This is extremely scary. The truth, no matter how painful it is, is that most retail traders are undercapitalized. Even in the remote chance that they might actually be good and have a valid edge, it's next to impossible to make a living on $10K account or even on a $25K. I'm not saying it's not possible, but it's extremely extremely tough. So, the sad state of affairs is that a lot of this biz is about selling a dream. Even in the example where the guy is making $25K out of a $25K account. That's a 100% return. But $25K is not even a living (especially after taxes and depending where what city you live in). oh well. misc
Personally I would not trade for 50K /year. There comes a time where you have to start thinking about your future ie kids, family, lifestyle etc. If you got what it takes then great, otherwise you have to know when to walk away. There are a lot of other ways to make money. Trading as an occupation is overated unless you make 300K+ then its great, if not then its best to stick to your day job. ozzy
..well .. not too many day jobs pay 300K a year ... ... and those that do may be more interesting than trading ......
One potential flaw I see in these numbers is they only count mark to market, ie. retail traders. Prop traders do not have to file a mark to mark declaration since they are in an LLC (I believe). FYI, I trade retail M2M, but file my own returns based on Green's tax guides. So I'm not trumpeting the virtues of trading prop.
I used to make 75K+. I would have become a manager => director in the future. So I'm guessing around 100k+ in 3-4 years and then up from there. I have some friends who are electrical engineers whom I went to school with (who are on the same level as me) who make 100K+ already (around 28-29 yrs old). ozz P.S if you want to make money engineering is not the place to be IMO. P.P.S There's a lot of money in the markets. 300K /year is not a lot in my opinion if your on top of your game.
I think there are only a few instances for the off-the-floor individual trading his own account where trading-as-income is in the end a "worthwhile" endeavor -- meaning, where one's edge as a trader cannot be leveraged or compounded and yet still provides a dependable living. The real question for those in this situation is: how long can that edge last? When the nature of your edge cannot provide a compounding profit model, the clock ticks down much faster as market conditions shift. That given, I think the basis to longevity in trading are adaptability and compounding, both of which should be given huge weight when one considers which markets, time frame, and methodology to pursue.
$300k divided by 52weeks=$5769 week. One good up day in the market and doing 4 positions, each position 2000 shares, and each position yielding 1/2 point=$4000. With the right capital you can do more than four positions. Use tight stops for those that do not follow through, and let the winners do their .30c, .40c and 1/2 points. If you know how stocks trade and have the bigger capital and the right software to do this, you can do $300kyr. And most weeks the market will give at least two decent days to the upside.