I have had many readers through the years and students of my trading course –most of whom were less-experienced traders–tell me that at some point in the future they planned to quit their 9-5 jobs and become a full-time trader. Traders who have recently entered market and made good money also plan to become a full time trader. While their optimism was certainly positive from the standpoint of eagerness to learn about a truly fascinating business, it is also probably unrealistic that they will ever make a good living as a full-time trader.
Readers who are reading this article should answer the below few questions honestly and diligently that may help determine if you are ready to attempt to join the elusive rank of “full-time” trader.
Questions to ask yourself if you think you might be ready to trade futures full-time:
- Are you a successful part-time trader?
You’ll need to be successful at trading on a part-time basis before you think about moving into the full-time trader ranks. Don’t be fooled into thinking that trading futures on a full-time basis will allow you to spend more time to cure your part-time trading ailments. In other words, don’t say to yourself: “If only I could spend more time trading markets, I could have more success than I’ve had just trading ‘one-lots’ here and there.”
- Do you have enough money available to live on when (yes when, not if) you hit a streak of losing trades?
A losing streak will inevitably occur–and probably sooner rather than later. And I don’t mean a losing streak of two weeks, but think of worst case scenario what if you bust your whole trading account. Will you be able to survive the bad period without disturbing your family life ?
- Do you have the psychological stamina to be a full-time trader?
Quite frankly, most people do not. Can your psyche handle six months of mostly losing trades?
- Will your immediate family members support you–even during a prolonged rough stretch of trading?
Believe it or not, this is a very, very important question. For example, if your spouse does not support your decision to trade full-time, then you are likely doomed to failure. The pressure of having to produce winning trades and knowing that your spouse is skeptical of your efforts is almost insurmountable.
- Will you be able to uphold your family or other important responsibilities even during a rough trading stretch?
Do you have enough reserve cash to sustain in losing streak. Can you move out of your luxurious lifestyle when you hit a losing streak. Do you have patience to hold on to the trade for 10 days ?
If you have Yes as answer with proper reasons/justification than think of becoming a full time trader, if not do not risk your personal and financial life.
One more thing: I do have many students that are “full-time traders” but who do fall into a different category than what I described above. These are people who do have enough money to trade on a full-time basis–even if their trading profits alone will not support their lifestyles. These are individuals who already have significant amounts of money derived from means other than trading futures. Also, I have many readers who are now full-time traders, and that have retired from another profession and want to spend the “autumn of their lives” not in a rocking chair, but in a field that is challenging to them. Again, they, too, have other means of income besides just futures trading profits.