Aspiring traders often ask me whether or not it’s really possible to make a living trading the market.
The short answer is yes.
The longer answer is, yes you can make a living trading the market but you have to consistently do a lot of things right. Most traders simply do not yet possess the necessary trading skill, discipline, patience, or realistic attitude to succeed long-term in the markets.
However, this does not mean that it is impossible. You simply have to learn what you need to do to become a consistently profitable trader, and then do it. Easier said than done, I know. So let me give you some valuable insight into what it takes to be able to trade for a living.
How much money do you need to make a living as a trader?
The first thing you need if you want to make a living trading the market is enough starting capital; if you are under-funded you will have to accept that you will not be making a living from trading any time soon. The exact amount of disposable money that you will need in order trade full-time will be different for everyone. But, generally speaking, if you plan on effectively managing your risk on every trade, you will need a decent amount of money at your disposal in order to trade a large enough position size to make enough money to support yourself while at the same not risking too much of your account on any one trade.
Part Time trading for extra income is more easy to achieve in the early stages of you trading career. You can obviously still trade and make consistent money each month even if you don’t have enough money to allow you to trade for a living just yet. However, instead of putting pressure on yourself to make a lot of money really fast, focus on building a consistently profitable track record and self confidence and the money will follow. Even if you have a lot of money to trade with, if you do not focus on the mechanics of successful trading, you will lose regardless. When I started trading, I started small, and when I became good, I approached people for money to trade, I built up my own capital and then went out on my own. People need to focus on becoming good traders and not focus on how much money they are trading, because let me tell you, if you are good, people will throw money at you to trade for them, and you will be fine in the long run (there are funds and private investors looking for good traders to trade for them, but you need to be good). My most sincere advice in the early stages of your trading pursuits is to aim to be a part time trader and a good one ! Big things will follow for you in the future if you can get this first part right.
So, yes, you do need a relatively large amount of money in order to trade full-time and be a player, but you still must be able to be a consistently profitable trader regardless. If you cannot make consistent profits on a small or medium size trading account you will not make them on a large account either
Trading for a living is the result of doing a lot of things right.
Trading the market for a living does not only depend on being sufficiently funded and trading the charts. These two components are important, but there are a lot of other things you have to do too. Including the following:
• Learn and master a truly effective trading strategy like price action.
• After learning and mastering an effective trading strategy, design a tangible and “working” trading plan around it. Refer to this trading plan every day and tweak or update it as you learn and grow as a trader.
• Identify a logical and tolerable risk amount for every trade you take, do not ever risk more than you are comfortable with losing on any one trade. Practice proper money management.
• Do not over-trade. Doing everything else discussed in this article will help you to not over-trade. But you really have to be consciously aware of this huge trading mistake. Most traders trade too much and in my opinion this is the number one reason most of them fail to make a living in the market.
If you are properly funded, have mastered the daily charts, are consistently and perfectly executing your edge, are following your trading plan, are recording your trades, and not over-trading or over-leveraging, you have a very good shot at eventually making a living from the market. The trick is that you must do ALL these things right. You can’t just do one, you have to be on top of your game all the time to make a living as a trader; it’s not easy or get rich quick.
Learning to trade from a successful trader can help you achieve your goals faster.
Just like any other profession or skill in life is easier to learn from a mentor, learning to trade from a skilled trading mentor is arguable the most efficient and effective way to achieve your trading goals.
For almost 4 years, I have shared all my technical price action trading strategies with the public in my trading course . I provide aspiring traders with the necessary pieces of the puzzle, but it is up to them to put them all together, I cannot do this for you. There are many “human” elements to trading that will require much effort on your part to master. If you can master the technical aspects that I teach along with the human elements, trading for a living is a realistically achievable goal for you.