Is active trading a viable job for an individual?

[BYoung]

Hi all. I'm new to the board. This is my first post.

I've been in IT for 25 years. I may be ready for a change. What are the odds of an old dog like me (46) actually making a living as an active trader? I know there are tons of variables and this is a borderline stupid question, but let me provide a bit more info about myself...

I have a good intellect - not in MENSA mind you - but I do ok. I've always found that I picked things up faster than those around me most of the time. I'm a naturally analytical person and have no problem immersing myself in something complex. I also have a decent amount of savings that I could use to get started with. From a work ethic perspective I will put in the work as long as it's taking me somewhere. Are there any others out there like me? If I couldn't make at least $150K/yr I probably would not be interested. I'd love to hear stories from those who may have tried this and how it worked out. Thanks in advance.

 

[Robert Morse]

If I couldn't make at least $150K/yr I probably would not be interested

This will take more than time and skill. You won't know until you get started. Why not keep your job and start slowly and scale from there? Then as your make money you can move to full time trading.

 

[AlexxS]

Hi BYoung

I’ve been asking myself the same question. Trading (futures) is essentially a negative sum game because of all the transactions costs. And the players you are up against play a hard game. They have better information than you do, they see swap flows, bond flows, they may have the commodities you trade in physical storage, they have an army of economists and quants working full time, they have more experience than you and connections to the highest places, can influence policies, they talk to the managements of the companies you are trading. You get my point.
So the question is: What is your edge? Is it possible to have an edge? What is an edge?

I only got interested in trading about a year ago. I’m good with numbers, know a thing or two about game theory, am a fast learner and can get enthusiastic about things quickly. The way I am approaching this is by seeing it as a challenge, or maybe I should say 'game'. I’m more interested in learning the dynamics of the game, the ever changing rules. If I succeed, great. If not, I’ve already learned a lot about the inner workings of the market that it has been worth my time. What I am suggesting is that if you do not take pleasure in the process, there might be little to gain in trading.

For the past several months I’ve been backtesting strategies. Several dozen in fact. In January, I started forward testing five of them. I am currently left with two that seem to be working. That’s pretty much all I can show for one year of intense study.

Do I have an edge? I don’t know. Do I enjoy the process? Very much so.

 

[Xela]

I know there are tons of variables and this is a borderline stupid question

The fact that you already know that (unlike some people who ask the same question), in my opinion, shows that you're very far from "borderline stupid" yourself, and suggests to me that you're probably not going to over-interpret the answers, and that you know really that nobody can possibly give you a reliable answer to this.

In that spirit, I'll offer a borderline stupid answer.

In my opinion/estimate, the incidental information you give about yourself above means that your chances of successfully negotiating the journey from "no trading" to "making a living from trading" are at least ten times as high as those of "the average person who asks" ... and for that "reason", I'd say that you have at least a 1% chance (I'm guessing - maybe rightly, maybe wrongly - that something in the order of 1 in 1,000 people who ask this question achieves what you're asking about, so that "must" give you at least a 1 in 100 chance?).

For what it's worth (if anything).

And I agree with Bob's suggestion just above, needless to say.

Good luck - and welcome to the ET forum!

 

[Robert Morse]

Trading (futures) is essentially a negative sum game because of all the transactions costs.

I like your post accept I do not agree with this statement. It is not a zero sum game when the trader on the other side of your trade can be a speculator or hedger. And fees are only an issue for those that scalp one tick. For position traders or those looking for a longer time frames than seconds, futures and options on futures are highly levered and fees are low vs that leverage, IMO.

 

[Maverick2608]

Base rate probabilities.

If you spend 25 years actively trading, it can be not only a viable job but extraordinarily lucrative.

If you spend 25 years working with IT, in all likelihood working with IT will be much more profitable than active trading and with certainty carry significantly less risk.

 

[jinxu]

Hi all. I'm new to the board. This is my first post.

I've been in IT for 25 years. I may be ready for a change. What are the odds of an old dog like me (46) actually making a living as an active trader? I know there are tons of variables and this is a borderline stupid question, but let me provide a bit more info about myself...

You should ask a member here named "vincentnyc" as he is both a trader and in IT. And is also your age and works in NYC. So there is a chance you and him can become buddies.

He says he is a super successful trader and it took him less then a year to become profitable. Hehe.

 

[fan27]

How much capital do you have available for trading?

 

[TDMA]

Hi all. I'm new to the board. This is my first post.

I've been in IT for 25 years. I may be ready for a change. What are the odds of an old dog like me (46) actually making a living as an active trader? I know there are tons of variables and this is a borderline stupid question, but let me provide a bit more info about myself...

I have a good intellect - not in MENSA mind you - but I do ok. I've always found that I picked things up faster than those around me most of the time. I'm a naturally analytical person and have no problem immersing myself in something complex. I also have a decent amount of savings that I could use to get started with. From a work ethic perspective I will put in the work as long as it's taking me somewhere. Are there any others out there like me? If I couldn't make at least $150K/yr I probably would not be interested. I'd love to hear stories from those who may have tried this and how it worked out. Thanks in advance.

10,000s+ hours of training and not paper trading after which most still will not succeed (Outliers), or you buy the 10,000s hours which they will want to make sure they get paid the $300k-$500k via profit share and leasing, or a hybrid of the two such as prop trading which often just confuses most people. Then after that most target 1-2% return on capital per year so you need a good $½million or so, unless you compound using sub-minute timeframes, but you won't have access to the fintech as that will use up all your capital.

And if you want to go through the 10,000+ hours yourself which is what basically everyone does, understand you will not generate breakeven trades until you pass the 0 barrier, and not be materially profitable until the end flattens out. Not forgetting that the 0 peak is K2 sized, not Mount Rushmore, it's possible but you will sacrifice your soul, fantastic if you're a capital trader, not so much fun as an income trader.

 

[wrbtrader]

This will take more than time and skill. You won't know until you get started. Why not keep your job and start slowly and scale from there? Then as your make money you can move to full time trading.

Exactly...many people don't realize they have many options to test the waters sort'uv speak.

1) Keep their job and trade before/after work.

2) Keep their job and trade on vacations.

3) Keep their job and take a leave of absence.

4) Keep their job...change their schedule so that they work on the weekends and trade on their day off from work (two weekdays per week)

wrbtrader