2 years living expenses, and even then I had to get a part time job working the night shift to pay the bills. Back then unless you had a job which allowed you to sit in front of a computer all day you needed to quit and trade full time. Today with iphones and laptops everybody has a computer all day long, so I would not quit anything until I'm making enough trading.
"I'm about to start a good job; pay is pretty good, but I don't know if I want to work for the rest of my life. I enjoy trading much more, on one I can keep the stable job and live a good life or risk everything including never being able to re-enter the career again to trade full-time. So for those that have done it here are a few questions. How much did you save up before you decided to trade full time? Was it worth it? Do you always fear you might have a series of major losses and become homeless?" I enjoyed reading the stories of so many here. As you can see everyone's story is quite different from one another so is mine. First of all, I really enjoyed reading everyone’s story. Having said that, I'll remind you that people’s opinion is influenced by their own fears, feelings and experiences and not two experiences are identical. You should ALWAYS call your own shots and own the outcome. If you can't, equity trading is definitely NOT for you. That is the first lesson I’ve learned when I started trading for the first time back in March 2012. I have left my job on Christmas of 2013 and doing it "full time" from home; of course, if you can call it full-time. I have no other resources where I receive financial incentives. First, let me state that after 4 years of experience, I am barely able to stand on my feet but with a positive outlook. The last 2 ½ years since I have been trading stocks daily from home has been such an amazing experience despite the fact that there were many struggles and I thought I lost everything even as late as back in mid January 2016 although I ended year 2015 well and started in 2016 much better. Here is my story if you want to continue reading further: I was totally illiterate about stock trading when I started. I had $30K saving (my net worth) in my checking account which I contemplated on either spending to replace my old SUV or put into stock market. Before making a final decision, somehow I figured out to have access to my 401k for the first time after opening 5 years prior to it (that’s how clueless I was back then). I noticed the return of the mutual funds my friend picked for me at the start has particularly gained quite a bit in the recent months. Since I always wanted to get into the stock market in my early 20s, I chose to invest my money in the stock market. I was definitely not aware of way to building a new career, a job or business I could call my own. I was miserable at my job of 10+ years with not much career opportunities. I worked 60+ hours a week as a route-man for a multinational vending company in food and beverages services. I also started (2008) taking online classes as a part time student from a state university (I earned my B.S. in Business summa cum laude in June 2013). Previously, I held an A.S. degree with a major in computer science in the late 90s. I am a hard worker, fast learner and highly motivated when I am passionate about something. On the other hand, I am a big procrastinator. I have the same or similar symptoms like so many of them who get things done when under pressure and time is running out. I can’t concentrate on a single thing. I get bored and lose my focus and interest. I am more alive and interested when too many things are happening simultaneously. I am a self diagnosed ADHD for a very long time. I have had no clue what I wanted to do in life and had no passion for many things and works considering the circumstances I was in until I got into equity trading. I think this job suits me so well. First, I’d like to suggest you should do what I have not done and try to learn as much as you can on trading (rules, strategies, read on the experiences on others, follow the market for a while). Particularly, you should have a good understanding of the macroeconomics and microeconomics, global economy, corporate finance, corporate accounting, world politics, current events around the globe prior to entering into the stock market. I was more familiar with the later part. I had somewhat of an understanding of how the economy worked (whatever I could remember from the microeconomics and macroeconomics classes I took during my A.S. degree). I have also taken accounting, financial management, corporate finance a few other business classes within a year of stock trading in addition to all the college calculus and multiple philosophy classes, which have benefited me in my work greatly to this day. I am also an avid newsreader since my childhood. For instance, when I was a kid, I didn’t have toys but I had a set of encyclopedia on world’s nations through which I had learned so much on 200+nations (capitals and major cities, land size, populations, cultures, languages, economic strengths, and etc.) by creating fictitious games through which I made comparison of these nations. So when there is news about a part of the country or region, I can make connection to those regions a lot easier than many. In the investment world, it is important to estimate the outcome of events to take or strengthen your position. Over the trading years, I have done lots of very costly errors but I was able to manage to survive. I’ve always reanalyzed my decisions and made the necessary adjustment in my strategy. By the way, just like so many, you need to develop your own strategy and be open to adjustments as it is necessary. Otherwise, you may be penalized dearly. It is clear that so many have been a lot more successful than I here but my experience is also different than theirs. Going back to what you capital you should start with, I borrowed $30K from credit cards in addition to my own $30K. I recovered the loss and quickly earned 100% of my own capital (not $60K) within a couple of months only to surrender most of it before the end of the year because I got overconfident and took a lot more risks. So, I started to 2013 fresh. After the first 6 months of trading in 2013, I was up about 300% my own capital investment. I became overconfident once again so I took too much risk and lost half of my gains within a couple of months. I made the necessary adjustments and recovered most of it and ended 2013 with 280% gain. During 2013, I made over $21M trading with $60K of total capital. I did my trades in the company vehicle between my stops in parking lots. I was a part time student, I worked 60+ hours, and I also spent 40+ hours a week on stock trading related activities: screening stocks, reading on stock markets, financial analysis of companies to create a “watchlist” of stocks. I slept less than 4 hours daily on average before I finally left my job. My return for 2014 was 50% over my own capital ($30K saving + $65K net earnings) with a total trading amount of $6M. Remember, 1/3 of the investors have made no money or lost money in 2014. More hedge funds closed down in 2014 than any year since 2000. Average return was 4% for 2014 (I can’t recall the source but I read it on one the major finance websites). I reduced my living expenses at the start of 2015 such as I donated my old car since I did not drive around much, and I cancelled my healthcare insurance that cost me almost $6K in 2014. I also had a 25% return over my investment in 2015 with $6M of trading as well so it put me a little behind in my 2014 capital by the start of 2016. I started really well in 2016 but the trading decisions I made afterwards cost me greatly. I lost roughly 70% of net account value within two weeks. My own capital dropped to less than $30K but I still did have $30K unpaid loan money in my trading account at the time, a total of $60K. I was back to where I started in 2012. I reevaluated my strategy and took some tough decisions, took the losses when my stocks re-bounced a little and invested all in one particular stock that I was “pretty sure” hit the rock bottom. I was right. The stock gained 150% within 2 months but I sold them after 90% gain and then I have hold short and long positions of the same stock and gained another 25% or so. As of today, I made my last payment to credit card loans and currently I have a zero debt with an option of taking out over $50K loan at zero interest for 12-18 months (barrowing money have helped me triple my credit limit in a few years which helps me to have a lower debt ratio most of the time). I have also added 10% into my capital. In other words, my monthly gross gain is about $7K this year from a capital investment of $95K; and as a single person, I can live under $2K very well as long as no emergencies comes up like hospitals etc. I cross my fingers, it continues like this until I build my capital. What is that amount? I realized I definitely need a minimum of $500K or even $1M if I want to have less nightmares and stress, afford health insurance and probably even a car although I don’t really need one. I have to say that every time I think “oh yes, finally, I liquidated all my stocks, recovered my losses and I am in a good position,” things went nose-dive the very next day on. Not for the last a few months since I recovered my major loss from January a couple months ago. I haven’t had a great volatility in my trading account value. Losses have never exceeded $10K but I mostly kept them under $5K, and I hope I have learned a good lesson from the past experiences. I believe I might have made the necessary adjustment in my strategy not to repeat some big mistakes: that is to be very patient and not to assume when the dip is really dip (in a day) or if it can get any higher just because it doesn’t fit the usual lows and highs. When you trade often, you will get caught in that very rare moment when things start working against you no matter what you try. So be patient. The final word: I really love my job very much. I can see myself doing it even when I am very old. I like reading, searching, and learning about economy, analyzing companies (what they do and their finances, corporate culture, competitiveness and etc.). I love having independence: working at the comfort of my home with calm and peace and a great view, having no boss, co-workers, corporate bureaucracy, paper work, phone calls. I like being able to do multitasking: cooking or doing other house or home office related work and doing my job at the same time. I like going to the gym a couple of times a day. I like having a wonderful homemade breakfast while reading and listening to the news every day while sitting in my sweat pants or shorts. I like doing my work at the pool of apartment complex during the week when everyone is out and working in summer. When it is a say that seems like I can’t trade, I like walking to the local shops and grocery stores and stopping for a drink at Starbucks during the day. I like being able to read domestic and international newspapers and watch work, personal development, and fun related videos on YouTube while doing some trades. I like focusing on personal spirituality and making prayers regularly throughout the day. Stress is aside I started living a retirement life in my mid 40s. It happened so quickly I can’t even believe it. I like being my boss and one of the best things I like about my job is to be able to accept some exotic invitations from friends that I couldn’t do before. I have a few close and highly achieved friends with great jobs. They occasionally invite me to travel with them or meet them at where they are visiting for business. They have frequent flier mileage that they can’t spend, and they receive big discounts in 5stars hotels and generous company allowance on dining. I have benefited from them greatly in the past. I have had multiple vacations at beach resorts including in CA and FL. I dined at great restaurants, enjoyed amenities provided for executives in airports and hotels, and flew business class. It cost me a little amount of money. In return I would treat my friends for a day in spa, dinner and drink or buy them a small gift. So take the step whenever you think it is right.
Btw, I'd also like to say that I have been managing a small money of one of my friends I mentioned above. When I took over his account, he'd about $36-38K in November 2013 (down from $120K over the years). His account value grew to $88K+ as of Friday closing. It just takes a lot longer time to build a small account as you know. He has no management fees. He will not pay me anything until his account reaches $150K. Hopefully, we will split 50/50 if he has any gains afterwards. His gross return has been just over $3,300 per month over his starting account value of $69K in 2016. So, if it was my own money, my return would've had been over $10K per month thus far for a capital investment of $165K this year.
I took a break from trading for a few years. I definitely still watched the markets and was very active with my trading journal even though I was not trading. I observed, I learned and when I felt comfortable I started trading again. My starting capital to trade ALMOST full time was around $25K. This was not ALL my trading capital but starting with this much helped me take losses and I was able to stay in trades I would not be able to hold with a starting lower risk capital. I hope to build slowly but surely. If need be I will definitely add more risk capital to my account but that be under my discretion.
i remember listening to story on TV from Barbra Streisand once a young girl , daughter of her friends, approached her asking a similar question you asking us: should she try to become a singer and actress (she enjoyed it so much) or go and have a good job with salaries and guarantees. take a job and never think about lost opportunities in singing and acting, Streisand answered, because it you would really be up to it you would not come heere and ask me those questions... so take a job, man