Is it possible to make a living from trading?
That’s the million dollar question, but the answer is simple. Yes, it is possible to make money for a living trading. Obviously, you must focus all your efforts on making it a job, therefore, study, method or trading plan, and discipline. These are the only ways that will lead you to make trading a living.
Tips to make money in trading
Like everything in life, making money in trading is a matter of hard work, but perhaps it is interesting to keep in mind a number of tricks or tips to never lose the horizon.
Eliminate expectations [control of emotions].
Eliminate expectations is the starting point not only in trading, but in any type of activity in which you get involved. Obviously, the main motivation is to make money.
But a common problem for everyone who starts trading stocks is that they set their expectations too high. When they realise that they are not able to meet them, either because of lack of knowledge, lack of time or dedication, or because they did not know how to negotiate properly, frustration sets in.
This can lead to the very negative effect of starting to trade erratically, with no method in place and trying to make money in desperation. Logically, this only has negative implications, as we put reason aside and start moving by the heart.
In trading, we have to work hard on our emotions, as the ups and downs of the markets can test our nerves. It is difficult, but it is something that can be controlled to some extent. So, you have to stop being impulsive and always use reason. And to be able to do this, there is nothing more convenient than training.
Make a trading plan
A trading plan must have, at least, with these elements:
Objectives: Where do I want to get to?
Risk management: How much can I afford?
Tools: What tools will I use?
Making a plan is essential for us to be able to make trading a way of life. It never works without it.
Choosing a broker with a DEMO account
Demo accounts are the starting point for anyone with little or no trading experience. They allow you to trade assets almost in real time, but the money you use is completely fictitious.
Because there is no pressure to trade with your capital, you can trade calmly and with the confidence that losses will not affect you at all.
When it comes to learning how to trade on a demo account, you should bear in mind that you should not exit this type of account until you have a full grasp of how trading works.
So you will be minimizing to the maximum the risks when trading with your money. A very common mistake made by all beginners is to get carried away in haste and abandon the demo account quickly. The effects are often catastrophic.
Types of trading
Trading always has the same basis, trading assets and collecting profits. But depending on the time we spend on each of the operations, we can establish 5 varieties or types of trading.
Firstly, we find scalpers, who leave their trades open for no more than 30 minutes. Day traders open and close their trades before the end of the day. Swing traders can keep their trades open for several days or weeks. Medium-term traders carry their trades over a period of months, and finally, long-term traders open a position and keep it open for several years.
All these profiles have a maxim that is non-negotiable, that of following a method. If this method does not exist, we are entering another realm, that of chance, a scenario that should never be contemplated when trading assets.
Choosing a particular type of trading will depend on your profile, even your personality.
But no matter which one you choose, you have to apply the right method to make profits come your way.
What are the ways to make a living from trading?
Trading can be approached as a philosophy to which we will devote as much time as we can. Some people devote all their efforts there, so much so that they have it as a profession.
Obviously, it would be suicide to go into trading full time from scratch. Those people who take the plunge are the ones who already have experience, and we are not talking about months, trading stocks.
If you are already trading, the balance is positive most of the time and you have more time available, as well as the accounts add up, making a living from trading is a realistic possibility. But never, we repeat, never, take the leap into the void without a net. Never give up a job, which is a secure source of income, to try your luck in the markets.
It is non-negotiable, if your goal is to make a living from it, you will have to spend a lot of time between two waters, combining your work with trading. It is only when you are sure that you have everything you need to succeed that you can dedicate yourself full time to it.
To be successful you have to be extremely methodical. At the end of the day, this is now your job, so there is a schedule to keep. You don’t negotiate at variable hours, you don’t do it without being at your best and, of course, you don’t forget that you have to dedicate some time to training. It is also very important to be able to specialise in a particular asset class.
From commodities to currency pairs, there is plenty of scope to choose from, but remember that “all catching all is not enough”.
Anything that is anarchy, lack of routines and schedules, irremediably condemns us to failure, and will do so sooner rather than later. Therefore, making a full-time living from trading is a possibility.
It is necessary to consider it when we have had enough years of experience and we are setting ourselves the objective of expanding our goals. It is a considered decision that cannot be taken in haste. But don’t forget, you always have to apply method, discipline and study. Anything outside this equation will never give a good result.
We recommend you join NAGA, which offers a DEMO account with $10,000 so you can test your trading skills before using real money: Open your account here
Explore NAGA’s social trading.
CanalTrader.
