But i have some big questions: - this means my trading account will not grow as quickly? - i have lots of commitments kids houses car, so this is definitely no no? - i hate my current job... Any advice?
I trade from work because eventhough I'm consistent in my trading those monthly responsibilities get in the way of raising trading capital. Make sure you have adequate capital before you commit to such decision. Being profitable is only part of the winning formula. My two cents and good luck to you. NAD
If you can compound fast, then it is worth going full time. 400% in years 1 and 2 after going full time = 25 times starting balance. Ofcourse you wont be able to keep up 400% for ever, only in the early years. If you only going to make max 100% a year, then unless you got in the region of 250K, you wont be able to beat your living costs by a large margin and it will be too much stress. I dont know how much you got, but 100K would not enough if all you can make is 100% a year.
Thanks for replying, so to earn 250k, work out to be 20k per month profit, I think my performance only avg 10k per month, you are right, if 20k per month profit, it will be better even after monthly expense which for my case, monthly expense is 6k. But on the other hand, increasing profit and sizing from 10k to 20k takes some effort, time, guts, capital, luck, market to reach So it is bull market ending soon, that's why question like mine of going full-time start popping out in forum?
If you're averaging 10K a month, why exactly does it require effort, time, guts, and luck to increase your profit to 20K a month? If your account's too small to double the size of whatever you're trading, then the "capital" part of the equation makes sense. But how do effort, time, guts and luck play a part in this? The effort and time are exactly the same (you double the amount in quantity field and trade exactly the way you've been trading). The guts are the same (you're trading successfully, so you continue to do what you're doing with double the size in your quantity field). "Luck" is a meaningless term combined with a qualifier ("good" or "bad") to describe an individual's or group's outcome after the fact. The concept of "luck" serves no useful function, especially in trading.
ok, my performance only recently improved from 5k per month to 10k per month. 5k per month lasted for 1 year+++ (2008 to 2009, 2010), before it got into 10k per month, which lasted only the last 5 months (Aug till now). I'm not sure whether is it because of the recent bull market or wat, but 1 thing i did is that i increase my sizing, and did some fine tuning to my day trading. And increasing of size increases the bet, you tend to take your profit earlier or cut loss later, stake is higher, and your nervousness increases , so require some guts Time is because i thought i may need some time to stable down to get used to the sizing mentally before i increase it further? so require some effort to do But anyway, i do have some loss days of a few thousands, and that flash crash incident (May last year) still fresh in my head But my job is really stagnant and not going anywhere, but i deserve this, because i have spent so much time and effort on trading, so day job still remain in low level position, so dragging my feet to work everyday... I traded only the morning session, after that go to work. So basically i'm working from 8am to 2am, having only 5.5 hours sleep everyday, except weekend, demn tired
Perhaps the more appropriate question is can you survive a 2 year drawdown with no other source of income, and still be around with enough capital when your strategies bounce back? The thing with trading is your capital is the only growth engine. It isn't like a high barrier to entry business where you pay off a building, or factory machines, or you have a structural advantage, and thus you can generate better returns with less capital outlay in the future. It is very difficult in trading to put up high barriers to entry and thus improve your margins and thus do more with less capital. I would suggest a rule of thumb of either in a year you expect to make 5x your current salary, or your lifestyle is such that you can live for years off of principal and still come back and run your money and make reasonable returns and barely even be effected by your living expenses. I know a surgeon making near 7 figures who has a negative net worth and is probably living near paycheck to paycheck. Everything is relative.
If increasing size causes you to take profits earlier, cut losses later, or become nervous while trading, then you don't have specific rules for entering, managing and exiting trades. I'm going to venture a guess that you sometimes average down when a position runs against you, or you don't use protective stops, or if you do use them, you sometimes move them farther away if a position runs against you.
The above seems so right, how do you know But avg down is a devil which i dare not touch, it means adding to your mistake, i have numerous cases of using avg down which sometimes turn out to be huge huge losses, so have stopped using it.