I would like to know if there is anyone here who is making a living with most of their income coming from trading activities?
If yes, I have a question:
[B]Do you set yourself how many pips that you need to get in a month to survive, with continuous new trades being placed like a hedge fund manager? Or do you allow your income to vary from month to month based on trading environment?[/B]
Because I assume that there would be quite a lot of pressure on personal financials if trading is our sole source of income- which could drive us to make bad trades
I think that it can only work if one accepts that income will fluctuate from month to month - the market varies, obviously, so any income that is tied to that market also has to fluctuate. I think for any genuine pro it is pretty unlikely that there will be a losing month, and it is pretty inconceivable that two or more losing months would be strung together, so what one would really get is simply varying profit.
Assuming that a pro trader is still doing things like paying a mortgage, it is just a case of making sure that any regular payments on that, cars etc. don’t exceed a ‘worst case scenario’ income level. Assume something like a 2% return, with one flat month a year, if the numbers work on that basis then it can work. If a 15% monthly return is necessary just to cover outgoings, I’d suggest that the timing is wrong in terms of going pro.
Most pro traders will either be a) allowing for some income to be held back to enable compounding to improve the longer-term financial picture or b) have reached a point where cashflow renders compounding unnecessary. Either way, there is a healthy margin built in, which hopefully means that trading income can fluctuate month to month without negatively affecting anything important.
Just my thoughts - everyone will have their personal finances structured differently, but that is my take.
My plan to leave a day job involves having at least 1 years current income set aside in a non-trading account (be it cash, gold, other), and to have my worst month’s return in the last 12 be at least triple what I need for expenses.
This will ensure I don’t damage my trading returns by failing to follow my trading plan due to financial stress, and that there will still be a significant amount for compounding.
At this point I will be looking at other investment areas, be it commodities or the like to keep the mind active.
I only set limits on losses, profits are whatever they are, and income varies quite considerably. Its no different to any other business that I’ve ever run, you really need adequate cash reserves.
Hi every One
I am in need of an urgent review. I need best Forex signal provider urgently, I did some research on that and find hundreds of websites, so i select a few and contact them and by doing this i got a lot of calls, emails from the websites to take their services, and got confused I know there are some free signals providers also but i am looking for more professional and the company that deliver the signals in real time.
I select one but not sure, so i need experts help
this is the link which i select Forex Trading Signals | Forex Broker | Currency Trading | Fx Renew
Please help me urgently
Urgently? Seriously, this is not urgent, that is not a word I would associate with Forex if I wanted to be successful. Much better to put in your own research, steadily, into how to trade. Even if you do think that pegging your finances to a signals provider is a good idea - many on here would argue that it is not - nothing about Forex responds well to being hurried. Urgent is when you have broken your arm and need a doctor, or have been robbed and need a large friend to chase the guy down. Looking for a signal provider and considering it urgent is just going to cost you money, imho.
And to answer your question, I have heard of many traders trying signal providers and none has been successful over even the medium term, let alone the long term. If you are going to trade signals you might as well put your money into a managed fund and let a pro trader make calls and trade them all as one package.
Signals feel like a short cut, and I never heard of a short cut that worked in Forex. Particularly not one that you find in haste.
Thanks Simon for your calm massage I understand but I am a busy person not have enough time or sit the whole day in front of laptop don’t you think it is a good idea to go for a signal provider as The purpose of Forex signals is to reduce risk factor and I think Forex signals is a good way to understand the predicted trends what do you say?
I think Simon was very politely telling you a signals service will decrease your risk. Your risk of being successful as a forex trader.
Sitting the whole day in front of a laptop is unnecessary, some traders do well on as little as 15 minutes a day - but only after they have already mastered the art. You cannot expect to be wildly successful long term without the initial learning.
You’re welcome, I always try to be constructive, that’s when the site works best. I absolutely hear you on time being a premium - my wife and I both work (Mrs Templar in a career job), plus we run two businesses, plus we have three small children and do the childcare ourselves (we’re both based at home, mostly). So I get that time is difficult for most of us. However, at least with Forex if one makes the time then it gets easier to manage. As Cyco says (requoted below), trading can happen on remarkably little time invested per week once one is up to speed, so it is worth going without much sleep for a year or two, imho. I did all my trading this morning, based on a one hour scan, made a decent return and this afternoon am not trading at all - yet making a good monthly return at it. End of day trading is also a low-impact option that can work well.
Anyway, I am rambling, back to your question: personally, I do not think that signals can give you an understanding of current or upcoming trend, as you would not know the strategy behind the signal and not all traders trade with the trend. Many trade ranges, or countertrend for instance. So taking a signal from someonedoing that and assuming that it gave you an indication of upcoming trend would be a mistake that led to other mistakes. I like to be a trend trader, but I also have other arrows in my quiver - this morning I made 1% from a range strategy on EUR/CHF. I happened to be short that time, but had I given you that as a signal and you assumed that I was thinking that the market would head south you would have been misreading me, as I was trading just above the level that is to be defended by the SNB, so I was trading a tight range and not a trend. I also trade counter-trend, sometimes, a reversion strategy, which I think is fine as long as one understands where one is in relation to the market.
I am not saying all of this to dampen your enthusiasm, but I am saying this: personally, I would not trade signals, I would invest my own time in my own research and then, when one comes out the other side of the initial, afterburner phase of learning, one has a skill that can bring in a good income on very flexible hours/location. However, if you do wish to persist with taking Forex signals, do not expect to learn from those signals. Treat each signal as an opportunity to make or lose money, but do not think that by reading things into the signal you will be able to draw wider conclusions about the state of the market and therein find a learning shortcut. I just don’t think that it would work that way. If it did, we’d all do it…!!
I’d have to agree with every word of that, well said.
My plan to become a full time trader is very similar to this plan. I will be aiming to grow my trading account over the next few years and at the same time putting aside a portion of my salary kept separately from my trading account for now and a another portion going towards an emergency fund. The plan is determine how much monthly income I will need to survive and the average monthly returns I have been able to achieve and from that determine when I will be able to go full time. If i can make 5% a month and would like say $5000 a month to live on, then when my account is equal to 100,000 I can think about going full time, but having the emergency fund is essential because after all there will be losing months etc.
Your retail broker or most, give signals on trends and which pairs are best to trade. Since a retail Broker is not an Interbank they rely on there signals they receive and the knowledge of there traders. It probably won’t be as good as an Interbank. So the signals lag. Some FX traders use the news and shows like Bloomberg to give them clues as to to which way the markets may be headed.
I did personal experience that full time trading is much profitable than doing part time , Because full time traders can avail all good market moves. They can judge well market timing according to their amount and trading style . Specially in beginning it counts a lot to give much time to trading and market watch.
Hello to the Original Poster; while I understand that everyone is different, the ‘full time trading’ question has been asked many times before: here is a recent thread:301 Moved Permanently. There are many other threads like this, so it may be worth doing a search for them and I bet my bottom Euro/Dollar/Pound that most answers will already have been given… Just a thought…Cheers.
I have been trading full time for about a 3 years now. I worked very hard to get to that point though.
I started trading when I was 20 (now currently 25), at the time I was a full time tree surgeon. It was hard fitting trading into my life at the time because of the hours I did with my full time job. So I set income goals from my tree work, each week I would save like a boss till I eventually got myself a 10k trading account, I knew how to trade successfully, it was just not financially beneficial with a small account. Once I had a 10k account I went part time so I could be at home more, with the money I made from my part time job to pay for my living expenses, my trading account was growing faster as I was able to to have larger trades and didn’t need to make loads of pips to get a good return. When I reached 20k I decided to move out of my parents. My next goal is to have a 100K trading account by the end of this year then I am going to start a tree surgery business as a hobby to set a new challenge.
I used strict money management and I stuck to the rules no matter what my emotions were telling me, these rules met consistently leads to long term success. I never risk more than 1% of my account per trade. RiskvReward ratio of 3-1.
