planetkill 

If you're confident in your ability to make money, and the only thing that is holding you back from making a lot of money is time and small account balance, then why don't you borrow as much money as possible from banks? Max out credit card cash out offers, unsecured personal loans, etc. Is your return higher than the interest?

ninjus 

Yeh don't do that.

planetkill 

I don't see why not. Isn't trading with other people's money the most common method of funding trading? A hedge fund using mostly other people's money blows up, and the managers face reputational damage. You blow up with the bank's borrowed money, and you face the same thing in the form of bankruptcy. If a trader is consistently profitable, and has 100% belief in their edge, and the only thing holding them back are the years required to grow their small account, then I don't see why using leverage in the form of other people's money a bad idea. Specifically in OP's case, they have very little assets. With little to lose, it seems the upside is much greater. Again, only assuming they are consistently profitable already, which OP writes towards the end.

Well, it's one way to do it, but it's also pretty much the way to ruin. It puts far too much emphasis on being able to consistently profit, and it puts a trader in a terrible position, both financially and emotionally, if they have setbacks. It's also trading with money you can't afford to lose, always a bad idea.

I did not understand from the OP's post that he is consistently and reliably profitable. I know he closes on an optimistic note, in a way at least, but not exactly saying he's killing it. He thinks his trading will be good "in the long haul." Not quite the same.

He's not a hedge fund. He's a guy with few assets and a job that isn't what he wants in terms of income and trading that isn't doing it either. Ruinous debts and/or bankruptcy will set him back years.

Now, if we assume a high enough profitability we can justify anything. If someone had that high a profitability, I don't think they would have written this post.

By the way, I have, in the long-ago past, borrowed a lot of money during a time when I was very successful in trading, and then lost it and had to go find a job real fast. The markets change, and how confident you are in your edge doesn't stop the markets from changing and doesn't get the bills paid.

Important decision-making like this needs to have enough reality to it that you can withstand things not turning out the way you planned.

Bob.

I agree with what you're saying related to OP.

But in terms of bankruptcy in general, I think it is a very powerful tool that few people use.
I believe that when you have very little, using whatever credit available to you (for the purposes of generating income, not for expenses) has more upside than downside.
I know several very successful people now that declared bankruptcy in the past, moved on to their next job, and were able to quickly grow their assets without the baggage of debt service to their previous failures. Some of these people lost everything from being over leveraged in property in '08. Others went deep into debt from their small businesses failing. In all of these cases, strategically using bankruptcy enabled them to get back on their feet much quicker than needing to pay off their debts. I think of the interest on a loan as the premium for optionality to default.

I even personally know one person that using multiple LLCs that they owned, transferred most of the credit from the LLCs into their personal accounts. They ended up declaring bankruptcy, and walking away with over $200k. I think in cases like his, intent matters alot. Although this person set out to take these loans without the intention of ever paying them back, he got away with the fraud, and its already been many years since. I obviously advise against doing anything that is illegal, but just sharing another example of where bankruptcy was used as a tool, and not just a last resort failing.

Back to trading and in general, borrowing money can be good if it's being used to generate income. If it's being used for expenses (pay for losses), it's bad. Your point about the market changing is however very valid, and an additional risk we take on.

I wonder if this is what famous futures traders like Paul Tudor Jones meant when they said they reduce their trade size when they're in losing periods. Is it because the market changed, and they need time to adjust their strat to the new market?

bobwest 

Well, it's one way to do it, but it's also pretty much the way to ruin. It puts far too much emphasis on being able to consistently profit, and it puts a trader in a terrible position, both financially and emotionally, if they have setbacks. It's also trading with money you can't afford to lose, always a bad idea. I did not understand from the OP's post that he is consistently and reliably profitable. I know he closes on an optimistic note, in a way at least, but not exactly saying he's killing it. He thinks his trading will be good "in the long haul." Not quite the same. He's not a hedge fund. He's a guy with few assets and a job that isn't what he wants in terms of income and trading that isn't doing it either. Ruinous debts and/or bankruptcy will set him back years. Now, if we assume a high enough profitability we can justify anything. If someone had that high a profitability, I don't think they would have written this post. By the way, I have, in the long-ago past, borrowed a lot of money during a time when I was very successful in trading, and then lost it and had to go find a job real fast. The markets change, and how confident you are in your edge doesn't stop the markets from changing and doesn't get the bills paid. Important decision-making like this needs to have enough reality to it that you can withstand things not turning out the way you planned. Bob.

Hi! I rarely comment, but I think there are some similarities between us so decided to share.

I am also 31, working nights to trade in the morning, single, but don't feel lonely.

Around 7 years ago I was in a unique position (to majority of people) where I had some money to pay the bills for a couple of years, and decided to devote all my time to trading. I traded European and first half of the US session. I was looking to get funded by a company, so didn't worry about my trading capital. But I also got married and thought, having a university degree, worst case I would find a part time job or just start a regular career if my plans didn't work out. My partner at the time had different ideas, apparently, and after two years she left. Of course trading with a time pressure on your results is not the best idea and psychologically it was tough, but I can say I did my best with what I had and have no regrets now regarding my effort. The personal life part and the conclusions I made about those events obviously pertain only to my own circumstances. But I see that that's where our views differ and possibly why I found a way to continue my trading pursuit and maintain a satisfactory life outside of the markets.

What if "sacrifice" is not the right term to use in your situation. Everything has some price we have to pay if we want it. People rarely think this way because the majority follow more conventional paths. But you always give up something, whether it's your time, sleep, ambitions or simply things you could be doing alternatively. What do you really want, what are your priorities? Is it possible to have a family while trading? I guess. BUT! You have to be honest with yourself regarding the lifestyle you may have, and, importantly, also be honest about it with the person you choose.

My view on "trading for a living" is that it's just not worth the risk. I love the markets, the challenge and the skills I've learnt so far. But one of my main takeaways after almost 10 years trading is that you just cannot rely on the consistency of your results. Whether you trade for yourself or for a company, you are only as good as your last month/year. It is what it is. I accepted it. I structured my life in a way that it doesn't depend on my trading results, neither financially nor on a personal level. And if I have a good year in the markets - it's just a bonus. In my opinion, people who insist on a different approach either lack experience or want to sell you something.

You probably feel there is a gap between the expectations the world we live in places on young men, and the best life you see for yourself. At least I did. Maybe your inner conflict is not trading specific, but in any case you are the one to resolve it. In the meantime, here are a couple of random ideas I wrote down for myself after reading "Manuscript Found in Accra". Some of those are quotes and some are just my personal notes:

Only he who gives up is defeated. Everyone else is victorious.
-Wait patiently for the right moment to act
-Do not let the next opportunity slip by you
-Take pride in your scars

Goals:
1. Self-trust
2. Truth
3. Tolerance
4. Mastery
Because ever since your goal found out that you are traveling toward it, it has been running to meet you.

Grateful for:
Family
Health
Vocation
--
There are a couple of online resources that helped me to get through the darker times. Let me know if you are interested. I wish you to find peace with whatever you choose for your future and persistence to follow through with the necessary steps!

@zetsurin

I just wanted to thank you for your post, and also point you to a couple of other threads that may help.

Time to Give Up I get a lot of emails and PM's from people seeking advice. Usually they've been losing money and don't really know what to do next. But I received a particular letter recently that made me want to write this post. What are some of the characteristics …

Support from wife/kids/loved ones in your trading I'd like to talk about the psychology of having/not having support from your wife (and kids) in your trading business. First, notice I used the word business. Trading is a business! If you run it any other way, it's just gambling. From students …

They've been long running threads in the community and have a lot of insight.

Mike

zetsurin 

Is it worth it for me to continue this dream?(long post, non technical related question) For anyone/trader who will take the time to read my experience, I appreciate it as this is the first time I share my personal life on the internet because I am depressed. Should I continue trading and chasing the million dollar dream? I grew up with a trader father, and all I ever heard from his mouth growing up was money, and the markets. He was rich and went broke when I was 8 years old. He was so confident in his skills that he was sure he would someday bring us back to the more comfortable side of life. Naturally, hearing nothing but trading, combined with growing up living in poverty and immense stress for a teenager, I decided then, I would do it for myself because I don't belong in this impoverished neighbourhood. Fast foward from the space of age(25-30) I have made every single sacrifice possible to save money and keep retrying. I lived in the hood, I never bought a car, I finished university but still decided to work only night jobs to be available for the volatile mornings. I havent gotten a girlfriend because I dont have confidence that I wont let a family go through what I went through, even though I am desperately lonely. All that just to maximize my savings in order to keep funding an account. I havent lost much, but I haven't made much gains either so far. At age 31, I have no friends(close friends), no confidence to build a network( I dont even have a car), no girlfriend obviously, when I look in the mirror, I am decent looking, and healthy, and good with women. But why am I in this predicament.. that eats me away. My father is sick, and gave up his confidence in trading. I have my trading method, but my motivation is 20% of what it was 4 years ago. Mainly due to my age, and the desperate desire to have human relationships (Even though I tell myself its sacrifice, it's mostly shame of my living environment). Please share your opinions, should I keep trying until I am 40? I have 30000 ish in savings, buying a house in cash and creating a happy family is a dream I share with many people. However, I don't know how risky it is to devote my next decade to hardcore trading. I might end up in the same situation, or slightly better by 40 if I do pursue this. If I quit, I probably will have to join the debt prison and take out loans like people to start a life. In return, I have someone to hug, but I will never be wealthy. I am confident in my trading skills over the long haul, the P&L will be positive and continue to magnify, but currently, I am 31, and alone, with a sense of regret of the people I sacrificed to do this. Because I haven't succeeded. Please share your thoughts if you were in my shoes, would you keep chasing this million dollar dream. I can't express my gratitude for those of you who spared your time to read. Thanks

You are obviously in a very difficult predicament but hopefully you will be able to see the light and make the right decision.
A few points that you make stand out:

1) It sounds like your dad was a very successful trader and then seemed to hit hard times. It doesn't seem like he was able to recover from his misfortune - this just illustrates in no uncertain terms, that the markets are unbelievably tough to make money in AND to keep on making money in them long term. Your family has had the privilege of seeing both sides of the trading equation, but your lasting impression appears to be one of hardship and failure.

Do you want to subject yourself to this possibility at anytime in your life? I don't think, by reading between the lines of your post, you really want to trade. You don't seem to be obsessed with the markets or have an over arching passion for trading - which I believe you have to have, in order to be successful in the markets, long term.

2) You seem to want to trade to prove that you can do it successfully - this will not result in success. Trading markets as a means of earning a living is the most difficult "job" any human can undertake. Markets result in undue stress most of the time, even when one is able to successfully trade them. From your own description, you are depressed. A depressed mind CANNOT trade markets. PERIOD. NEVER.

3) You really want a partner in life to share your life - all the ups and downs with you. You need to concentrate entirely on that now, and work at a normal 9 to 5 job. This should be your first and only priority at this time. If you try and then introduce the stress of trading into a developing relationship - both your relationship and trading will suffer. Don't do it. Look after you domestic situation first and if you still have a "desire" to trade when you are settled, then revisit trading.

Find some type of social club or ask friends or relatives, or join a dating site, or or or... find yourself a partner.

4) I do not see any direct evidence that you have a great trading strategy with a real edge that could allow you to reach your financial million dollar dream (you say " I have my trading method"). If not, that will take you years to develop and there would be no guarantee that you will ever reach the heights you hope too.

Based on the mere tone and doubts you express in your post, my personal opinion and advice for you would be:

1) Don't consider trading right now, put the entire thought on the back burner. If, at a later date, you feel the passion to trade, then explore it at that time.

2) Spend whatever money you have saved and what you might be able to earn in a normal job, on getting yourself established and a little more secure. This will bring you some happiness. Buy a house, a car or get a dog or cat or whatever - just sort this part of your life out first. Then you can consider other aspects, like possibly trading.


Try and find a therapist to work through your depression with you - you might find it is all totally reactive depression rather than endogenous. This dilemma of yours wanting to trade but not really wanting to trade, is messing your mind up.

If you decide you want to trade later on, the markets will always be there chewing everyone else up and spitting them out!! You can at that time, decide if you want to join that game too.

You have some tough decisions to make, but I wish you the best and hopefully you can see your way through to the right solution without too much more stress and heartache.

All the best to you.

I don't know if you'll become a successful trader or if you'll be able to start a family or have a home.

But I do know this: You can transcend your circumstances. You don't have to believe me, but do take action to get out of your rut. Keep pushing through the setbacks.

You are not your father, the poverty and loneliness you are experiencing. The past only repeats itself when we allow it to. Don't let it.

I had no confidence at all. I still have insecurities, but I am honest to myself about what my shortcomings are and patiently work through them. From the very bottom, I was able to build self-respect and dignity, which have nothing to do with how much money you have in the bank. There were tons of people who hurt me either deliberately or otherwise, but I kept going. The process was awkward and full of hardships, but almost no one has it easy. There are possibly millions, maybe billions of people who aren't doing as well as you.

31 is young. You have plenty of chances. Even if you are 100, you still have a chance to do something different, if only changing the way you perceive yourself and the world.

As for trading, you are in the right place; this forum has plenty of resources and members willing to share their knowledge. As far as forums go, people here are quite nice compared to the bloody awful online groups out there.

Examine what's not working in your trading strategy. I.e. If you're not good at money management, take classes and learn. Your dad didn't recover because his ego couldn't accept he screwed up. Instead of facing what he could have done better, he kept dreaming and living in denial; kind of like my dad.

Be realistic in your abilities as much as possible. Find a mentor. Do what it takes to improve. It is tangible action that will take you to where you want. Take small steps everyday. Think about how to secure small gains consistently rather than dreaming about "making it big." Have a mindset of a trader, not a gambler. A trader sees risks and danger, but a gambler can only see the limitless illusion of what money can buy.

In psychology this is called "cry for help" :sos:
My honest advice is to leave trading behind at least for a while.

You need resources to trade. Not just money but mental, emotional charge.
Lack of a supportive circle of friends is a major drawback in life, not just in trading.

Moreover, it could happen that you can become way more successful in some other area than trading. Please consider this!

You can get back to trading anytime in some days. But this is not like winning the lottery.
You are young and you might need to mature yourself and develop skills before you get ready to trading.

What does trading worth without a meaningful life?

Keep going but choose your direction wisely

This is not your dream. It is your father's dream.

Even if you succeed in trading, you MAY still not be happy, since this MAY not be what you really want.

How can you ever be happy if you do not have a person to share your happiness?

If I were you, I would stop trading and ask myself: Who I am? What is the real source of pain in my life? What do I really want?

Have you thought of trading other styles? Seems like your only day trading.

I am saying this because I am in a similar position as well. But truth is that, unless your only day trading, looking at the charts isn't going to make you richer, it's letting winners run that will make you richer.

So rather than giving up, why not realign your trading goal and life goal? So let's say you want a life and want to trade as well. Have you considered doing swing trades across afew days or weeks such that you only have to spare an hour a day on daily and have a day job, which then allows you to add more money to your account and compound it faster and you won't end up in the debt prison as well. You would probably get to where you want much faster. Plus it gives you free time to find a partner too.

Just that you have to be trading alot further out in timeframe and maybe be trading other instruments.

Hi zetsurin

In my humble opinion money in itself can never be more important than human relationships and interactions. We are flock animal and need the closeness / interaction with others to thrive.
Even if you made a ton of money who would you share it with ? Isn't it in the sharing with others that we gain the most purpose in life, in my understanding and experience it is.

Furthermore I would "work" with the emotions you are "fighting" with before I would start throwing money after the markets, it could be you even figure out that this "dream / nightmare" of becoming a wealthy trader is something you have been taught by your father. Again in my experience if we do not get conscious about ourselves and the behaviors/programs we execute on automatic you could try to live your life on ideas you have been taught/inheritted by others (mostly parents).

Unfortunatly many times it takes a strong emotional loss ( not money) before we start to introspect and see that we are really not following our own guidance but the preconcived ideas of others or the society.

In regards to your age, you have the whole life before you, I would propose that you start really working with ourselve on a emotional maybe even spiritual basis and maybe let the trading be trading until you are more in balance. The market will still be there in a week, a month , a year. I know this can be difficult because we continiuisly are reminded that everyone is making a killing in the markets, and we are the only who are not and that, at least for me, turns on the FOMO big time, but everyone is not making a killing, it is just seldom that they tell on any social media channel how bad it really is and how many really make it big.

Look at all the trade journals here on futures.io to get a more "clean" picture of how people are struggling and I think most people in here are even better off than the "normal" retail investor.

I would be happy to point you in directions that have helped me with getting more clear about who I am and what I want. PM me if you are interested there is nothing to buy all the ressources are free.

All the best to you.