What does it mean to you to be a trader? Are you a professional or an amateur? This is the foundation of your business or just a favorite thing? How such differences can affect the results?
Professional trader work for a firm (e.g. Goldman Sachs, Credit Suisse) and is a salary position. Professional traders must have a license often refer to as the "series". They have benefits like health/dental care, paid vacations and performance bonuses. In contrast, no such thing as a "amateur trader". The phrase you should be using is retail trader. A retail trader is trading his/her own account and trading from home. Retail traders are not require to have a license although I think retail traders should be require to pass some kind'uv an exam to be able to trade their own account. There's another phrase out there that's popular in Europe of Asia. Its a "private trader". These types of traders use to work for a firm but they decided to quit for whatever reason and trade their own account. They treat their trading like a business and often have a few employees. Most private traders are licensed. Retail traders can trade for a living (only a small percentage make it as such), most are just part-time or have another job, others its just a hobby and to some its just academia. I suspect most ET members are retail traders.
This is a great post. I am now a professional simply because my career in IT Consulting has ended.....mainly due to poor market conditions and H1B visa competition. I'll tell you this, if you can make it trading (i.e. $500+ per diem), it's a great business. No awful commuting, no demanding or political bosses, no nasty co-workers, and the tax treatment is very favorable....relative to W2 contracts. With one of my W2 contracts over the past 3 years, I was living a very meager lifestyle....despite my awesome IT skills and experience. I was working hard, and the agency that represented me was making all of the money. I felt like a slave to the agency. Moreover, when I was offered fulltime employment from the company the agency had contracted with, a healthcare insurance company, I declined because I could not live on the salary they were offering.
I kind of think that...Everyone is a Professional Trader -- or atleast try's to be, eventually Professional to me, means to make money from it -- the more the better An amateur to me, is more of a sleepy long term, heavily diversified investor type of person.
Forex trading can be done professionally if you sped some good time in practicing forex. It is better part time job or hobby you can start with your saving or having extra money in hand. This business will give you an opportunity to grow your investment .
I started as hobby, was in Army, somewhere to go each morning before I worked at a warehouse, kept charting by hand, listening, taking notes. To this day I wished I stayed in stocks than go into futures, seven long years of taking stock profits and over $100k to learn to trade futures. Seven of the greatest years in history till then and lost money overall. Yea, first thirteen years were a full time hobby as I was working full time elsewhere and attending school. Growing up, we all learned to start and manage businesses, so I always saw trading as a business even though to me it was a hobby, when I bit the bullet to learn to program year thirteen is when it became a business fully, now doing something I never wanted to learn-it was like work. Year fifteen turned the corner and became CTA, few years later quit my job. I been Consultant few times for various companies part time, been offered jobs always turning down in Chicago/New York, I can't stand working with people, it is like they want to ask a question and just stare, I SOOOO much want to hurt them. LOL My staff can't stand when I show up, LOL I don't yell at them, I go to my office and scream bloody murder. "What the hell were you thinking". It is a lifestyle if you want to think that. Most might not have understood ETcallhome, but he said it best "The goal of every professional should be to become an amateur. Very few make it that far." Am at stage in my life I am distancing myself from manual trading, reduced hours, use to day trade twenty hours a day and now some days five minutes I made my Goal and walk away. I have a staff, they have the grunt work. I want to go back to hobby of designing systems, let "them" back test and forward test. I never found actual trading to be fun. I just manage risk, so I guess that is a Professional since I know of no hobby that does that. But I do enjoy overall Process. I have worked too hard to just stop.