Over time, every trader will arrive at the point where he appears a bit lonely in trading. We spend many hours in front of the monitors and often only see charts, courses and the order mask of our trading software. The communication is too short with other traders! The resolution is trading in team. Initially, we must clarify what actually trading in team means. It does not necessarily mean that we are opening a joint trading account with other traders and everyone gets a trade authorization. And, that does not mean a sporadic communication n Skype. It is rather a question of a solid group of traders who contest the trading day mostly together.
It does not matter if all physically sit in a room or via Skype, TeamSpeak or otherwise connected. It mostly consists of that you have as trader daily exchanges (conversations) with other active traders. With the discovery of trade setups you can instantly talk to other traders about it or just mention it briefly. This raises the question: What do we gain from this? By searching for setups, we may have overlooked something. For example, a strong resistance in another time frame or a pending publication of figures. On the other hand, the other traders receive an inspiration for a trade which they have not yet discovered.
- Avoid the danger of tunnel vision
- Less loneliness
- Wild gambling is hold down (suppressed)
- Discipline enhancement
- Steep learning curve (learn from others’ mistakes)
- 4-eyed principle
- Danger of distraction (small talks can get you out of control)
- Get persuaded in your own ideas
Experience report of a trading group
A few years after the beginning of his trading career, the author has decided to establish a trading group with a few colleagues. On average, five traders were active in the group and all have made constant gains. Three of traders traded futures and stocks intraday, and only one trader did stock swing trading and one had everything mixed (different assets and timeframes).
Trading-day life in the Trading Group
07:00 until 07:30 clock – Welcoming / Morning Briefing. Alternately, every member briefs the whole group on TeamSpeak about the Europe-Opening. Content of morning meetings: daily summary of recent trading days, present appointments, actual levels of the market and open positions, previously discussed.
12:00 clock – Discussion of ideas
During lunch hour, when the volume slightly decreases and not important numbers are released, the group uses the quiet moments for ideas. This involves everything possible: Ideas for a new fully automated trading system, ideas for medium to long-term trades, new trading tools, interesting articles or useful trading videos.
15:00 to 15:30 – US Opening / US briefing. Again, each trader on a rotating basis has briefed the whole group for the US-Opening. Content of US-briefing: Interesting shares for the day session, which companies give what numbers known and levels in certain stocks.
20:00 to 22:00 – relax after the trade date. Normally, each trader has in this period finished his trading for the current day. Before a trader says goodbye, he sums up his current trades and insights for all along. The trading group gives always priority to the market. For an example, if during the briefing the market was extremely volatile, because in the world something drastically has happened, then the briefing is postponed or omitted. This should really only happen if the market calls. The structures in the trading group are very important and should be respected. Otherwise the group has the risk to become from day to day inactive. Of course there is in between (as in all professions) also some small talk between the members. As long as it does not get out of the hand, it’s a small welcome refreshment in the daily routine in front of the monitors.
Constitution of the trading group
Without a few rules of the game, it does not go further. In trading groups, it is recommended to write a statute about one or two pages. Among other things following points should be noted:
- Daily duty dates
- Confidentiality (trades, account balances and so on remain in the group)
- Meaning and purpose of the community
- Conditions of new entries
Very important, is the definition of the meaning and purpose of the group. All members must agree with it before entering the group. A scalper, who is looking for a trading group to analyze actively with others the market and to trade, is likely not to be comfortable in a group for position traders.
Without technical aid it will be difficult for the team to trade without having them all in one room. So we need the opportunity to talk to all other traders from the team and / or to write, to share files and possibly share the current screen contents. The following tools are particularly helpful:
- Skype (chat and video telephony)
- Teamspeak (talk conference software)
- TeamViever (Screen- enabling)
- Slack (Chat in different rooms)
All tools are free in the basic version. Depending on, package, purpose of application or functions costs can be raised. Divided to the group they are no longer worthy of speech.
Trading groups can be quite useful for newcomers as well as for professional traders. By newcomers, the learning curve often is in the foreground. They want to be surrounded by experienced and profitable traders and want to learn as much as possible and quickly. For experienced traders the cooperation plays a major role. After many years and countless hours in front of the monitor, they crave after (long for) like-minded people. They want to exchange problems, experiences and ideas – and not just two or three times a year at events, but every day. In almost all other professions you sit with colleagues in the office or go on the road together. In addition, if desired, you can have contact with the customers. For traders, there is not all of that. Those who have been long active in the trading world, have certainly already made initial contacts with other traders. Those could perhaps be already the first members of your trading group.
B1) weekly schedule for the briefing
In a weekly schedule can be set, when and who’s turn is with the Briefing and how it will rotate.
Source: Own graph of the author.
B2) Slack chat history from the trading group
Through online chats you can exchange quickly and easily info’s. The picture shows a detail of Slack, a chat with different rooms.
David Warney was employed from 2007 to 2015 as a trader and programmer in a trading firm. There, he developed trading strategies and programmed fully automatic trading systems. At the end of 2015 he founded his own trading company in Berlin. Privately, he has been since 2008 active as a trader on the firstname.lastname@example.org; www.business-trader.de
Article provided by: Traders’ Magazine Italia, www.traders-mag.it