Things To Consider Before Trading Full-Time in 2024 (Don’t Quit Your Job)

Many traders want to take the leap and go full time. Being a full-time employee while your real passion is trading, can drain your energy. It’s frustrating because your mind is elsewhere: the dream of freedom, independence, and becoming wealthy while you are working from wherever you like. No commuting, no boss, no 9-5 stress.

But is this really doable, and if so, how likely is it?

This article covers things to consider before trading full-time. Unfortunately, very few make it as full-time traders. Even though your passion is trading, you should trade part-time for many years before you quit your job. Most traders fail to make any money at all, and the pressure of having to make money easily becomes a burden.

Below are some aspects you need to consider:

How much money do you need to trade full-time?

First things first. You most likely need a considerable amount of capital. Not only do you need capital for your daily trading, but you need capital to cover your living expenses for many months. Why? You must prepare for having long periods where you have no trading income, even prepare for losses.

Most money managers get money thrown at them if they manage 12-20% annual returns. Warren Buffett has become one of the richest men on this planet with a 19% annual return. This puts things in perspective. If you manage 15% per year you can calculate yourself how much capital you need to cover living expenses and profits.

Of course, you can use leverage and increase the returns, but this can just as well backfire. Leverage requires caution and a good business plan. All strategies have drawdowns, and you might risk never coming back if leverage magnifies the loss.

Why do you need 25k to day trade?

If you have a retail account and want to day trade you need t