A switch: from part time trading to full time trading
A question to full time traders: how did your trading results change, when you switched (if you did) from part time trading to full time trading?
The thing is, I am not able to trade actively while working, and I'm working during London session and NY sessions (most of it), and often when I come back home the market becomes quiet and calm. I feel like I trade better in busy hours, so I am considering trying it out.
I know what I would be getting in to > no guaranteed or consistent income, stress, etc. But hell, if not now, when? Sadly, I'm not the biggest fan of my current job.
I'm interested in hearing your stories, maybe it'll give some inspiration or will be a reality kick.
Looking back I can say that I only really learnt to trade after doing it full time. I thought I knew what I was doing but there is a big difference between theory and practice.
Why not take a week off work and see if you can make money every day.
Anyone who is a full time day trader should really be profitable 70-80% of days.
First off, you want to make sure you are experienced enough. How long have you been trading? A few weeks, a few months? Before going full-time, I'd recommend having a few years under your belt. Second, you should have consistent profits. A successful trader is one who can profit consistently, regardless of market conditions. If your account statement goes up and down depending on how the wind is blowing that morning, then you need more practice before going full-time. Third, do you have a sizable amount of money in your savings in case things go sour? As in, if you blow your trading account, will you have enough to eat that week? That month? Will your house foreclose and leave you out on the streets? Fourth, do you practice proper risk management? Or will you gamble away your life savings? (Yes, when you're risking your life savings/house/car/etc. trading becomes gambling.) Fifth, do you love trading? Or do you just do it for the money? If it's the latter, then I wouldn't recommend making it your full-time profession. Daytrading isn't exactly a cakewalk. It may be more thrilling than your current job, but it's certainly not easy. If you don't truly love trading, you'll end up hating it worse than your current job. In that case, you may just want to seek other employment (perhaps with different hours), and continue to trade part time.
Lastly, do you have something to fall back on, or did you get your job fresh out of high school and work your way up the ladder? Do you have a degree? A large inheritance? Could you get your old job back? What would you do if trading isn't working out for you? Could you find a job while your life savings dwindle away?
I'm not suggesting trading full-time is a bad idea, there are just a few things you ought to consider before making such a radical change in your life. Especially to a profession with no guaranteed income.
Thanks for the input.
I have been profitable, although still have some issues (psychological mostly). I think I could solve those pretty quickly if I would focus on trading only.
I love trading and everything about it, I am ready to sacrifice a lot to succeed.
To keep my mind calm and clear, I still would like to save some money, to live off half a year.
Anyway, it's a decision for me to make, but if anyone else wants to share, you're welcome.
I think the first thing you need to consider is how much You are expecting to make from trading, and You need to be very realistic about it.
I once tried going fulltime a few years ago and it didn't work for me. After that experience, I would not go live today unless I know I can pull at least the double of what I make with my current job. Also, I would recommend anyone who is thinking of going live to think about this: Do you have an edge? Do You know for a fact that your strategy is profitable? Do You know how and why it works? I know this sounds obvious but some people go fulltime without knowing those things, I know because I did it!
Anyway, if You are young and You can get your job back or get another one (are You sure about this?) in case things don't work as You expected then why not try, You'll learn a lot.
Best of luck with you decision, whatever it is.
According to what you say you have not been able to trade actively while working. This can create a false impression that doing full time you may be able to leverage on the opportunities available.
Before you proceed full time. Write a business plan.
Think of all the possibilities and risk of doing this.
What are your goals for doing this.
What are the milestones required to track your progress.
What is your stoploss for trying full time.
If you have a wife or girlfriend that you intend to marry, make sure you have their support and commitment.
Are you well capitalised? Dont go in with a few thousand dollars and expect to make ten thousand a month.
How you intend to approach trading everyday.
Do you have a news feed to keep track of key events.
What are the activities you going to take to release stress.
What are the activities you need to do to fill the social aspect of your life.
Remember full time trading has no one around you and can be very lonely.
Is this the life you want?
Have you practiced your approach so that you can do it in and out everyday without being psychologically destroyed.
How many pairs you intend to trade? Do you understand the risk involve when trading multiple pairs on an intra-day basis?
You going to trade pure intra-day or swing some?
Can you explain your edge CLEARLY to another fellow trader? If you cant, you are not ready.
Find a trading buddy. When things get tough, you can find support.
I hope you understand the psychological issues are the hardest aspect to solve in trading.
You need to do everything to reduce failure rate.
Keeping your mind and lifestyle healthy is the most important aspect.
If you are doing in for money, Swing trading can also be very profitable.
Depending on how ready you are, day trading can be more profitable or less profitable.
All the best.
Let me start by saying I still work full time. I did however seek out a job that allows me access to my laptop during London and NY sessions. I am not supervised at work and as long as I complete the job noone cares what I do.
1) Can you live for a couple of months with no income from trading. You need funds to pay bills separate from your trading account.
2) Are you disciplined. This is very important. My trading methods when combined produce only about three trades a day. Some days may be no trade days. Do you have the discipline when trading full time to watch the market all day and not take a trade if no good setups happen?
3) How many trades have you made for which you have true statistics. Do you know your profit factor. What is your edge in percentage terms? You need to know these things for position sizing. If you size too big you can kill your account and too small you leave money on the table. I recommend Van tharp's books for these if you don't know them.
I feel that a job allows me the freedom to lever up a little bit more and compound a little faster. I don't have to pull funds from my account to live and my wife is happier that I still work. If you are single, have no debt, and have funds to live off and are young give it a try, if nothing else you will learn who you really are.
I was self employed for years and trading is no different. You will have good days and bad. You need discipline to save for expenses, build your account and take a little for income too.
Good luck whatever you decide.
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