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How To Become A Full Time Stock Trader

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A lot of traders who call me to inquire about my course ask me this question after I tell them about the course – “I want to become a full time trader, I want to make trading my profession – is it possible?”.

Well the answer is yes, but there are certain criteria.

1. What experience you have in trading? 5 years or more is good.

2. Are you trading on tips or advisory service? If the answer is yes you will never become a full time trader. Tips/advisory service do not work and will never work in stock markets.

3. What knowledge you have in trading? Please note that this includes all – equity, options and futures. The mainstream trading. If you only invest in equities you can not become a full time trader because equities take time to make money. With derivatives you can make a monthly income, with equities you cannot. However it is very important to invest in stocks for long term as well.

4. Have you made profit trading at least over 10% a year consistently since the last 3 years? If the answer is no you cannot become a full time trader as of now.

5. How much money you have to trade? This I will explain later but with 1 lakh or 2 lakh you cannot become a full time trader.

Now lets get deep into this topic – what is the ideal time to become a full time trader.

Within days of opening a demat account, a trader starts dreaming of becoming a full time trader. Obviously its great to work from home but it isn’t that easy. You must be having some qualities to be a full time trader.

If you look at point 1 I have said that you must have some experience. Just because you have a trading account, you have bought a few options, done some future trade does not mean you can become a full time trader. To know something is very different than being an expert on something.

Assuming you have 10 years of experience but still trading on speculations or tips, you are still not experienced. An experienced person is someone who has the caliber to decide a trade and properly hedge it to insure it from risk. Even after the hedge he has a plan to execute and his success rate it above 60%. This kind of person is called an experienced person. He can have just 3 years of experience in trading but if he has the above qualities he can be a full time trader.

Note: My courses – Nifty & Bank Nifty can teach you hedging strategies. If you are interested you can contact me.

Another important part is risk management. In my experience I have seen that not many traders have any risk management capabilities. Even if you are a good trader you must have a sold risk management in place. Risk management is not limited to trading account only – I am telling about 100% financial risk management. This is a very complex topic, in fact I can write a book on it, but as of now all I am saying is you must have sold money management skills.

Some of the money management skills include:

  • How much profit you are looking for in a trade and what loss you are wiling to take.
  • What measures you have taken to limit your losses or limit your profits. Hedging, manual, system oriented etc.
  • What you want to do with your trading profits? Invest it back into the trading account or invest in long term stocks, or take out and keep in an FD account?
    Note: I take out profits and keep mostly in Reliance Liquid Fund – Direct Plan and ICICI Prudential Liquid Fund – Direct Plan with a Systematic Withdrawal Plan (SWP) as per my monthly needs.

  • Just because you are making money trading are you over-spending on luxuries not required?
  • Are you doing any investment for your retirement planning form the profits made from trading?
  • You can be very rich still you must not trade with money above 40 lakhs. If you have more than this its better to keep them in debt funds. Debt funds give slightly higher returns than Bank FDs and they are safe. They are better than Bank FDs because you can withdraw whatever you want (minimum 500) whenever you want. Unlike Bank FDs where you have to liquidate the entire Bank FD even if you want to withdraw Rs.1000 from it.

    There are other important things that you should know.

    What is your family monthly expenditure? Will you be able to make 20% more than that every month? If not you cannot become a full time trader as of now even if you are making profits.

    Suppose your monthly expenditure for your family is 30,000. Add 20% to it – this is equal to 36,000. So you should be able to make 36,000 pm to become a full time trader to support your family needs.

    With time as your monthly expenditure increases you must increase your portfolio size to make sure your per month profits also increases with needs.

    Note: It may take time to become a full time trader but you have to start somewhere. With my option course you can get a start and start learn hedging strategies and making a monthly income. If now you are losing money its better to stop losing and start making even if its 36% a year. At least after doing the course you will not be going down deep in debt. Once you start making profits you can accumulate more money to make a reasonable monthly income. You can enroll for my course here and let me know. I will start your course the same day you enroll.

    Look at these traders – they were losing money before they did my course but now they are happy they are doing good in trading and their account is growing fast. Some of them like Ravi have become excellent traders.

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    Open ZERO Brokerage FREE Share Trading Account - Buy and Sell Stocks Without Brokerage - Set GTT (Good Till Triggered) Orders on System and Forget

    Traditional brokers charge a lot for brokerage; however, this broker does not charge anything for stock buying and selling. Also, you can set GTT (Good Till Triggered) order after buying a stock, so that the system can sell the stock automatically at your target price even if you are not monitoring the market. Only 25k is blocked for option selling with hedge. Also, you get a lifetime free account in Sensibull (virtual trading app & strategy builder) which charges Rs.800/-+GST a month. It takes 5 minutes to open an account online. Click here and Open Free Account with Them Today >>
  • About the author: Dilip Shaw I started trading stock markets since 2007. However my first 3 years were losses. Then I dedicated almost 1 year on studying, researching, paper trading options and learned a lot in that time. Since 2011 I am trading Nifty options profitably. Call me if you need any help trading options on 9051143004.

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