Becoming a full-time trader is something that a lot of people aim for, it is the main goal for a lot of people, to get rid of that 9-5 job, to get out from under that boss from hell, but a lot of people who eat it, are not fully prepared for what is actually involved in it. Going full time is a huge step and it can put you under a lot of pressure, the pressure that you didn’t have as a part-time trader due to having other sources of income or not needing to rely on it.
We are going to be looking at some of the things that you need to think about in terms of your mentality if you are planning to become a full-time trader, you may already be doing some of them, or maybe you aren’t doing any of it yet. What we hope is that this can be used to give you a better understanding of what is yet to come for you on your journey and also some of the things that you will need to think about before you decide to ditch the job and go full time.
Are you actually ready?
This takes a few different things into consideration, firstly, do you have enough money to survive? Remember, you will be relying on the income from your trading for everything, what would happen should you not make enough? Do you have enough capital and reserve funds to survive? Think about your bills, the rent, mortgage, food, car insurance, Netflix, and everything else. If you were to not make any money one month, would you still be able to afford all of this? The recommended amount to have saved up is at least 3 months living costs, if you have less than this then it could be looked at as not being ready to pack in the day job, you need to have enough available should things go south and you don’t make any money.
It is also important that you have enough capital to actually trade at the level that you are required to. If you are required to make $3,000 per month, then if you have an account balance of $1,000 it is just not feasible or realistic. You need to ensure that you can SAFELY make enough each month and to be able to survive any drawdown that comes with trading.
You need to be mentally prepared to have to stop doing certain activities that take away your finances, it is fine for months where you have made enough, but on those where the income is a little lower, you need to be prepared to make sacrifices and knowing this beforehand is vital so things do not come to you as a shock, there will be times where you need to sacrifice things, it will happen, so be prepared.
The other thing to think about is your recent results, or at least the past 6 months of results. It is all well and good having the last month be a good one, but one profitable month does not mean that you will be able to be consistent. We need to look at the past 6 months or so to ensure that we are profitable. If you have not been, if your average for those 6 months is below what you need, then you are not yet ready to go full time and you are not quite ready to support yourself fully just from trading.
Setting Realistic Goals
You need to be able to set yourself some realistic goals, as a full-time trader you are relying on this money and the income that trading creates. When you are trading as a hobby, it is ok to say that you want to make a million dollars, but that is not realistic when trading full time. It’s great to imagine buying that dream car, but let’s not forget that you also have your bills to pay, so your first goal simply needs to be to make enough to sustain your own lifestyle, not a new one, the lifestyle that you are currently living right now.
Your goals also need to move back a little bit, you won’t be going for such fast results, you now need to be more careful with your trading, so that new car may need to take 3 years instead of 1 to achieve, this helps you to keep things a little safer and will keep you trading for a long period of time. Set your goals realistically based on what you have been trading before, not what you want to be trading in the future.
Are you willing to change your lifestyle?
Are you one of the people who loves going out in the afternoons, or have a busy family life, well unfortunately things will need to change. While it sounds great having no boss and being able to work when you want, that does not mean that you won’t be working a lot, and we mean a lot. Some full-time traders work far more hours than they would with a normal full-time job. You need to be able to set yourself hours. Unfortunately, these may not always be to your liking and may need to be set based on the strategy that you are using.
This also means getting rid of potential distractions, if you love your Playstation, then are you able to trade for hours at a time without being distracted and wanting to play it? If not then it will be hard for you to stay dedicated and more strict scenarios may need to be put in place like getting rid of it completely. It is not easy to stay concentrated on trading, both subtle and big changes may need to be made to your lifestyle.
Are you able to treat trading like a business?
Often when people start working from home they start doing it in their pajamas, they start to get slack with their wake up times and so start working later, and later, this won’t work with Forex trading. Trading is such a disciplined task and job to do that you need to be able to treat it like a business. You need to be getting up in time and starting work at the same time, you need to show it the respect and education that it needs and you need to be able to act as if you are at a job.
So those are some of the things that you need to be able to consider should you decide to go full time, it is an easy choice to make, most would jump at the opportunity, but it is important that you understand the consequences and requirements of trading full time. If you are prepared, and your strategy is ready, then good luck, it is a difficult journey ahead of you but it is certainly a rewarding one too.