Going full-time with your personal trading operation obviously has its attractions. Aside from the perks of being able to work in your dressing gown with your favorite mug on your desk, full-time trading offers the possibility to make massive quantities of money with very little effort! If you’ve been trading on the side for some time, and you’re thinking about quitting your day job to go full-time, here are some crucial questions to ask yourself first…
Is Your Account Large Enough?
If your trading account isn’t large enough, you’re going to have a very hard time making the leap to full-time trading. When you’re assessing the state of your account, you also need to take your historical performance on board. How much money can you really generate per year through trading alone? After pinning down these important figures, you can work backwards to figure out how large your trading account needs to be in order to support yourself on it. A big part of successful trading is dealing with the unknown. While you may have a proven track record and a fairly large account, you’re going to have months where you simply can’t generate any income at all. With this in mind, it’s highly recommended that you set up different accounts for your saving, spending and trading.
Are You Well Equipped?
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While you may be able to manage your part-time trading fairly well through an app on your computer or smartphone, if you want to go full-time with it, you’ll need to have a proper set-up. The main investments here are likely going to be several monitors and an upgrade to more comprehensive and responsive trading software. However, the largest and most important cost you’ll need to account for is a new trading computer. Modern PCs and Macs can help you get by when you’re trading on the side, but purpose-built trading computers are essential for anyone hoping to make trading their full-time source of income. If your computer has limited screen space and struggles to run the platforms you use, it’s time for an upgrade. You can learn more here:
Will You Have to Withdraw Every Month?
Take a moment to think about the way you structure your trading account, your savings, and your personal spending account. The frequency with which you withdraw from your trading account often limits how much it can grow. If you’re making $5,000 per month through trading alone, but you’re withdrawing $4,500 a month just to maintain your comfortable lifestyle, then there’s very little wiggling room for growing your operation in the future. As you’ve probably heard before, compound interest is the holy grail of trading, but if you’re making withdrawals too often, it can minimize the positive effects of compounding interest massively. If you want to assure a lot of exponential growth and let your capital work for you as efficiently as possible, you need to be able to leave your trading account alone for fairly long periods of time. You can find out more here.
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