Transition to full time trader quitting school and work

A

apo99

Hey guys

First post, so here goes!

I just want to introduce myself to everyone beforehand. I am a 25 year old finance student


For the last 5 years I have been consistently trading small cap stocks between (0.25-3$) I have had only 3 losing months out of the past 60 months and average around 42-57% a year. My system also allowed me to trade while in class and at work and also allowed me to monitor my positions from my cell phone and PC at work I only work about 20-25hrs a week part time and I am allowed to trade at work.

I started trading with about 7-8k in 2011 and now I’m at 200k with some money I added as well. I am able to net close to 100k a year trading and another 25-30k working part time.

My biggest fear is that one day the market or the way these small cap stocks are priced will dramatically change and I won’t be able trade the way I do and will never be able to stay consistently profitable. I have recently stopped going to school and have switched to working only part time so I can focus on trading. How have you guys gotten over the fear of losing your edge or not being able to trade profitably. I don’t want to be a 35yrld trader who loses his edge or blows out and then becomes unemployable or has no other skills.

I also don’t use a technical system, just price action and volume and reading the bid/ask. I feel like my small cap system is more of an art form than anything else. If you approach trading with a purely mechanical system I think you will get cut down after some time. My dream is to become a full time trader in the next 3-4 years and would greatly appreciate if you guys can tell me how you transitioned into full time traders and what were some of the challenges you guys faced?

Cheers
 
First off when I quit working for the gov't, I had two businesses going that was bringing in healthy funds plus I had quite a few rental houses that were all positive cash flow, and I had three million in the bank from trading-all from mechanical trading and done so over three decades. So even if/when my methods stopped working, I had something to fall back. You don't even have a degree, so you don't even have education which at very least open doors, you be that guy at the window saying "can we supersize that"? You have to have fallbacks, it markets go in bear market, many of what you trade might not allow to sell short, then what? That is a major problem of those who have learned how to trade a bull market as you have zero experience of the bear and many low end stocks can't be sold short. I never have and even today have looked at trading as a job, always been full time hobby, my taxable funds have come from other areas of investment or jobs I have taken and now which 99% of it automated, I have more time to design and back test and do other things in my life. This is where having mechanical systems be better that what you are doing, I no longer have to trade or watch screens and can trade any amount of instruments and you are limited.
 
Handle123 said:
First off when I quit working for the gov't, I had two businesses going that was bringing in healthy funds plus I had quite a few rental houses that were all positive cash flow, and I had three million in the bank from trading-all from mechanical trading and done so over three decades. So even if/when my methods stopped working, I had something to fall back. You don't even have a degree, so you don't even have education which at very least open doors, you be that guy at the window saying "can we supersize that"? You have to have fallbacks, it markets go in bear market, many of what you trade might not allow to sell short, then what? That is a major problem of those who have learned how to trade a bull market as you have zero experience of the bear and many low end stocks can't be sold short. I never have and even today have looked at trading as a job, always been full time hobby, my taxable funds have come from other areas of investment or jobs I have taken and now which 99% of it automated, I have more time to design and back test and do other things in my life. This is where having mechanical systems be better that what you are doing, I no longer have to trade or watch screens and can trade any amount of instruments and you are limited.
More...

Thanks Handle for sharing your experience. Although I have no intention of quitting my academic positions at University, it really gives me good ideas of what sort of steps I should take in the future.
 
Handle123 said:
First off when I quit working for the gov't, I had two businesses going that was bringing in healthy funds plus I had quite a few rental houses that were all positive cash flow, and I had three million in the bank from trading-all from mechanical trading and done so over three decades. So even if/when my methods stopped working, I had something to fall back. You don't even have a degree, so you don't even have education which at very least open doors, you be that guy at the window saying "can we supersize that"? You have to have fallbacks, it markets go in bear market, many of what you trade might not allow to sell short, then what? That is a major problem of those who have learned how to trade a bull market as you have zero experience of the bear and many low end stocks can't be sold short. I never have and even today have looked at trading as a job, always been full time hobby, my taxable funds have come from other areas of investment or jobs I have taken and now which 99% of it automated, I have more time to design and back test and do other things in my life. This is where having mechanical systems be better that what you are doing, I no longer have to trade or watch screens and can trade any amount of instruments and you are limited.
More...


This is why im considering still finishing school since im 90% done, might as well finish it. Trying to work on other systems but i cant seen to branch out to other things since they trade so differently. Thanks for the advice
 
Wow - you are ahead of the curve for sure having actual decent profits already made to launch from and a strong track record. Usually I would be the skeptic because most aspire tradings are banking on futures profits and have not made an money yet. Where you have the profits already and great track record to trade from. Seems like you are fit to to do well. The market may change a bit, but you can adapt. The only thing I may add is I wish I had spent more time learning about taxes related to trading because it bit me real hard - got blind sided and took a crazy hit that could have been avoided if I had made learning trading taxes part of my business model instead of relying on my stupid CPA that gave may bad advice. Good luck.

Cheerio
 
comagnum said:
Wow - you are ahead of the curve for sure having actual decent profits already made to launch from and a strong track record. Usually I would be the skeptic because most aspire tradings are banking on futures profits and have not made an money yet. Where you have the profits already and great track record to trade from. Seems like you are fit to to do well. The market may change a bit, but you can adapt. The only thing I may add is I wish I had spent more time learning about taxes related to trading because it bit me real hard - got blind sided and took a crazy hit that could have been avoided if I had made learning trading taxes part of my business model instead of relying on my stupid CPA that gave may bad advice. Good luck.

Cheerio
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You might want to read the attached journal.
The journal was written by my ex-professor.

and there was a related article on CNBC.

http://www.cnbc.com/2016/04/29/it-sounds-crazy-but-sell-in-may-and-go-away-is-good-advice.html
 

Attachments

comagnum said:
Wow - you are ahead of the curve for sure having actual decent profits already made to launch from and a strong track record. Usually I would be the skeptic because most aspire tradings are banking on futures profits and have not made an money yet. Where you have the profits already and great track record to trade from. Seems like you are fit to to do well. The market may change a bit, but you can adapt. The only thing I may add is I wish I had spent more time learning about taxes related to trading because it bit me real hard - got blind sided and took a crazy hit that could have been avoided if I had made learning trading taxes part of my business model instead of relying on my stupid CPA that gave may bad advice. Good luck.

Cheerio
More...
Thank you,

All my taxes are handled by a great accounting firm, Since i still work and I am still registered as a student, there are some tax benefits to it plus the fact that i get insurance, and a guaranteed income.
 
The amount your making and account size, keep going, change nothing only a few years to the million, if you can work and trade keep doing it, millionaire in what 5 years.

When it stops working and you start losing then worry, stop trading, work out why, fix it.
 
Turveyd said:
The amount your making and account size, keep going, change nothing only a few years to the million, if you can work and trade keep doing it, millionaire in what 5 years.

When it stops working and you start losing then worry, stop trading, work out why, fix it.
More...

Thanks

Its just an incredible amount of stress on me and I am already a worrisome person. If i can walk away with 1.5-2m in the next 10 years I would be happy it would be worth it. I guess i should start working on other systems and other methods of trading, but i fear that retail traders will no longer exists or be unable to compete in 20 years.
 
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