Is it possible to trade for a living?
Trading for a living is not as easy as standard people may think.
In fact it is much more difficult than those people think and there are not many making a living out of it.
Let us put it other way: 99.99% of those who approach the stock market job do not make a living out of it.
Though, how is trading in the stock markets so difficult?
The main problem, of which I have talked extensively, is the wrong thought that it is possible and not very difficult to make a living doing day trading.
That is not true.
There are many making a living out of trading but not those who you think of.
The guys who make a living out of trading are the brokers and its employees, besides all the other members of the industry who sell some sort of services.
There are not hordes of professional day traders.
It is a chasing ghosts game.
It does not exist.
Anyone who says the contrary is because there is some selling behind it, whether books, signals, mentoring, etcetera.
Selling a course or signals is not bad per se, but it is not ethical selling a course where you tell the guys they will be professional day traders with an average annual return of 50 or 100%.
That is a lie.
You can sell honest courses or signals or you can cheat people.
It is possible to trade for a living
In the case of trading and the stock markets the greatest lie is trying to make people believe they can trade for a living easily.
Therefore, the first thing we should do is to discard day trading as a way to achieve that dream.
If we still feel the rush to do some bets here and there ok, open a very small account and do it there.
If you really want to become someone who trades for a living it is better if you try the long term investment world, although you have to forget about getting millionaire with it in two years.
The long-term investing path is quite boring and long, I reckon.
This path should last many years unless you have a lot of money to begin with, or can put a lot every year so you could build a big portfolio in a few years.
Obviously the more money you have the shorter the time to be able to retire will be.
It is not the same for a person who can put 1000 USD annually than to other who can put 100000.
The first one will never be able to “trade for a living”, whereas the second probably will be.
Trading for a living and the cycles of economy
Other thing to take into account is what cycle we are in.
Here we will not be able to do much but praying to have “luck” and not start investing at the beginning of a depression.
Simply imagine the cases of United States 1929 or 1835, Greece 2007 or 1989 Japan.
In many of those cases we would take too much time to recover our money originally invested, and the process to be able to make a living out of the stock market would take much longer.
Our portfolio would suffer a lot during those periods.
However, imagine we started investing in United States 1950, Spain 1980 or Japan 1960, etcetera.
In those cases 20 years later our investments would be much bigger in value with returns of 15 and 20% every year.
How to trade for a living?
As we have seen, the best ways to trade for a living are: investing in the long term and the activities related to the short term trading: brokers, signals, etc.
None of the paths is easy.
Investing is boring and slow.
The other is like a job, whether you work for a broker or if you decide to give courses as your own boss.