Anyone with ambition and an internet connection can stick their foot into the waters of trading for a living.
More often than not, people can begin trading with very little money and a lot of patience. Sounds too good to be true, right? It is possible to earn a full-time income from trading, but it’s not easy.
When it comes to day trading, there are a lot of options out there but it does take time to learn about them. People have to be prepared to put in the time and work to see the benefits of trading for a living.
What You Should Know About Trading for a Living
Trading for a living is possible, however, it’s not easy money and does require a lot of work. Some people find that they spend more hours trading than they did at their old job.
This may be the case, but many benefits come with trading that makes it all worth it.
Once you start doing more research on making a living by day trading, you’ll notice that there are a lot of people claiming to have made some big money from day trading. They will probably even drop a number that sounds way too good to be true. There is no such thing as easy money.
The Pros and Cons of Trading for a Living
With every career, there are pros and cons. Trading for a living has a hefty mix of both, so before taking the plunge it’s important to determine if the pros outweigh the cons for you.
While some people may see a lot of potential through trading, others may see too much risk.
Pros of Trading
- Be Your Own Boss: One of the biggest perks of getting into day trading is saying goodbye to your boss for good. No more unrealistic demands or catering to someone else. Trading also gives people the freedom to work how they want with no limits on how much they make.
- Make Your Own Hours: The beautiful thing about trading is that it’s open 24/7, which means people can work when they want for as long as they desire. Instead of planning their life around work they now get the opportunity to plan work around other commitments.
- Cut Back: Most people do trading from home, which means that they can cut back on a lot of costs associated with going to the office. People no longer have to worry about the costs of transportation, which was a big relief, especially for people who take the bus. Clothes, coffee tips, and takeout lunches are just a few more things people can save money on.
- Stay at Home: Did you even like the office anyway? A lot of people prefer to work from home. Instead of feeling trapped in a cubicle, they now have the freedom to bring their laptops to their bedroom, favorite sofa, or even their balcony on a nice day. It’s easier for a lot of people to meet their deadlines without distracting coworkers around anyways.
Cons of Trading
Although many pros make stock trading sound like the perfect way to make a living, it does come with its fair share of drawbacks.
- Very Little Social Interaction: One thing to remember, even though those coworkers may be distracting, they do provide you with some social interaction. Some people have found that the change of routine is rather lonely and regret the choice once they are alone 24/7.
- Regular Pay: With a regular job, there is usually a consistent salary. Employees can always expect a certain amount of money on a certain date. Trading is completely different because there is no stable salary. Some people may think they’re doing amazing one day because they make over $1,000. However, the next day they could lose well over half of that amount. There’s always a financial risk.
- Complexity Abounds: Bots and automated systems are starting to take over this market. Many traders are always on edge worrying about how they are going to adapt to so many algorithms. It’s hard when the competition isn’t human but even harder knowing it’s challenging to re-enter the workplace if things fail. People who have experimented with trading find that they have a harder time finding work again after.
What You Can Trade
Now, that you are aware of the pros and cons, it’s time to take a look at what you could be trading if you decide to follow this path.
Deciding what to invest your money in is one of the most important decisions to make during this process. These are the most popular markets and securities for traders:
- Stocks
- Penny Stocks
- Cryptocurrencies
- Forex
- Eminis
- CFDs
- Futures
- Commodities
- Gold
No matter what a person chooses to trade, the volume and volatility have the most crucial impact on the overall profits. It’s important to choose one that is highly volatile to see good things happen.
This is one of the more challenging aspects to figure out, but it has the potential to make a decent earning.
Although people can start trading with very little money, it’s not necessarily the best idea for everyone. Losses can occur, especially for people who are unfamiliar with the market. This can be very devastating, especially if a person doesn’t have any capital to fall back on.
In the beginning, try to consider markets that require less capital. Pay attention to different currency markets to be aware of all the different options available. Some foreign markets often require lower barriers for entry, which could be ideal for someone who wants to start low.
How to Start Trading for a Living
Trading may be difficult but once the ropes are figured out the risk is well worth it. There are a lot of obstacles that will come your way, but with the right tools and mindset, you can overcome them.
Luckily, not very much is required for setup. You will just need to make sure you have:
- A computer or laptop with an internet connection
- A reliable broker
- A strategy
To see success in this market, your strategy will need to rely on charts, proven patterns, and technical indicators to make a profit frequently.
It is also important that you take some time to do risk management before you decide to start.
Your capital before starting is important too. At one point in time, it was unrealistic for a person to begin trading for a living if they didn’t have $25,000 to start. They also had to always maintain that amount. However, since then the financial industry has completely changed making it easier for anyone to start trading.
The very best way to make sure you succeed is to stay on top of your education. There is a wide variety of resources out there, so make sure you utilize as many as possible to stay on top of everything that is changing in this market.
Last but not least, make sure you have a plan for stop-loss and take-profit. Always know ahead of time the price at which you will sell a stock and take the loss to avoid holding on too long. On the other side, know when to take the profit and sell before it’s too late.
Conclusion
Trading for a living is a very risky business, but anyone patient enough to learn how this market works could potentially see a great profit from trading. For an example, watch this video from Clay Trader.
The number of people making a living from trading and achieving financial success is increasing each year. There will be some bumps along the way and trading isn’t right for everyone. However, those who do it right have been able to make a decent living.
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