Are you interested in trading in the stock market?
Do you think that trading in the stock market can help you in generating more income then your regular income?
These are couple of questions one need to ask themselves when they consider the stock market as their full time career option.
But before taking this decision one should remember that there are a lot of risks involved in this career.
This is mainly due as nobody could predict the market scenario and you may also incur huge losses by investing in the stocks.
But before you choose the stock market as the full time career, you should have the following skills to make it a successful career:
Knowledge about the working of the stock market is required by the traders are planning to make the stock as their full time career.
The stock market is a vast subject and there are many different aspects of the stock market that traders should know.
Full time traders should know about the different types of products that are traded in the stock market such as stocks, options, currencies, commodities, etc.
They should have in depth knowledge about these different types of products.
Traders should also have knowledge about fundamental and technical analysis of stocks that is required for analyzing the stocks.
Fundamental analysis is done to find whether the stocks that you are holding are cheap or expensive according to their intrinsic value.
Technical analysis is done to predict the future price movements of the stocks by using various technical tools like indicators and chart patterns.
Thus to be a successful trader and take stock market as full time career, one requires thorough knowledge about these topics.
For successful trading requires focus as well as discipline which many people usually do not possess.
Successful investors are those investors who invest in risk investments and take the benefits of compounding by growing their wealth over years.
For this the investors require focus to monitor their investment and discipline to sell these investment products when they achieve their target and before that.
Traders who like flexible working hours are not suitable for this career options.
As the full time trading required discipline trading plans and work schedule. They need to sit in front of their trading screen and monitor the prices of their stock constantly for that focused is required.
When a successful trader reaches their profit target they close their position without any greed or temptation of booking more profits.
If the price goes against their expectations then the successful traders reduce their losses and close their position.
- Mentally Prepared:
Successful investors leave their emotions out of trading.
One it comes to choosing stock market as the full time career options, traders should be mentally prepared for the losses that they will incur from trading.
Traders can reduce these losses by choosing such the appropriate trading strategy that minimizes losses.
They can also balance these losses by making profits from other traders.
Successful traders learn from the mistakes and losses they incur when trading.
For this reason, traders should be mentally prepared and leave their emotions like greed, fear, temptation out of their trading.
Thus for the traders who want to make the stock market as their full time career need to be calm and patient.
Traders need to set aside capital for buying the shares for starting trading.
They should usually set aside atleast one year of their income to start their career in trading.
This fund should now include their living expense such as food, insurance, house renting and so on.
Traders should also not borrow funds for trading thinking that when they start making profits they will return back the borrowed money.
What happens if they start making losses?
Then how will they return back the borrowed money.
This traders who want to start trading as their full time career should have capital with them for trading.
- Good Trading Setup:
Lastly, they should have a good trading setup for trading.
They should have up-to-date soft wares that will help them in monitoring the prices of the stocks and also help them to be informed about the financial news that affect the prices of the the stocks in which they are trading.
Above are some of the basic things that the traders require to make the stock market as their fulltime career. If the traders can master the art of trading then they will enjoy the independence as well as the financial rewards.
Sakshi Agarwal is a post graduate from a financial background. Her favorite topics of interest to write about include technical analysis and investing. She is currently working at www.elearnmarkets.com as a research analyst.