3 Questions To Ask Yourself Before You Start Trading
Many people love the idea of trading for a living. Most people who have never placed a trade in their lives are still intrigued by the idea of becoming a professional trader.
Why wouldn’t they be?
The thought of working from home (or anywhere in the world, for that matter) creating wealth out of thin air is something that gets most people excited.
However, as any professional trader will tell you, it’s not that simple. Trading for a living is tough, and it’s definitely not for everyone.
Below are three simple questions to ask yourself to see if you’ve got what it takes to trade for a living.
Question #1: Are You Afraid of Change Or Do You Welcome It?
This is a big one. If you’re the type of person that struggles to adapt to changes, you definitely should not be trading for a living.
The market is incredibly dynamic and the strategies and tools that are successful today might not be tomorrow.
This dynamic forces professional traders to constantly adapt to changing markets and update their trading plans.
If you’re the type of person that prefers clear processes and little day-to-day change in your activities, then this is not the gig for you.
Question #2: Are You Well Capitalized?
If you want to trade for a living, you need to put yourself in a position for success at the start.
To do this, you need to have enough money to properly trade the market you are interested in.
The market can be volatile, and even professional traders go through periods of time where they lose money.
Your account needs to be ready to handle this type of move while leaving you with enough capital in reserves to stay in the game.
Question #3: Can You Handle A Loss?
This is the most important question. You need to be able to handle losses financially, mentally and emotionally.
You’re going to lose money. It’s inevitable. No trader in the world has a 100% win rate.
To have any chance of success, you need to be able to take a loss and move on without it affecting your next trade.
You also need to be able to deal with short term losses without risking the roof over your head or the food on your table.
This goes back to the question about capitalization. If a losing month is going to keep you from paying your rent, trading cannot be your sole source of income.
Full Time Trading Isn’t For Everyone
Not everyone will be able to answer “yes” to all of these questions.
That doesn’t mean you should never trade.
You just shouldn’t make it your full time job. I believe that everyone should be involved in the market in one way or another. Passive investing is still better than no investing.
Just understand what it takes to be a full time AlphaShark before making the leap – it’s not for everyone, but can be one of the most rewarding jobs for those that make it work.
Either way, learn the techniques we talk about and you’ll trade like an AlphaShark.
AKA, “The Alpha Shark”