I find trading to be a good source of extra income but relying on it for my bread and butter, I don't think I have reached there yet. You need to have a special kind of knack for it. But hey never say never!
My own experience is that it's a lot easier to make $ trading when you don't need to because you have a job. And it's a lot easier to like your job when you have enough in you broker account so that you really never need to ever work again if you choose not to. Was a full time trader for 6 years - I always had a few years of living expenses set aside which is strongly recommended for anyone thinking of doing this.
I think he’s talking about downdrift inherent in returns. Businesses don’t have it as they are based on dollarsfrom time period to time period. A dry cleaner makes X +/- epsilon per year. If epsilon is negative one year it doesn’t affect what X will be next year. But in a trading book it does as your dollar risk needs to get smaller.
This would assume that trade management is dictated by balance...which is stupid because the market does not the traders condition. Trade size should be determined by how probable the trade is compared to the other trades. ES
It is. A 50k account should trade half as much size as a 100k. The point is dollar space vs return space.
That is why a lot of people day trade. If you are going to rely on trading for a living, you better have a cushion above your trading capital. I'm retired and get a small pension. Now, getting a few thousands here and there with a windfall profit in between is not such a bad deal. It helps pays the bills and I do not have to pull monies from my retirement funds. Now, if you are really that good of a trader and younger, sky is the limit! Go for it!
Nah, had some good runs but too much praise got me distracted. Would be back at it once I have my emotions not too high or too low, cheers.
Like this... Some trades are placed with lower size...NOT BECAUSE OF BALANCE. I am suggesting a more correct way to look at trade size and trade management as the market does not know the traders balance or condition. It is the merits of the trade set up /method itself regardless of how much buying power the trader has. ES
But all else being equal your trades will be smaller if your account SiZe is smaller. If you lose money your account size will be smaller.
I do not think there is any connection whatsoever to balance if one trades correctly. Es P.S. many trade just one or two ES contracts with 100k...