Before you start to trade, you need to establish goals in terms of how much time you can devote to trading. Are you going to trade on a full or part-time basis? Always keep in mind, as with any business, the more time you can devote to the business in the beginning, the better the business will be.
Many traders I know spend the entire day in front of the market. They are glued to their monitors from one to two hours before the opening bell until well after the market closes in the afternoon. They take advantage of every profit opportunity offered during market hours. I also know many traders who work other jobs and trade two to three days a week. Their style takes advantage of trades that take two to six days or weeks from start to finish. I’ve even traded with some hot shot traders who only trade one to two hours a day and make a fortune doing so.
O.K, now that you’ve decided how much time you can devote to trading, here are a few more questions to consider:
How many trades do you plan to make each day. Three or fewer? How long do you intend for the position to be open? Six days or possibly six weeks? How much time do you intend to devote to “homework?” As much as possible with no intention of doing it 24/7? Do you plan on focusing on trading after work and on weekends?
If you answered yes to the questions above, you are a part-time trader. This style fits most of the trading population. Most folks have a full-time job and three and a half kids at home. Time can be limited and, realistically, there is only so much time in a day. We all know that unless you devote some extremely focused time to trading, it can get very expensive. If you are fortunate, and can focus every hour of everyday on the market, the following tendencies would define a full-time trader:
You will be in front of the market every day. From before the open until after the closing bell. You will also know when it is best not to trade and sit on your hands or step away from your machine should market conditions so dictate. You strive to execute and manage your trades with workman like precision. Your goal is to make fast profits, sometimes being in trades for only a few seconds.
You study more than you did in high school or college and love hearing those magical words from your spouse as you duck into another book store, “Are you going to spend more money on another stock trading book?!” and your objective is to trade stocks for a living.
The lesson is to establish your goals early and your ability to focus will be much clearer and easier.
You will be in front of the market every day. From before the open until after the closing bell. You will also know when it is best not to trade and sit on your hands or step away from your machine should market conditions so dictate. You strive to execute and manage your trades with workman like precision. Your goal is to make fast profits, sometimes being in trades for only a few seconds.
You study more than you did in high school or college and love hearing those magical words from your spouse as you duck into another book store, “Are you going to spend more money on another stock trading book?!” and your objective is to trade stocks for a living.
The lesson is to establish your goals early and your ability to focus will be much clearer and easier.
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