Any advice for a soon to be full-time trader?

[ElectricSavant]

Howard,

I admire your decision to trade full time. It does not seem like this is your first rodeo. I hope that this restart will last a little longer than your last try at it. I have started and restarted several times in my life and I am now starting again also.

Have you looked at the Index Future Micros?

Anyways...Good Luck to us.

ES

 

[killer007]

If you can make consistence positive, good idea to trade full time
It's still better to have a full time job and Trade in your off days...

 

[bbpp]

More essentially it is how ready you are regardless how much capitals you have (within a reasonable range of course).
Look at that guy trading Micro with $1000 and gained >$400 within a month, and he used very conservative leverage (he trade 1-2 micro), had he used the more aggressive leverage (5-10, as one micro is only about $60-80 day trading margin), he would be up $4000, that is 400% return in a month. Of course consistency is more important, so lets see if he can continue to keep that rate.

Would not trust anything except account statements.
I saw numerous times people claim to make 100% monthly consistently only to find later(when they went to C2 to sim trade) they blow up accounts several times in a row.ET has too many false"profitable traders."If you take them too seriously, you are fooled.

 

[gaussian]

I have an account size of just over $15K. I day trade US index futures.

Good for you for saving 6 months of living expenses - but 15k is far to little trade into a position where you can live off of your gains. Consider the following:

You didnt mention where you live so I will assume US - adjust accordingly.

1. Healthcare costs can be expensive.
2. You will be paying a better rate on taxes than options or equities but it will be significantly more than you were paying at your day job. This needs to be accounted for in your profit.
3. The poverty level in the US for 2 people is about 16,000. You will need to more than double your account, plus some for taxes, healthcare, and other expenses in order to hit this. Even more if you (wisely) want to grow your working capital. This is almost impossible to do with any consistency and you are making a mistake.
4. E-micros won't be a great way to double your account quickly so you'll be way over your head (account wise) in full size e-minis.

I hope to one day become a professional trader. Doing the math for me I would need an account close to $150k and around 1.5 years of living expenses to be able to make the plunge. I strongly advise you talk to not only your girlfriend, but a tax attorney so you understand the situation.

 

[imjohn]

You will be paying a better rate on taxes than options or equities but it will be significantly more than you were paying at your day job.

Good points made, though for taxes (US):

Income earned from employment (OP's day job) is 100% ordinary income subject to payroll taxes.

Any profit he earned from trading futures will be taxed 60% LT capital gains rate / 40% ST (ordinary income tax rate), no payroll taxes.

https://www.forbes.com/sites/greats...56-contracts-has-tax-advantages/#78c3d051f809

 

[Snuskpelle]

Of course account size is related to living expenses, but minimum in civilized parts of the world is 100k. 200k-400k is safer. Sure, you can read about some survivors who managed to work themselves up on less, but that usually involves insane risk taking and so there is a strong survivorship bias.

Also if you're not making money part time, you're not going to be making money full time despite this being a convenient mental excuse for quitting one's job.

My advice: Double your $15k in $30k with trading. After that, you will know how long it will take you to do it again, and you gain the extra certainty of knowing you can do it. Besides, you will now earn twice as much by scaling. Only then, consider reducing regular work hours, but preferably go unemployed only if doubling once more or twice. ;-)

 

[fan27]

I strongly advise you talk to not only your girlfriend, but a tax attorney so you understand the situation.

Agreed...definitely talk to the girlfriend. Talk to her about her career ambitions and potential future income as it will likely be needed

 

[maxinger]

welcome to full time trading.

It seems like you were doing swing (or position) trading, not day trading.
And you were trading on and off, and were full time trader twice.

It appears the under capitalized problem might be due to money management / risk management issue. If you maintain a good trade Journal, you might be able to identify the root cause. Do go through the trade Journal.

I may be wrong but I guess when your account ( which is probably not leveraged) is small,
you traded not so frequently and hence your trade journal might have fewer entry.
So in that sense, you might not have sufficient experience to decide next course of action.


Before I became full time day trader, I had full time job and I day traded during my evening and night time and demo trading on all weekends. Average sleeping hour for one whole year was 4.5 hours only.
It was extremely tough for me. Even when I was full time day trader, it was a struggle as it took me very long to develop our own holy grail.
This is something you might want to consider.


I guess you understand the freedom (and also boredom) when we become full time trader.

 

[R1234]

Advice: Kmart sell quality blue plastic tarps. Costco have the best shoping trolleys.

good one!

 

[Evermore2017]

I agree, in my case I need 100K account(for daytrading), 6 to 12 months of living expenses and 300K to 400K in others investments for move to full time trader.