So You're Profitable - Now What?

Discussion in 'Professional Trading' started by Lapdance Jockey, Jan 30, 2006.

  1. This is the problem that I think most business and sales people have in general. It's that you're only as good as you're last month. Meaning you have to be consistantly profitable.

    Since this job doesn't offer the ability to really set up any "points of distribution" where does the residual income come from? At what point can you be on cruise control?

    What's the magic number you need to accumulate?

    I realize that everyone has a different version of how much it would take to make them "comfortable" - but my question is more along the lines of which investments can you keep putting alittle or alot of money into where you can just let them be and collect every month?

    And I'm not talking about an IRA. I mean something that you wont be depleting from.

    Maybe I didn't articulate this thought well enough but I look forward to comments.


    Much appreciated

  2. I guess you're referring to stocks that pay out dividends.. assuming you're on the long side.
  3. no - see - again - maybe i didnt articulate it

    whats scary is that no one has really responded to this

    maybe i should used an example.

    in normal business you set up systems or points of distribution so that at some point you can step back b/c the network you have created functions by itself.

    or you come up with a razor blade - case in point you invent the shaver and then you make residual money off the razore blades for the rest of your life.

    where do you get to the point where you can step back and just chill. where do you get to the point where you dont have to rely on your last month in order to eat tomorrow?

    what is the razor blade
  4. Oh.. looks like what you're looking for is an automated intraday trading system.

    Where you automatically take money out of the market each day through your network connection.
  5. B5476


    I don't think that there is an end game here other than accumulating sufficient dinero that you can live off dividends/interest. This is the classic conundrum of extremely well paid professionals; you gotta keep performing at a high level in order to keep the income stream flowing.
  6. I assume your goals involve reaching a point at which your retained profit's critical mass provides sufficient income to maintain your chosen lifestyle. At this point (and beyond), you no longer require profits from trading. Numerous methods exist for insuring your profits compound. Many traders simply maintain a high equity balance with respect to their lot size traded in order to take advantage of interest rates (not necessarily the most advantageous choice). Some rotate a percentage of their profits into hard assets (precious metals, real estate, etc.) Others, place a percentage of their profits into high yield (or inflation adjusted) bonds or dividend producing equities. Additional solutions exist as well. Just as in trading, an appropriate risk / reward analysis should take into account your current lifestyle needs and long term financial goals.

    In order to determine which solution for asset protection best meets an individual's needs, one must first answer an often difficult question. How much is enough?

    Good trading to you.

    - Spydertrader
  7. My goal is to make enough from the markets so that I can close all my trading accounts, pay my taxes, set up a conventional, diversified investment portfolio and live off the proceeds. It should be large enough so that I can take the cream off the top - say 3.5% pa - and live comfortably off that, while the portfolio still keeps pace with cost of living increases.

    At that point, I will decide whether or nor I want to continue trading, or move on to new pastures in life.

    I would assume a lot of people around here have a similar goal of financial

  8. Trading is really more like self-employment than investment. Self-employment you have to be there every day, make the trades. Investment though, the investment grows and produces income over time.

    So I look at trading as the journey, rather than a destination. I happen to like the journey, so I get up every day and trade.

    But years ago, as I have said here before, I started putting money into small rental properties, which produce income, and over the years have gone up in value, as has their income.

    I believe you could do the same thing in the stock and bond markets, but it takes talents completely different than trading. T-Bills these days return just over 4%. $3mm would give you income of $120K per year without touching the principle at todays rate.

  9. 1 milllliooooooooooooonnnn dollllarrssss