The secret ingredient if you want to become a full time trader – what nobody talks about | Forex Factory

The secret ingredient if you want to become a full time trader – what nobody talks about | Forex Factory

The secret ingredient if you want to become a full time trader – what nobody talks about

From tradeciety.com

Looking back, I now realize that what allowed me to finally become a full-time trader was not a better trading strategy or a different method, but something I never expected when I started out as a trader. In today’s society where the average attention span has dropped to 8 seconds, where 140 character tweets seem too long (#TLDR) and people skip YouTube videos after just a few seconds, we easily lose the connection to ourselves… The concept of “self-awareness” has a woo woo ring to it and most traders will not listen to you if you start a trading conversation by referring to self-awareness. However, if you ... (full story)

Comments / Top
Subscribe

Apr 5, 2016 1:23am

What a discussion

And the moneyflow chap just made it stupid with his numbers. Who cares when u withdraw money??? . Here is what matters : trade well, pay attention to market, read what smart people post. Close at night.... A semi-smart man can make 7 to 10 % a month easy. Or more with risk. That's it.

1

Apr 4, 2016 11:09am

^^Indeed. Everything is relative, but I have argued in this forum that a normal adult (with a mortgage, a family, etc) US trader needs to be trading a min of ~$150k liquid equity just to make a living. And the more the better. I would not personally quit my day job unless I had about $250k to trade.

Apr 4, 2016 10:29pm

The point of the article is SELF AWARENESS. The more money one has to trade means they have more to lose if they are not SELF AWARE.

The article describes most of the traders on the forums. You can see how many indicators they cram on their charts to the point you can't see a price bar clearly. You see traders flocking from one thread to another in search of the Holy Grail. You see them flaming each other. Sheer madness!

How many readers have taken the steps the author listed?

Apr 5, 2016 10:34pm

Quoting Mingary

Disliked

The only Self Awareness to cultivate is the realization that a trading fund of 1,000 or 500,000 makes no difference. Anyone can be a full time professional forex trader until all the money runs out. Then it's time to get a real job.

Ignored

Hmmm, how about leverage considerations. A large account can afford to be conservative, no?

Apr 5, 2016 10:49pm

Quoting Mingary

Disliked

True.
Yet, this is true also:

Proper leverage consideration only means it takes longer to lose all the account.

Ignored

Not if you ever in this life come to understand PA, risk, and position sizing.

Apr 6, 2016 2:58am

Quoting Guest

Disliked

To become a full time trader you need to a) know market dynamics enough to turn $1000 to $10,000 b) confirm that feat by hitting $50,000 from that second base. Once you have reached "b" you are a world class pro that can rightly c) trade for a living and d) are morally qualified to trade other peoples monies. Anything short of these points made (in my view) is nonsense. Mark you there is a basis for the numbers but those are too long to restate here.

The Crow (-_-)

Ignored

Turning 1k to 50k doesn't mean your a world class trader.

Apr 4, 2016 11:40am

Quoting The Fool

Disliked

^^Indeed. Everything is relative, but I have argued in this forum that a normal adult (with a mortgage, a family, etc) US trader needs to be trading a min of ~$150k liquid equity just to make a living. And the more the better. I would not personally quit my day job unless I had about $250k to trade.

Ignored

Agreed 100%. I mentioned those exact numbers once to Mr. Hatch, whom being in rural Germany didn't understand...

Cant forget that nearly half of all profits are stolen by Uncle Sam. So to clear 50k a year profit, you have to actually make closer to 100k

Apr 4, 2016 7:05pm

Quoting The Fool

Disliked

EXPLAIN

Ignored

Taxes on 200k in 60 years higher than taxes on 10k right now? Is what I suspect.

Or you could just add in the 2008 effect. Robbing pensions only to be bailed out. Your generation got screwed on IRA

Apr 5, 2016 10:16pm — Edited

The only Self Awareness to cultivate is the realization that a trading fund of 1,000 or 500,000 makes no difference. Anyone can be a full time professional forex trader until all the money runs out. Then, the Self Awareness becomes: " it's time to get a real job."

Apr 5, 2016 10:42pm

Quoting jmn5611

Disliked

Hmmm, how about leverage considerations. A large account can afford to be conservative, no?

Ignored

True.
Yet, this is true also:

Quoting Tony112

Disliked

One thing: falling from 5000$ to 0$ is as easy as falling from 500,000 to 0$.

Ignored

Proper leverage consideration only means it takes longer to lose all the account.

Apr 5, 2016 10:54pm

Quoting jmn5611

Disliked

Not if you ever in this life come to understand PA, risk, and position sizing.

Ignored

They only postpone the inevitable. What no one understands is what to do before the inevitable.

Apr 5, 2016 2:57am

Quoting VaBikePacker

Disliked

"Holy Grail" does exist - it's just not where most traders think it is.

Ignored

something like
patience - positive mood - not expecting to be rich with a blink of an eye?

Apr 4, 2016 6:31pm

Quoting The Fool

Disliked

stick it in the Roth IRA so you can tell Uncle Sam to stick it

Ignored

...for now....but the reality is, setups like that exist solely so that they'll just collect more later...

Apr 4, 2016 7:16pm

Quoting The Fool

Disliked

EXPLAIN

Ignored

ever seen taxes go down?

You pay taxes on those IRA deposited funds before all is said and done. Guess your "financial planner" skipped that part because of how much he was being paid for you to put your money in...

Apr 5, 2016 6:05am

Quoting thodie

Disliked

something like
patience - positive mood - not expecting to be rich with a blink of an eye?

Ignored

yeh, those too....

I was poking at how important "introspection" is as a trader and understanding how your system needs to "work" with you and your own mental framework. Once you achieve this, you've arrived at your holy grail....Failing to recognize what your mental framework "needs" in order to trade is a place, probably about 90%, of traders won't go...

Apr 6, 2016 7:01am

regardless of account size the ratios are all the same. Larger accounts breed more emotional responses and the key to being a successful trader in my opinion is focusing in on learning how to control those emotions.

Let's be real: the only difference between 100 and 1,000,000 is zeros.

If it were a difference that was supposed to mean something, why does something that means nothing designate the difference AND impact a traders emotions so much?

Certainly with a small account generating a living wage ain't gonna be easy to do. I'm speaking of the transition time all of us go through from working to trading. Having a $100, $1k, $5k account to learn on is certainly good and has less risk in order to discover your own holy grail. The trick is the discipline to treat that small account like it's a $1,000,000, $10,000,000 account.

Apr 4, 2016 4:25pm

Quoting The Fool

Disliked

^^Indeed. Everything is relative, but I have argued in this forum that a normal adult (with a mortgage, a family, etc) US trader needs to be trading a min of ~$150k liquid equity just to make a living. And the more the better. I would not personally quit my day job unless I had about $250k to trade.

Ignored

One person may be able to make a 30 or 40% return on $100k and that be sufficient to cover their expenses with some left over. Another may only be able to make 20% on $300k and that not cover their living expenses.

I think it's about having sufficient capital relative to one's living expenses and a proven track record (at least a year but preferably longer) of making a certain percentage return. Having a consistent return across different trading conditions would also be a must.

Anyone with insufficient capital can just trade part time whilst they still work and should then be able to save all their trading profits (after tax) to build their capital quickly. Not all systems need to be full time. Larger time frames aren't time intensive and once I have sufficient history of consistent returns to leave my non FX job I plan to still only trade part time.

Apr 4, 2016 10:32pm

Quoting TooSlow

Disliked

The point of the article is SELF AWARENESS. The more money one has to trade means they have more to lose if they are not SELF AWARE.

The article describes most of the traders on the forums. You can see how many indicators they cram on their charts to the point you can't see a price bar clearly. You see traders flocking from one thread to another in search of the Holy Grail. You see them flaming each other. Sheer madness!

How many readers have taken the steps the author listed?

Ignored

We are supposed to read the article??? How can we do that with such a short attention span?

Apr 6, 2016 9:35am

Quoting CoolJL

Disliked

How about having a large enough capital? There is a big difference between trying to make a living out of 50K, 500k or 5m. With 5m you be can be fairly relaxed and can achieve zen like self awareness, with 50k it'd be stress overload, and can easily fall into self awareness death spiral.

Ignored

You nailed it. Its the capital which realy makes a difference. Your four lines speak a lot more sense than that linkbait of a BS article

Apr 4, 2016 2:14pm — Edited

Yeah, this is a great discussion indeed.

A good plan is to make one single withdrawal either once per month or once every 2 to 3 months [or whenever you end any given month with a +positive+ percentage gain] and only withdraw 3% to 5% of your total balance so that you will have enough for your expenses while still keeping the majority of your funds in your account to keep trading and compounding/growing your overall balance.

Once you have gotten to the point where you can trade and be consistently profitable in almost any market condition then taking out 3% to 5% (on a monthly or quarterly basis) would be a very good amount to make a living with. It may not seem like much at first but it could be quite significant on a monthly or quarterly basis as time goes by.

Here's a brief example:

Let's say you have started with a $50,000+ USD account and at the end of every month you are seeing increasing gains over time say after a 3 to 6 month period but you have not yet made any withdrawals yet.

So now your total balance is = $64,356 USD and now you feel the need to make your first withdrawal as a way to celebrate and pay a few bills, or take a much needed vacation to relax or maybe you need to buy a new computer, etc. Let's say you made this withdrawal on the first day of March.

So $64,356 - 3% = $1,930.68 (leaving you with a new balance of $62,425.32). Hey not so shabby because $1,900+ per month or even every 2 months is a pretty good chunk of change if you ask me to extract from the FX market!

The funny thing about this too is the fact that you still have a ton of money leftover in your account to trade with, so imagine how this will only get better over time as your account grows and compounds.

Those little small 3% to 5% withdrawals will be HUGE before you realize it. Now plug in the numbers at a 5% withdrawal rate and just imagine the smiles that would bring

So have this as your rule:

"I shall only withdraw 3% to 5% max from my FOREX trading account once every month [or whenever I end any given month OR Quarter with a +positive+ percentage gain] and I will only bend this rule if absolutely necessary or for emergency purposes!"

Apr 4, 2016 5:08pm

Quoting Steve J

Disliked

What you stated is confusing. Bi - monthly means twice a month but in your narrative you described it as once every two months. Secondly, it is difficult to make profits every month. The reality is, sometimes one may see a monthly deficit and only be able to make a net profit over a longer period eg quarterly.
The vagaries of Forex may render monthly withdrawals to be unwise. One should only withdraw when target profits have been reached.

Ignored

You're right my mistake, I meant every two months. But yeah, it was just an example because realistically you cannot just say you're going to make a withdrawal at any given time because it depends on if you had a positive month or not.

But you get the idea right as I was just trying to make a point of sticking to some sort of a withdrawal plan?

So to make it easy to remember just withdraw 1%-5% whenever you can afford to do so and still have enough funds to continue trading with.

Apr 4, 2016 11:49am

stick it in the Roth IRA so you can tell Uncle Sam to stick it

Apr 4, 2016 1:40pm

One thing: falling from 5000$ to 0$ is as easy as falling from 500,000 to 0$.

Apr 4, 2016 6:33pm

Quoting VaBikePacker

Disliked

...for now....but the reality is, setups like that exist solely so that they'll just collect more later...

Ignored

EXPLAIN

Apr 4, 2016 7:53pm

Let just think is this way. If u have less but profitable. Then is like you just a job that pay minium wage. ( minium wage ppl do make living) So just cash out a little and build up your account. If you got alot in your account. Then is like you have like million or so but profitable, then u treat like a career as a doctors, ceo etc.. and cashe out hundred thousand. Doesn't matter where you are in the money balance wise. The key is the knowdlege and how profitable you are, not how much balance in your trading account.

Apr 6, 2016 2:45am

Quoting Rtm

Disliked

you need a bit of luck to be trader.

Ignored

tossing a coin

its easy

Apr 6, 2016 2:52am

flo2 on a chart is a holy grail

but I have been wrong before

sorry for interrupting a very important holy hole

Apr 6, 2016 3:37am

Quoting TwFXtrader

Disliked

Turning 1k to 50k doesn't mean your a world class trader.

Ignored

fkn stupid quote

Apr 4, 2016 11:57am

Nice and essential for newbie..

Apr 5, 2016 6:18am

Quoting thodie

Disliked

something like
patience - positive mood - not expecting to be rich with a blink of an eye?

Ignored

Stop that crazy talk right now

Apr 5, 2016 11:14am

Stick with a systems and apply each and every day...

Apr 6, 2016 2:27am

you need a bit of luck to be trader.

Apr 5, 2016 2:42am

"Holy Grail" does exist - it's just not where most traders think it is.

Jun 12, 2016 5:07pm

Quoting The Fool

Disliked

EXPLAIN

Ignored

I guess my explanation hurt his feelings enough he decided to ignore me...lol...

Apr 6, 2016 6:08am

There is a real argument to having lots of liquidity to start out with... it certainly helps and I ll explain why.. to me, the surest way to become a professional trader/investor is patience.. when you are a newbie, you trade constantly because you still feel that rush and sadly, trading a lot, losing a lot... As you get more experience , either with your entries, support and resistance, chart patterns , drawing triangles and waiting for that central bank decision, it forces to "wait" for your moment.... The break out comes and for opportunistic traders/investors, you leverage yourself appropriately and hit 10, 20 or 50% return on just few weeks or even a day of trading .... The rest of the time, you can just "chill" and wait for the next one... If you observe the markets carefully whether currency , equities or commodities, there are "cycles" within a year or even quarters or weeks where you can trade comfortably. Therefore, having more liquidity will allow you to take full advantage of opportunities.

Apr 4, 2016 10:05am

How about having a large enough capital? There is a big difference between trying to make a living out of 50K, 500k or 5m. With 5m you be can be fairly relaxed and can achieve zen like self awareness, with 50k it'd be stress overload, and can easily fall into self awareness death spiral.

Apr 4, 2016 11:38am

Sadly, I have to agree with you all. The fact is when you have more capital you can take a loss but then have enough funds to recover. Conversely if one's capital is low it is harder to recover because of lack of equity and a nervous disposition that will unsettle one's trading decisions.
If one can learn to trade well, before deploying a large deposit, the odds are vastly improved for being able to make a well paid profession out of trading.
The reality is most don't have > $250K to trade with; so most can only trade part-time. Attempting to amass 250K from 25K is a slow and painful process therefore it is imperative to trade according to one's means. Think about profit in terms of percentage of deposit and not in absolute cash.

Apr 4, 2016 2:47pm

What you stated is confusing. Bi - monthly means twice a month but in your narrative you described it as once every two months. Secondly, it is difficult to make profits every month. The reality is, sometimes one may see a monthly deficit and only be able to make a net profit over a longer period eg quarterly.
The vagaries of Forex may render monthly withdrawals to be unwise. One should only withdraw when target profits have been reached.

Apr 4, 2016 3:23pm

Quoting The Fool

Disliked

^^Indeed. Everything is relative, but I have argued in this forum that a normal adult (with a mortgage, a family, etc) US trader needs to be trading a min of ~$150k liquid equity just to make a living. And the more the better. I would not personally quit my day job unless I had about $250k to trade.

Ignored

Absolutely correct. We have worked with numerous former bank/fund traders over the years. And trust me, some of these guys have been BAD-ASS traders. Yet none of them (as far as I know) have traded personal accounts with anything less than $300k.

It simply a matter of psychological comfort (and math). The less capital you have, the more leverage you are tempted to use and you automatically start turning the math against you.

My 2 cents....Best of luck!

Apr 4, 2016 8:30pm

Comes down to math and math again and only math, the more you invest in a trade and you fail, the harder the fall. The more you invest in math before making a trade, well Newton law or just some simple calculus can make a wealth of difference.
Happy trading.

Apr 5, 2016 11:54am

Quoting moneyflow21

Disliked

So have this as your rule:

"I shall only withdraw 3% to 5% max from my FOREX trading account once every month [or whenever I end any given month OR Quarter with a +positive+ percentage gain] and I will only bend this rule if absolutely necessary or for emergency purposes!"

Ignored

That's precisely my way of trading and making additional 20-30% of my regular salary on a month/2 months basis. You do need a capital to simply feel more relaxed and letting your trades breath for 75-100 on majors and 100-150 pips on crosses.
That's why Forex will always be better than indices and shares simply because here's far more liquidity and opportunities. Just learn to recognize which currency is being sold, which currency is being bought, and which currency is just flat and choppy at any given moment and you will find your own benefit from that.

Apr 5, 2016 1:20pm

Quoting CoolJL

Disliked

How about having a large enough capital? There is a big difference between trying to make a living out of 50K, 500k or 5m. With 5m you be can be fairly relaxed and can achieve zen like self awareness, with 50k it'd be stress overload, and can easily fall into self awareness death spiral.

Ignored

So much heartbreak would be avoided if more people understood this.

Trader#5B78

Apr 4, 2016 10:58am

Quoting CoolJL

Disliked

How about having a large enough capital? There is a big difference between trying to make a living out of 50K, 500k or 5m. With 5m you be can be fairly relaxed and can achieve zen like self awareness, with 50k it'd be stress overload, and can easily fall into self awareness death spiral.

Ignored

This^^

I am a full-time trader (by which I mean an independent trader, whose main or sole income comes from trading) and I can tell you now it's no fun when your capital is less than 50K, or even 100K. The more you have, the more comfortable you are, and the less you need to lever up to make the money you feel you need to live comfortably.

Trader#F5E1

Apr 5, 2016 2:30am

Quoting Not-KPMG

Disliked

What a discussion And the moneyflow chap just made it stupid with his numbers. Who cares when u withdraw money??? . Here is what matters : trade well, pay attention to market, read what smart people post. Close at night.... A semi-smart man can make 7 to 10 % a month easy. Or more with risk. That's it.

Ignored

My reading comprehension is very good. The moneyflow chap never said â€œbi-monthlyâ€. So the criticism of Steve J is unwarranted. Attention to detail is important to trading. Having a good trading system that works is most important. Following the rules of the system will generate the profits you need to be successful. What is your trading plan? Did you write your plan out each and every day? Make a written plan. Follow the plan. Make profits!

Trader#AEB2

Apr 5, 2016 9:46am

Quoting thodie

Disliked

something like
patience - positive mood - not expecting to be rich with a blink of an eye?

Ignored

Perfect.

Patience + positive mood + genuine intense passion for trading and competition + extremely hard work = Opportunity to succeed

Trader#0926

Apr 6, 2016 12:12am

To become a full time trader you need to a) know market dynamics enough to turn $1000 to $10,000 b) confirm that feat by hitting $50,000 from that second base. Once you have reached "b" you are a world class pro that can rightly c) trade for a living and d) are morally qualified to trade other peoples monies. Anything short of these points made (in my view) is nonsense. Mark you there is a basis for the numbers but those are too long to restate here.

The Crow (-_-)

Trader#4F36

Apr 5, 2016 4:26am

the secrets to becoming a successful trader:
1. IQ above 130
2. very little fear under intense pressure.

that's about it - darth trader.

Story Stats

Apr 4, 2016 9:25am
Posted by
Newsstand

Educational

47

18.1K