Question:
Hi Trader Ed. I really enjoy your column. I have a question for you.How does one make the transition from having a job and trading on the side to trading for a living?
I trade equity credit spreads and have been making roughly 3%-5% per month. I never take my profits out of my account. I have a trading plan that thus far has served me well, and I stick to it. My plan is to either generate two years of living expenses before I make the break or take a longer but even more conservative route and pay down my mortgage before walking and firing my boss, the latter taking 5-7 years in my estimate. I realize there isn’t a cookie cutter answer that applies to everyone, but I would love your insight.
Angel from Heavenville
Answer:
Angel, my answer to you is you don’t need me to advise you. You are doing it. In fact, you should be advising others who harbor the same dream. Your strategy sounds thought-out, well-considered, and solid, whichever route you take. Go for it!
All you folks out there take a long look at how Angel is approaching the business of trading—he is treating it like a business. And just as one in business would devise a business plan, one should do the same for trading. This is the lesson for the day, kids. Now, for your homework, read Chapter Three, Trading As a Business, and re-read and discuss Angel’s plan for his move to trading for a living.
Trade in the day; invest in your life …
Trader Ed