Working as a trader is something that everyone really wants. Many people want to be a successful trader and relax while enjoying the results. However, everyone is confused about where to start to work as a trader. Here I will discuss how to become a trader from home.
Becoming a full-time trader Knowledge is everything in the context of trading. When you leave work to trade full time, you no longer have the security of a regular income. This means your attention is often focused on making profits from every trade to pay the bills.
Some Tips to Become A Successful Trader From Home:
Becoming a full time trader is a good decision. You will get to know how the market works, also if you become successful you can set an example for those who fear trading.
To become a full time trader you need to gain high-level knowledge and experience. You need to have the capacity to face losses at times. You need to have that much capital to trade full time.
To gain knowledge you have to read books. You have to read articles on the internet. You can also watch videos and blogs on the internet. You have to learn from any source possible. You cannot just decide and start investing because investments come with risks. Therefore if you have knowledge you will be able to make correct decisions while trading. You can read articles of famous investors like Rakesh Jhunjhunwala, Warren Buffet, etc. You can refer to websites like investopedia and also Sharekhan Free Articles.
Experience matters. If you have experience in these investments then you will be able to choose the correct stock. It’s okay if you make mistakes at first . Learn from the mistakes you make. Search for reasons why you lost in that stock ? How much is the loss and also about it’s past. At first start investing in small stocks then once you gain confidence you can invest in large stocks.
Never bring emotions in between. Do not trust anyone, do not be greedy.
You can ask for expert advice from fund managers but do keep in mind that they can make a mistake sometimes so you can trust them but do not completely rely on them.
You can research market conditions and invest. Keep in mind that if a certain stock is doing good in the market that does not mean that it will do good the next time also. The market is volatile so you never know what will happen.
Never follow the herd mentality. If everyone is investing in a particular stock it does not mean that the stock will do good. The price may fall even if the stock is popular. Invest only where you feel to invest.
Checklists before you quit your current job
Below are the lists one should look at before they quit their current profession to take Trading as a full-time career.
If you have a monthly commitment (EMI) towards any loan, this will add extra pressure in your Trading career as you have to generate this commitment amount every month. Sometimes, there will be no opportunities in the market, or if you fail to make money in the market, extra pressure will be created in your mind, which impacts your trading decisions.
One should save enough money to run the family for at least one year. Suppose if you need Rs. 1, 00,000 (or 2000 USD approx) per month to look after all the expenses in your family, then you have to save Rs. 12, 00,000 (or 24,000 USD approx) before taking trading as a full-time business. This amount is excluded from your Trading capital which you required for your trading. In this case, your trading results will not impact your mindset, and also you will not get any emotional pressure from your family members.
Trading looks very simple when a beginner makes some quick money. However, one should realize that the market conditions are always dynamic, and it requires enormous skills to make consistent money in the market. So it is better to measure our trading success before we take the extreme step. It is a good idea to consider yourself as a successful trader when:
- You make at least six months of your current salary from trading profits in total
- You make profits for three consecutive months in Trading.
Only the above parameters are insufficient to quit your current job and jump into Trading. One should have adequate Trading capital to make profits in the market. Suppose you can make 10% returns every month (10% per month is the good returns as per any trading expert). You need minimum Rs. 10, 00,000 (or 20,000 USD approx) as your trading capital if your monthly expense is around Rs. 1, 00,000 (or 2000 USD approx).
Convincing your family
The most challenging part is to convince your family. Because they will lose the luxury of sharing these statements, “My son is working in Infosys” or “My daughter is a Team Leader in Microsoft” with their friends and relatives. Besides, you can’t guarantee monthly returns from trading, and hence, they may not agree with your plan to take Trading as a full-time profession. However, one can follow the below ideas to convince their family members:
– Keep a trading journal along with the statements from your broker. Show them the consistent profits which you made in trading
– Explain your plans for your trading career. Show your savings and tell them you will be able to run the family for one year, even if you don’t make any money from trading.
– Buy Term Insurance and Health Insurance for your family members. Explain to them if something goes wrong, these insurances will take care of you and your family members.
– Explain your passion is Stock Market, and you will be happy if you opt for trading as a full-time career. Besides, also explain to them that you will be able to spend more time with your family members.
One of the most significant advantages and disadvantages of full-time Trading is ‘You are the Boss’ to your work, and you don’t have to report it to anybody.
Usually, we are used to the ‘Reporting’ style of work, and this freedom may work against you if you don’t have serious trading plans and goals. One can keep the below things in their mind when they become a full-time trader:
– One should not take breaks in the trading days for any reason. Because opportunities may come at any moment, and one should be ready to grab these opportunities on all trading days.
– Your laziness can cost you dearly in the market. Trading is your business, and you should be prepared like a businessman before the open of the market. You have to finish your exercise, meditation, bath, etc. before looking at the market open. If you are unable to concentrate on the market at home, hire a single-seat desk in any office
– All successful traders maintain a ‘Trading Journal’, and hence it is a good idea to log all your trades with Entry, Exit, SL price, etc. You should review these trades on a periodical basis and evaluate your trading skills.
– Usually, in all other professions, we will have an environment. However, in Trading, it isn’t easy to have such a situation. Hence, one should develop a circle of good traders and should be involved in monthly gathering, etc. If possible, attend the major events on Trading like Trader’s Carnival, seminar conducted by experts, etc.
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What You Need If You Want To Become Full Time Trader ?
All that I need to do this is a PC, an Internet connection, and a brokerage account. You can actually use a phone but it is much more tedious than a PC due to the small screen and less easy data entry.
TD Ameritrade has good free online education on how to trade.
Reputable firms for trading include Fidelity, Vanguard, Schwab/TDAmeritrade, ETRADE and a few others.
TDAmeritrade also has a good free paper trading tool so that you can practice what you learn before you start trading with real money.
Search on Google and downloade PDF and then read about trading. First you need to decide that Wich type trader you want to become forex trader or stock trader.
Then based on your decision Download the PDF read hardly and open a demo practice daily what you are learning. Apply your knowledge on your demo and and try to make your own trading system.
When you will feel better about your trading then go real…..enjoy you trading life nest of luck.