It is possible to make intraday trading as a full-time job. However, one cannot guarantee success with day trading.
From statistics, 90% or 95% of traders lose money, and someone might earn only 10% of capital invested per year. Imagine having a $30,000 trading account, how much would be the net income per year?
For example, making $3,000 annually or $250 monthly is not enough for an individual. He cannot buy his daily food. How can he trade?
Is it possible to live on a limited source of income? How about everybody making less than 10%?
Someone earning below that rate is also having difficulty in trading. There is a higher chance that he will risk more than is required.
It is known that traders had blown out their trading accounts because of insufficient capital.
This post argues that intraday trading can be a full-time job, however, make sure that there is enough capital to support living expenses.
Someone might say that he can utilize leverage to increase income limitation. From examining previous experiences, borrowing more funds to improve trading income is risky. Losses are also amplified when using x times of capital.
For example, a tick that cost $1 might increase to $10 per tick with a ten times leverage. Do not forget commission costs.
Remember that it is difficult to achieve 10% income per year, with or without leverage. If anyone is getting that result, he might be a super trader.
It is important that changing a job impacts a person’s life. One can rush his decision because he bought a trading course that promise high win rates.
However, it is known that educators sell trading lessons instead of actually trading themselves. The teacher should be trading instead of teaching if he is already successful.
Anyone can trade intraday time frame, however, can he succeed? Of course he can.
What is intraday trading?
Buying and selling stocks within the same trading day is intraday trading. Open trades are closed before or at the close of the stock market.
Anyone may think that it is similar with a day job. The trader starts to work at the open and ends it at the close. He can choose when to work without someone asking him to do so.
Traders have one problem, though, what if the stock’s price does not move? How can they earn daily?
Read the article on this website to understand the volatility of the stock. The title is “How to measure the volatility of the stock”.
It is an article that shows why liquid stocks do not move that much.
Of course, people can use leverage to capitalize on a 1% or 2% move. Imagine how risky it is.
One may look for stocks that are moving. He can look for stocks that are up or down at least 4% to find possible trade trades.
Try to backtest it with Amibroker, but don’t use the daily time-frame.
It is also known that the stock’s price can affect trading profitability. Higher price stocks offer limited number of shares you can buy. Of course the opposite is true for lower prices.
One cannot trade expensive stocks with a small capital because fewer shares make less money.
For example, 10 cents increase in 100 shares is different with 1,000 shares.
From previous experience, buying more shares has larger volatility that offers more opportunities.
Do not buy expensive stocks if there is less capital.
Current full-time Job
It is important to have a job that can support your living expenses. A trader can never be successful if he depends only on trading.
Imagine that there is no money left in the bank. Start trading to make money. When there are losses, somebody will become desperate. He has got to eat right?
It will now affect his trading psychology. He will eventually forget his money management.
What will happen to a trader who needed money the most?
Traders at banks are quite successful because they do not worry about their salary. They also have a monthly income and bonuses from trading.
If one truly desires intraday trading as a job, why not apply in a reputable bank?
However, they won’t accept unprofitable trader. So, it is important to learn how to trade.
People should understand that it is not easy to make intraday trading as a job.
Therefore, his actions should be to trade part-time with a small account first.
Let’s assume he is a trader with a small account.
How is he going to practice his trades?
Asian people can work during the day and trade the U.S markets at night. Americans may learn and practice from Asian Markets.
Anyone can understand that trading requires an understanding of supply and demand.
It is the same in all markets and will always be. How someone trades it is a different story.
One can learn stock trading outside regular working hours. He can learn from his mistake if he records all his trades. How else did successful traders learned?
One tip is trading away from the Commercials. Be like a bank that provides liquidity to them.
People can trade intraday as a job as long as they have enough capital to support their living expenses. Practice and trade outside working hours, using other countries’ financial markets. Trading is always the same and trade like a bank.