Whether you are tired of your day job or want to pursue another field for the freedom it offers, trading can be a very enticing career. Whether it is in forex, equity, commodities, or any of their respective derivatives, it is not impossible to take up day trading or swing trading as a full-time career in today's world.
However, taking up full-time trading isn't as easy as quitting your job and opening your trading account. Trading full-time should be treated as a serious business. There are a few pros, cons, and requirements to keep in mind before deciding whether full-time trading is a career meant for you.
Advantages of being a full-time trader
The biggest advantage of being a full-time trader is that you are your own boss. You are working for yourself and you will reap all the benefits of your success. This is the kind of freedom most aspiring full-time traders love about the job.
And since you are in charge of your career, you can choose to work whenever you want, and take a break or a vacation at your convenience. Also, as a result of the technological advancements in this field, you can work from anywhere in the world and all you will need is an internet connection. This allows the trader to use the rest of his/her day to pursue any other hobbies or passions.
Apart from these benefits, a good trader can easily make more income in 30 hours of trading a week than he/she would have in another corporate job.
But if it were that easy, wouldn't nearly everybody be trading full-time?
Disadvantages of being a full-time trader
Contrary to a comfortable corporate job, full-time traders do not have the luxury of having a fixed and guaranteed paycheck every month. Whether these traders earn money or not is totally dependent on their performance alone, and this can cause a lot of stress and force irrational trades.
Trading full-time in itself can also be a very lonely profession unless the trader takes part in online forums for discussions. Usually, there aren't any colleagues, co-workers, and co-founders to interact with in your trading journey. Although this subject to the individual and the way he/she would like to proceed, this field is unlikely to have many collegial interactions.
Now, if you are excited by the pros and have made peace with the cons, you are nearly ready to take the plunge. However, before that, it is important to know the requirements that you should expect from yourself before you give up the cushion of a monthly salary for your trading career.
Requirements before being a full-time trader
Having a cash reserve is the most important criteria to judge whether you can survive trading full-time. Most experienced traders suggest having a cash reserve for at least a year or two kept aside, apart from your trading capital and a separate emergency fund, before you enter trading full-time. This is extremely important, as a bad trading session, week, or even a bad month will not put you under pressure to generate profits immediately; and even in scenarios like this you can take a few days off and see where you're going wrong in your strategy instead of feeling the pressure to cover up the losses.
Another important piece of advice given by experienced traders is to have another source of income apart from trading. Apart from the 9:15 am to 3:30 pm you'll spend trading, it's useful to be able to generate another source of income (either active or passive) to support your trading.
And the most important requirement, without a doubt, is that the trader should be genuinely passionate about trading, and not get into it just for the money. If a trader is trading just for the money, he/she is bound to lose his/her capital and give up sooner or later. This passion should be followed by intense hard work, practice, and discipline, just like how one gets successful in any other field. The true secret to success in trading is not the discovery of a magic indicator, but in the simple principles of hard work, practice and discipline.
If a trader feels he/she is not up for the task, then there is no shame in that either. Getting into trading full-time takes a massive leap of faith and there is nothing wrong if a trader takes his/her time to learn the art while keeping his/her job. However, if a trader feels he/she's ready to take the plunge into full-time trading, the feeling of contentment in this ride is going to be unparalleled.
Happy trading :)