Trading is simple but not easy! you can buy or sell in just at the click of a button, but what to buy and when to buy is a difficult ball-game altogether.
95% of people who opt for trading eventually, QUIT!
Keep these questions in mind before losing your capital.
1. Do you have a robust trading strategy?
To be a successful trader, you need a robust trading strategy with a statistical edge — Something that is thoroughly backtested & works in most of the market conditions.
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Let us take the example of Casino, make billions every year.
Casinos don’t beat players because they are lucky, but because the odds are in their favor.
By introducing 2 green pockets, they enjoy a winning probability of 20/38 viz a player’s winning probability of 18/38.
The richest and best traders in the world aren’t trading their own accounts to pay the weekly grocery bill and monthly rent they are managing billions of dollars to grow their clients capital over the long term.
The best traders in the world are under pressure not only to make money every month but also must keep their clients satisfied with their performance.
These top traders not only have to beat the market returns but trade in markets with enough liquidity to execute.
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These traders are in the major leagues of the markets and are rewarded for it. Maximum pressure, big trading size, and clients that demand results monthly and yearly. They are also entrepreneurs as they run firms and manage employees.
Trading for a living is a professional endeavor like any other. It requires a large amount of capital to go full time like other business & the returns are irregular much like being a commissioned sales person.
It is less about trading from a lap top on the beach with a Lamborghini in the garage and more about taking on the risk, managing the uncertainty along with the stress and being rewarded for good trades.
There is no regular paycheck, there are losing weeks, months & years.
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1. You have to purchase medical insurance as you have no employer plan
2. You will be your own boss so you have to make yourself do the needed work of research, screen time, and trading
3. The lower your living expenses are the less you need to make to trade for a living.
3/9
From low earnings in the initial phase of our careers to higher expenses post marriage, the reasons are many that we fall back on. What little we save often ends up either in just the savings account or at best an FD even for years together.
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We do end up getting our collective acts together later on when concerns for our childs future or a drying up job market force us to think seriously about investing But is there a cost to investing later on in life, rather than earlier?