Trading is perceived as a challenging and high-risk profession requiring money, time, and knowledge.
However, it can become a full-time or part-time career opportunity if addressed with the right attitude and approach.
Just like a lifelong learning experience, trading needs education, ambition, and patience. Almost anyone can trade for a living and turn his passion for the markets into a job.
Even though trading is viewed as a high barrier-to-entry profession, we can break down those barriers and make your ambition of trading real.
Trading for a living: two comparable options
Trading from home or working for a trading firm are two approaches to trading for a living. Both require the same knowledge, skills, and dedication, but they differ in terms of resources available and level of risk.
One of the main benefits of trading from home is that it allows you to access various asset to trade and many tools that may not be available through traditional brokerage firms. Another good aspect of trading from home is that you can trade from the comfort of your own house without commuting to an office or other physical location. This can save time and money while allowing you to work at your own pace and schedule.
However, there are potential drawbacks, like the need for your personal capital to invest or the difficulty for novice traders to learn how to analyze markets and properly make the right decisions.
Alternatively, working for a proprietary trading firm allows access to more capital, as well as additional resources can help increase success rates while reducing overall risks.
However, since firm traders are responsible for managing someone else’s money, it can be very stressful and require a lot of discipline and hard work in order to succeed.
Balancing pros and cons, maybe trading from home is a better option for aspiring traders as it offers flexibility and convenience. Any possible drawback could be addressed with the mentoring of a professional trader, just like JTrader.
A few steps to start trading from home
Besides the support and mentoring of a professional trader, let’s see the main steps to start trading from home and turn it into a full-time job.
Understanding the pattern day trading rule
The pattern day trading rule is a set of guidelines that regulates day trading activity in order to protect traders against market volatility. It requires traders who day trade to maintain their capital of at least $25,000 in their accounts at all times. Adhering to this rule prevents traders from buying or selling securities the same day more than four times with unsettled funds within five business days.
Building a trading strategy that suits trader’s goals and personality
Every trader has their own unique personality, goals, and objectives. As such, building a trading strategy that suits your individual needs is essential for day trading for a living. This might include limiting how many trades you take on within any given period of time, or determining which risk management principles best suit your understanding of the market’s various risks and rewards.
Developing an effective trading strategy is simply vital, for any level of trader.
Starting small and scaling up
Starting small and gradually scaling up is an excellent strategy. Starting with smaller trades can provide a great way to familiarize with the market and develop strategies while minimizing the risks.
Scaling up gradually can enable the trader to become comfortable with risk and manage positions more effectively. This approach allows traders to develop experience simultaneously, fine-tune their strategies, and continuously optimize investment returns.
Managing risk effectively
No one strategy or approach is fool-proof, as no one can accurately predict the market’s movements. Then, traders should proactively monitor their positions to assess their performance against clearly established goals and stay abreast of relevant news and market events. By making these elements part of a comprehensive risk management framework, traders can more effectively manage their portfolios while achieving maximum potential gains.
Learning from experienced traders and communities
Getting started with day trading as a living is not easy but taking advice and learning from experienced traders can be incredibly valuable when crafting your strategy and developing the techniques that works for you.
Chatroom, communities and mentoring programs allow beginners to meet people who have already gone through the process and experienced both successes and failures. Such an invaluable resource can help to answer many questions along the way, providing guidance on the most efficient routes to a successful trading career and navigating common pitfalls that occur in various markets.
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Disclaimer: these articles are for educational purposes only. Market analysis, prices, news, trade ideas, or any other information within this site or the chatroom is not investment advice.