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I am curious if anyone here has had a moment in their trading career where all of a sudden they were making more money than they ever had before, and how they handled it? I've been successful for a bit with trading but recently scaled up quite a bit and am now making roughly 10x more than any job has gotten me in the past, and very consistently.
I really hadn't thought about how I'd handle this situation, but my plan for now is to sit and save while I figure out exactly how to deal with having some real money for the first time in my life. I'm 32 and single, but have always looked at trading as a way to fund the life and family that I'd love to have.
Congrats! It takes a lifetime for a lot of people to reach where you are now!
Since I know personally some people who have reached there, the best advice will be to hire a reputed financial advisor and an accountant as well if you prefer. They can advice you better how to save and invest.
Remember: Save and invest it again for long term goals.
Good job, I told my wife I was going to quit my day job in 2020 (I'm self employed so I really can't just quit) if I was profitable in the 1st quarter. I returned 136% in the first 2 1/2 months, leveraged up my position size and gave most of it back through the rest of the year. I never quit and I'm glad I didn't, but I'm close to that point again, revised some things and using steadfast system discipline I'm up 93% in my account for the year.
Much like your own business, it's trading's lumpy returns that get people down, and trading systems usually give lumpy returns ............ you go from a prince to a pauper and back to a prince, month to month. And it's much harder with a wife and kids to support. You're young use that to your advantage, I had a successful family friend told me in my 30's "You're young, you can shoot for the stars and if you fail, you can restart and retry several times .........."
So my advice to you is ..............: "You're young, you can shoot for the stars and if you fail, you can restart and retry several times .........."
Broker: AMP, ADMIS, Gain, Charles Schwab. Data: CQG, Open-eCry
Trading: Emini ES
Posts: 41 since Jun 2013
Thanks Given: 13
Thanks Received: 25
Just like commission sales... you can have a winning streak, & you can get in a rut. It's hard to get off the bottom if you find yourself there. Markets also change & strategies stop working so well. In other words: SAVE YOUR MONEY, in anticipation of a string of losses or down times. Moreover, things could change in your life, that affect your focus & emotions for a time, & you don't trade so well until you get on top of things or master your emotions.
I had experiences along those lines a few times and it felt great. I made more in 3 weeks trading than I had the entire year at my professional salary. I thought I had cracked the market and I brought more savings into the action. Before long, I wasn't reading the market as well as I had been and my gains unraveled. If you can keep the magic going and get the life you always wanted, that's fantastic. If I were in that situation again and wanted to use the funds to upgrade my lifestyle, I'd advise myself to buy things with cash (not debt) that can be re-sold easily without a high cost of sale or depreciation.
I was trading equities many years ago, took a 5k account to 30k in a month or so. Thought I had it made, then when the market went down I realised (a) that my simple system just tracked the market up reasonably well and (b) that it didn't do anything like as well on the downside and (c) in any case shorting stocks isn't necessarily a smooth process.
Over the next few months I gave it all back, and ended up closing my account before I lost money. So my advice would be to make sure you're consistent over more than one phase of the market, across a range of conditions, and for an extended period of time (measured in years rather than months), before you quit the day job.
When I make significant profit, I take it OUT of the game, not put more in. I would never want the stress of knowing that trading is my only income. Just my 2 bitcoin worth.
“Everything is hard before it is easy”
~ Johann Wolfgang von Goethe
I agree with the sentiment of others, the 1 swallow does not make a summer.
Know that every strategy has a drawdown period and will see rough times.
If you are consistent for a longer period of time and it is going well, the best advicse Ive seen is:
Everytime you reach a certain milestone (eg) you double your account, take 50% of the profits out.
100 goes to 200, take $50 out,
150 goes to 300, take $75 out,
225 goes to 450, take $113
This way your account steadily still increases but youve banked $237 along the way (from a starting pos of $100)
Takeing 0% will be stressful as you consistently trade bigger and wait for that inevitable drawdown
Takeing 100% means your account will never grow
Do all this up to a point, i.e. this applies to accounts less than (eg) $200k,
From 200k take out a higher % etc
