Most forex traders don’t rely on trading as their sole source of income. They use it as an investment alongside their regular jobs. Are they missing out on turning professional? Or playing it safe?
James Woolley advises you not to rely only on forex trading. In his great article, Woolley mentions that market conditions can change and your systems may not work anymore.
He also states that relying on forex trading might put pressure leading to a loss of discipline and to hasty positions.
This can lead to a catastrophic chain of events because if you are relying on this income to pay your bills and give yourself a reasonable standard of living, then you may find yourself losing your discipline and taking more and more risks in order to become profitable again. This in turn will generally lead to even more losses.
So, his advice is to diversify your sources of income, and not live a stressful life, that can risk your assets.
Not risking everything all at once sounds very reasonable, especially if you’re new to trading. It can be very irresponsible and dangerous. But after some time, you usually improve at what you’re doing.
So perhaps dedicating more time to trading might make you an even better trader? As James mentions, discipline is the key. If relying on trading makes you nervous and causing you to make to irrational decisions, well, it’s not for you.
But if relying on forex trading for a living means that you trade better because you have a responsibility, then maybe it’s worth exploring this opportunity. Dedicating more time, all your work capacity to trading, can turn you into a better, more balanced trader.
You do need to plan it carefully and not risk anything you can’t afford to lose. But if you do it responsibly, perhaps this is the career that has been for you.
Further reading: 5 Points on When to Go Pro
Are you a professional trader? Did you ever explore this option? What do you think?Get the 5 most predictable currency pairs