Identity crisis when switching to full time trader
I am interested in knowing traders' experience when they switched from wannabe/part-time/hobby traders to Full-time or Professional traders. I am planning to do the transition over a period of about 12 months from now.
I assume lot of members here had some sort of past-life NOT related to trading and wondering how they managed the transition and the barriers they faced.
We are all aware of the monetary and practical benefits of being a Full-time trader. Hence I am going to ignore that part for the sake of this thread and focus on the difficulties or negative aspects of the transition, particularly the emotional and psychological ones.
The following user says Thank You to Narcissus for this post:
I haven't made the leap yet, but I've thought about it a lot as it is my goal within the next few years. One of the things that I've thought about a lot is finding a way to not feel guilty for all the extra free time. So you kinda have to keep working to get better, without screwing up what already works for you, I think. Be your own boss, guide yourself and congratulate yourself and discipline yourself.
The following user says Thank You to DrewDown for this post:
Years or swing trading profitably part-time, followed by years of well paying job to amass enough capital to afford to fund trading accounts and afford to not take a paycheck for a while.
I would recommend you have a long run as a profitable swing trader before going full time into futures.
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The following 9 users say Thank You to Big Mike for this post:
I don't care if it's trading or being a salesperson or rocket scientist.
It's 20% practice and 80% psychological.
Whether you think you can or you think you can't - You're right!
There are SO many hurdles to overcome psychologically.
Do you like risk? or Are you risk adverse?
Do you get your significance from your career?
What happens when you get into a slump?
Are you fighting with your spouse?
Are your kids on drugs?
Are your parents coming back to live with you?
All this ON TOP of doing something that's really - really hard.
You have to have a really BIG "why" Big enough so that it will provide the persistence to carry you through.
And you need wisdom - so you don't go broke.
My best suggestion is to UNDERSTAND inventory.
Where is your competition going to want to get out of their trade.
I mean UNDERSTAND it - through and through - the same way Tom Brady understands a defense.
Put Hours in looking at moving charts and moving DOM.
SIM or live - either one - But put in hours to understand what is actually moving the market.
Why did price stop there?
Why did price race from that area?
Why is price just staying in that range?
If you understand that - You'll have a good start
The following user says Thank You to Barnacle Bill for this post:
Favorite Futures: ES, fine alcohol and muscle cars
Posts: 394 since Apr 2013
Thanks: 803 given,
As a part time trader with a career there will be several things.
Routines - I will need to establish a new routine.
Friends - A lot of people at my workplace are friends. Will have to have time for clubs, etc. To stay social and not turn into a hermit. I do jits and judo so that helps, but may need some creative or social club to stay well rounded. Maybe a salsa club or similar.
Screen time - Half of my screen time is actually otj, it is usually interruption free, when at home I get interrupted way more, I will have to be more strict on office hours. Maybe an off site office.
Insurance - you will need medical insurance which is costly
Cost of Living - consider moving to reduce initial cost of living to be abe to absorb more set backs
Exercise - I exercise on the job. I will have to get exercise.
I actually am going to stay in my J o b atleast 6more years. I will have enough years for early retirement. That will allow me to collect medical insurance. It will also allow me to grow my accounts and skills while keeping a safety net of the j o b income. I'd like to grow my trading accounts to 250k with in the next 6years this will give me enough size to keep risk low and live comfortably.
The following user says Thank You to KahunaDog for this post:
I have been trying to become a full time trader for a couple of years now..and am only recently starting to show some consistency.
The most important thing I think one has to do is view their results in an extremely objective, realistic manner. Believe me, it is very easy to be delusional in this endeavor. It often happens after someone has a little streak of winning trades for a few weeks. All of a sudden, the fantasies of being a great trader making untold amounts of money start taking over one's mind. Of course it's always good to think positive, but you have to have a firm grip on reality at all times.
I, unfortunately wasn't able to do that for many years. I thought I was "ready" in the past many times..when it became obvious I was not. Looking back, I had no long term live profitability to provide any kind of statistical evidence that I was proficient at trading. Still I deluded myself ..perhaps because of ego ..or maybe even "magical thinking" that I was good. Now..I may have had the essence of a system, but did not have the psychological tools or emotional discipline to even follow it's rules or methodology. And I learned the hard way by losing close to $100k in my first 5 years of trading. It's painful for me to face that...because I wasn't able to come to grips with the fact that I was foolishly trading large sums of money without ever having proved I could even do it.
So after many tweaks to my system and years of conditioning myself to strictly adhere to it and all it's rules 100%, I am finally making the progress that I once believed I could. If I could go back, I would have proved myself on 1 contract for many months before trading larger size.
Hopefully, before you transition to trading full time, you will have many months of positive metrics that demonstrably show..you have the required skills to do this.
Failure is not an option
The following 5 users say Thank You to lancelottrader for this post: