Been a bit confused by various articles and postings and would appreciate some comments from veterans. Many traders encourage newbies not to go in full time trading cause the pressure of making money to pay bills affect trading performance. They advised newbies to hold on to a job or some other income while mastering trading. However there are some experts who refer part time traders to "seeking success as a surgeon or professional basketball player or musician by pursuing your work part time" where is the fine line drawn? appreciate any comments
When I first started my full time trading career, I began my efforts with a $30,000 USD account. After realizing better than moderate success, I discovered the account size wasn't large enough to maintain my lifestyle AND grow my trading account. At this point, I had two choices: improve my success rate or increase my trading capital. Since undercapitalization remains one of the biggest mistakes new traders make, I decided going back to work would increase the likelihood of my long term success. As a result, I took on a contract position for one year - allowing me to maintain my lifestyle and increase my account size. I deposited a significant portion of my paycheck into my trading account, and continued to trade using EOD charts and phoning my orders into my broker. I also continued to educate myself on a daily basis. After trading 'part time' using EOD charts, and adding additional funding to my account each paycheck, I left work for the second time one year later, and have traded full time ever since. Now, in order to accomplish my goal, I had to be highly organized. I needed to configure my computer to send me an alert via mobile phone. I had to have an excellent relationship with my broker. I also had a limited amount of time to spend on research and set ups each evening. If I did not accomplish everything required to trade the following day, I didn't trade the following day. Maintaining a balance between my then current job, my education and transition toward what I hoped would be my future career, friends, family and 'down time' (vacations, NASCAR Races, and just plain living a full life) required a high level of organization and the ability to maintain focus on a multitude of tasks simultaneously. Not all that unlike trading full time. Maintaining a healthy and well balanced lifestyle and understanding the limits of time and human endurance were the keys to my success. I look back now and realize just how arduous the journey was, but at the time, I don't recall ever thinking about how hard I worked to achieve my goals. If you have a passion for trading, and I mean a REAL passion - not just words on a page, then you too will find a way to achieve your goals. Prepare yourself the best you can, educate yourself to the fullest, and grow the trading account to sufficient size to avoid the pitfalls of undercapitalization. My journey to full time trader status required three years. Some have traveled their journey faster, while others took longer to reach their goals. The one thing we ALL have in common: the market was here when we arrived - no matter how long it took us to get here. Best of luck to you. - Spydertrader
Howdy, I'm a part timer and a newbie . So far I'm very happy with my decision. First of all, there's very little pressure, as I know my bills will be paid with the income from the primary job. Second, it allows me to learn the business at my own leisurely pace. In my opinion, to be successful trading part time: 1) One needs dedication, discipline and true affection for trading. 2) One must be able to trade full day, at least 2 to 3 days out of the week (which I do). Glancing at the market on the screen periodically while the boss is away will lead you to DISASTER! Hope it helps.
My line of thinking is that the next year or two of University for me will give me the opportunity to trade part-time. Once school is finished, I will likely continue to work part-time at the very least, or possibly seek a full-time job that would allow me the flexibility to trade for at least a portion of my day. The latter is somewhat realistic because I live in the MST timezone, gives me a two hour buffer compared to EST trading hours.
thanks for sharing your experiences! Im in similar position is that 1.5yr back i quit my job to learn to trade forex but went back part time( half a day work) after 3 mths after realising that it's going to take me longer to be able to trade successfully and I could od with from fix income to pay bills. Luckily for me is that im very risk averse in such that over the time im learning, i didnt trade large nor lose more than $50. after 1.5yr of researching and testing, i have established a trading strategy which Im trading very small amount of real money and which i do not need to be in front of my pc all the time. I think my issue is that even if i have the capital as well as a sound methodology, im not sure whether i can perform if i trade full time without any safety net cause I afriad it will make be scrutise my losses excessively and fail to take trades becos of fear. i understand that loss of part of the business and we have to be discipline to take every signal but at this moment I feel that I might be able to trade better ( following every signal with reasonable size and not extra mini small position) if I hv a full time job. Any advises for working on this psychological issue from traders who successfully switch from being part time to full time?
Don't listen to that propaganda. That's what commission-hungry brokers and prop firms want you to do - throw all your money to them. It's an exponential game. It takes the same amount of time and effort to go from $1K to $10K as to go from $10K to $100K. If your strategy works, you will eventually compound your way to the riches. If it doesn't, no matter how much money you put into your account, it will end at $0.00.
His problem is precisely that he cannot compound exponentially. Even if he realizes a performance of 15%/month, That would leave him with a 4500$/month gain. From that gain, he has to pay taxes and living expenses, leaving perhaps 450$/month, which would be a meager 1.5%/month, not exactly the way to the riches !
I use neither a commission hungry broker, nor have I ever worked at a prop firm. The decision I made to grow the initial account size resulted from my own observations - not from the advice of others. Propaganda played no role. As sciencetrader accurately describes, my living expenses and taxes left very little remaining profit to "grow" my account. As a result, I could not take take full advantage of compounding. The journey from then to now, also had the added benefit of allowing me the time to better educate myself - further enhancing the likelihood for success. Could I have chosen a different solution? Of course, and my solution, although successful for me, may not be the best solution for the next guy / gal. A number of solutions allow the new trader to transition from part time to full time status. The decision on which solution to implement remains a matter of individual assessment. - Spydertrader
Well said. I guess Im doing the reverse by thinking of going back to full time work while still trading. im not a scalper maybe tat's why i do not need to be in front of my computer all the time. Moreover I find it very boring to just wait and wait with nothing to do while at home. jus curious, what do full time traders at home do while waiting for signal to close or open positions?
I spend time researching in an attempt to improve my trading, I post to my journal , and lately, I am learning Wealth Lab code to test and develop additional systems. Although macroeconomic forces don't play a major role in my trading style, I also try to keep an eye on the geopolitical or economic events that might influence the market one way or another. - Spydertrader