The money was great and it was exciting but like the other guy said there was a heavy price to be paid in other areas of your life. Even the ‘toughest” and “craziest” traders were usually in private very stressed and unhappy people who had gained addictions and medical issues along with their money. I can be a very exciting place to start, but the speed it takes to completely burnout is amazingly fast. I actually kind of find a movie like “floored” to be annoying in trying to romanticize what was really a big daily street fight that ended all too badly both financially and health-wise for most people who took part in it…..stick to the electronic stuff, its not easy by any stretch either but you’ll have your sanity along with your profits.

By: Jerry

Jerry — Wed, 13 Aug 2008 17:00:26 +0000

Nadlique:

Well, after 21 years, yes, I ended up with a lot of money — enough to retire on, at age 45. But I can’t even begin to tell you how many losses — huge losses — I suffered along the way. That’s par for the course, on the floor. After my first 6 months, I’d lost about 70% of my trading capital. I was able to pay my rent only by working as a dishwasher, at night.

But I learned a lot from the veteran traders, and the most important thing I learned is how to lose, moreover, how to LOVE losing. I know it sounds weird and goes against the “winner” mentality we worship, but it worked for me. You learn very little from winning. Indeed, a streak of lucky wins will do nothing but reinforce bad habits that will eventually break you.

Floor trading, as you probably realize, is a dying enterprise. For good and ill, the pits and the rings are going electronic and will never go back to open outcry.

If you’re bound and determined to experience the floor, I’d look into maybe leasing a seat on the Kansas City Board of Trade or the Minneapolis Grain Exchange — the two exchanges with “affordable” seat prices. You might be able to arrange a short-term lease with a member, so you can get a taste of what the floor is like. Also, these exchanges are small and not nearly as lethal as the Chicago and New York exchanges.

If I were you, though, I’d stick to perfecting an electronic system. Making money is what counts, and you can make much more of it, a lot easier, that way than on the floor.

Good luck to you!

By: nadlique

nadlique — Sat, 09 Aug 2008 01:04:16 +0000

Hi Jerry,

I have heard numerous stories as well about how ruthless and how aggressive people can be in the pits.

Of course, in my case, I think, being a pit trader will only remain a fantasy. I do want to, but practicality wise, I’ll stick to electronic trading.

Anyway, in your case, did you manage to make any considerable amount of wealth in the pits? ;)

By: Jerry

Jerry — Fri, 08 Aug 2008 18:15:52 +0000

Nadlique, you seem like an intelligent person, so take some friendly advice: do not attempt to become a floor trader. I traded coffee at the old CSCE and NYBOT for 21 years. Of the traders who were in the coffee ring when I started, only about 5% were still there 5 years later. Floor trading is no game, and it’s not a movie. It’s a daily street fight. Guys like me survived as long as we did by beating the living shit out of 20-something-year-old guys who made it into the ring, thinking that it would be cool and sexy and a rocket ride to wealth, only to find themselves, within 6 months, literally penniless. And we paid a heavy price ourselves — ulcers, heart attacks, depression, addiction. I walked away from that hell 8 years ago and have never looked back. I took what I learned with me, and I’ve been trading electronically, living well and enjoying life. Take it from me: leave floor trading to those with a death wish.

By: nadlique

nadlique — Thu, 08 May 2008 00:12:00 +0000

I just love the energy that these guys emit. Not to mention, the fast pace environment.

I especially love the second video clip, the one from the movie Trading Places. Amazing! Hehe.

Also, if you watch the third video (The movie FLOORED), the trader had stated that there are people who got punched on the pits (the exchange floor). Haha. These money hungry bastards :)

By: Jean

Jean — Wed, 07 May 2008 15:36:04 +0000

You are ambitious. Watching these clips are stressful enough for me…

GOOD LUCK TO YOU! :D