how much money do you need to live like a day trader

jefreunde74

Junior member
20 0
hi! folk this is the question
how much money do you i need in my account to day i quit my current job and i start a life a day trader?
please im not talking about the you need 25k to be a day trader for legal reason, i am talking a new job my own job as a day trader
 

NVP

Legendary member
36,448 1,823
I heard about a guy who had a million pounds in his trading account only after just a few months trading ...............trouble is he started with 10 million .....

N
 

NVP

Legendary member
36,448 1,823
hi! folk this is the question
how much money do you i need in my account to day i quit my current job and i start a life a day trader?
please im not talking about the you need 25k to be a day trader for legal reason, i am talking a new job my own job as a day trader
you need years of experience to commence trading real money ......if you don't have that then you will lose it all very quickly full time .........at least trading part time you lose slower.....:cool:


sorry but its a hard hard game and takes a lot of experience, time , training and practice to make consistent money

i'm sure you have this in you ...........but don't take a short cut .....it always ends in failure ...........and don't believe the hype of the vendors trying to sell you stuff.....its all baloney they speak to get your dollars

for example I just pulled 2 live trades out of the hat over here at this forum........... BUT ive been doing this style of trading for 15 years so I need kicking if I don't call a lot correctly .........its just practice practice practice

http://www.trade2win.com/boards/discretionary-trading/180610-intraday-live-short-term-trading-calls-expert-retail-forex-trader-3800.html#post2498710

N
 

jefreunde74

Junior member
20 0
well the focus of my question was to know if for instance i say i have in my account 50k or 100k and i am able to say i can dedicate my life to day trading. or i need an account of 1M to start thinking that?
 

highbury fx

Well-known member
338 114
well the focus of my question was to know if for instance i say i have in my account 50k or 100k and i am able to say i can dedicate my life to day trading. or i need an account of 1M to start thinking that?
its a very difficult to answer as it depends on your personal circumstances. I'll give you some advice based on me making some assumptions about you and your bankroll.

NVP was trying to say don't give up your day job. Try trading part time and at least that way if you do make the mistake in choosing this path as your career you will still have your job to fall back on. If you didn't inherit your money you are doing well enough in your current job to have saved enough money to consider jacking it all in so we would all like to emphasise to you that you must really consider whether walking away from your salaried job is the right thing to do. (its not btw)

That said and assuming you still want to go ahead and trade for a living you shouldn't target more than 3% per month return on your investment.

You then need to decide whether you roll your profits so the 3% compounds each month or whether that is money you need to live on and you will have to withdraw it each month.

If you have to withdraw it each month your slippery slope just got a lot more slippery.

Lets assume you put £20,000 in to a trading account and you make 3%. At the end of the first month do you withdraw the £600 or let it roll and start month 2 with £20,600?

If you withdraw it is £600 enough? if you need £2,000 per month for example then I would suggest your pot size needs to be at least £60,000.

What happens if you withdraw the £600 and in month 2 you lose £1,000 and in month 3 you also lose £1,000. Now you've only earned £600 in a 3 month period and your pot is now only £18,000. If you make 3% in month 4 then you've only made back £540. not much is it.

Alternatively you can roll the dice and use high leverage and scalp and overtrade and do all the things most over awful retail traders do and lose all of it in a matter of weeks.

this is what you should do:

1. keep your job
2. open a live trading account with a good spreadbet company
3. deposit £500
4. trade your strategy and see how you get on. Do not focus on doubling your money but try and make steady returns each day
5. close your account, forget the £500 you've just lost and concentrate on your job again.
6. repeat 1-5 until the penny drops that this isn't an easy route to riches.

I don't mean to be sarcastic but I do hope you realise that any experienced trader will tell you that it is more likely you will lose your money than make money trading. Listen to that advice.
 
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NVP

Legendary member
36,448 1,823
well the focus of my question was to know if for instance i say i have in my account 50k or 100k and i am able to say i can dedicate my life to day trading. or i need an account of 1M to start thinking that?
what I am saying is that just dedicating your life to trading doesn't cut it ......................trading will chose you .......and if unsuccessful (as the high % are) you are back on the streets and bankrupt ......

that's not good
N
 

NVP

Legendary member
36,448 1,823
its a very difficult to answer as it depends on your personal circumstances. I'll give you some advice based on me making some assumptions about you and your bankroll.

NVP was trying to say don't give up your day job. Try trading part time and at least that way if you do make the mistake in choosing this path as your career you will still have your job to fall back on. If you didn't inherit your money you are doing well enough in your current job to have saved enough money to consider jacking it all in so we would all like to emphasise to you that you must really consider whether walking away from your salaried job is the right thing to do. (its not btw)

That said and assuming you still want to go ahead and trade for a living you shouldn't target more than 3% per month return on your investment.

You then need to decide whether you roll your profits so the 3% compounds each month or whether that is money you need to live on and you will have to withdraw it each month.

If you have to withdraw it each month your slippery slope just got a lot more slippery.

Lets assume you put £20,000 in to a trading account and you make 3%. At the end of the first month do you withdraw the £600 or let it roll and start month 2 with £20,600?

If you withdraw it is £600 enough? if you need £2,000 per month for example then I would suggest your pot size needs to be at least £60,000.

What happens if you withdraw the £600 and in month 2 you lose £1,000 and in month 3 you also lose £1,000. Now you've only earned £600 in a 3 month period and your pot is now only £18,000. If you make 3% in month 4 then you've only made back £540. not much is it.

Alternatively you can roll the dice and use high leverage and scalp and overtrade and do all the things most over awful retail traders do and lose all of it in a matter of weeks.

this is what you should do:

1. keep your job
2. open a live trading account with a good spreadbet company
3. deposit £500
4. trade your strategy and see how you get on. Do not focus on doubling your money but try and make steady returns each day
5. close your account, forget the £500 you've just lost and concentrate on your job again.
6. repeat 1-5 until the penny drops that this isn't an easy route to riches.

I don't mean to be sarcastic but I do hope you realise that any experienced trader will tell you that it is more likely you will lose your money than make money trading. Listen to that advice.
nicely put H ...........thanks
N
 

Charlton

Experienced member
1,501 325
hi! folk this is the question
how much money do you i need in my account to day i quit my current job and i start a life a day trader?
please im not talking about the you need 25k to be a day trader for legal reason, i am talking a new job my own job as a day trader
Well to start with the 25k may be relevant depending upon what you intend to trade and via what type of broker.

For US equities, for example:

"Based on FINRA day trading rules, any properly qualified margin account that places four or more day trades within five business days is deemed to be a pattern day trading account.
Pattern day trading accounts must maintain an Account Net Worth (both Beginning Day and Real-time) of at least $25,000 USD. If the Account Net Worth falls below $25,000, trading is restricted to closing transactions only until the account equity is increased above $25,000."

After that work out what you need to withdraw per week to live in the style to which you have become accustomed. Divide the account balance (less 25k if required) by the amount you need to live per week. That gives you the number of weeks before you blow your account assuming no profits/losses.

Now look at your trading history - what are your realistic expectations based on your past trading history ----- You do have a trading history ? Don't you ?

Based on a realistic, fully informed calculation of your expected profits add that amount to the weekly total. Does this exceed the weekly amount you need to withdraw or not ? If not then again you will gradually blow your account.

There is only one difficult thing about this calculation - that is a realistic and NOT a wishful estimation of your profitability.

I defy you to do this !!

If you cannot do it and cannot realistically exceed (and more so - to grow the account) then you should not trade full time.

Simple

Charlton
 

tomorton

Legendary member
7,210 952
£ income per day could be clue to a dangerous way of thinking - psychologically forcing you to trade every day even when your selected markets don't give high probability set-ups for your chosen trading system?

Daytrading is the hardest form of trading and you might be just ramping up self-imposed pressure.
 

richieforex

Member
60 5
hi! folk this is the question
how much money do you i need in my account to day i quit my current job and i start a life a day trader?
please im not talking about the you need 25k to be a day trader for legal reason, i am talking a new job my own job as a day trader
If you want to quit your job and become a trader you need to invest your time and money. There is an opportunity cost involved and that is, you are unlikely to make money for at least the first couple of months.

My suggestion is to learn as much as you can whilst in your job. When or if you decide to quit you will hopefully be fully prepared to start trading (not making money, just trading at this point)!

Then copy someone is already making money. This way you can learn and also potentially make money at the same time. When you are confident in your ability and have refined a strategy to suit you then you can go it alone and hopefully start making money.

Be warned that not everyone has the aptitude to become a trader, usually it is the psychological aspect that let's them down.
 

neil

Legendary member
5,167 744
Deflated hope

HI people. About money....Who can advice to read something about money management, Im trying to understand this issue. Thanks a lot.

@Dick Lexic

You're kidding right ? You are a Vendor selling training Lit. and you don't know the basics of money management. 'Kinell - this site continues to deflate one's hope of further education.
 

5SS

Member
77 0
To be a full time trader you need to have a strategy and you need to understand that.

It is quite impossible for anyone to tell you "You need £x" since no one has any idea how you'd plan to trade (and if you don't either, start there).

If and when you havee a strategy and have back tested and forward tested it over a reasonable period of time, then you could work out your expected to return.

... And then you know how much you need, right?

No.

Then you have an idea of roughly how much you can expect to make a month, quarter or year bu this is no assurance of actually getting it.

To trade as a sole income I would urge you also have back up funds.

DO NOT have one account, split your funds between a few accounts so as not to be overly exposed to any one broker.

Possibly look into other markets to trade in as well as Forex.

Most people who make a lot of money, or even just their living from Forex tend to do so with money management which seriously leveraged earing potential. In some cases you will be paid brokerage commissions and even if there is a losing month you will get some pay.

The good news is, if you can produce reasonable results over 2 years you are head and shoulders above most people and you should be able to make a full time living through JV's - there is a lot more money in Forex than there are successful traders.

So rather than the money, focus on the strategy.

You will understand a lot more about what it takes to make a full time living after 6 months of a strategy.
 

Hedgehog15

Newbie
6 0
@Dick Lexic

You're kidding right ? You are a Vendor selling training Lit. and you don't know the basics of money management. 'Kinell - this site continues to deflate one's hope of further education.
Thanks for your reply. All traders began from nothing. So im just new here. But i want to improve. If you can help somehow you r welcome. If not...thanks for comment. But im sure MM is very important.
 

neil

Legendary member
5,167 744
Misleading Vendor badges

Thanks for your reply. All traders began from nothing. So im just new here. But i want to improve. If you can help somehow you r welcome. If not...thanks for comment. But im sure MM is very important.
You just don't get it do you. Lets try again.
You have a VENDOR badge -yes?
You are selling training literature and spread betting guides- yes?
So -people(potential buyers) expect you to be knowledgeable about the subject you are selling -yes?
Money management is part of trading -better believe it ?

Now you say you are new and want to improve !!

Can I suggest that before selling something you at least learn about it first before getting a VENDOR badge.

Nothing wrong with wanting to learn but it is misleading to show a VENDOR badge to sell something of which you know little.

Surprisingly the Mods have not picked up on your attempting to sell literature concerning a subject of which you are woefully ignorant.

So-remove your misleading VENDOR badge and at least learn and practice your subject before you get a VENDOR badge which leads people to assume you know what you are writing about. In summary -learn your craft before getting a VENDOR badge,