Do You Wanna Trade Stocks Full Time or Part Time
There are professional traders who trade stocks full time and seasonal or part-time traders who buy stocks & keep them for sometime. Depending on your financial goals & time commitment, you should consider the right option carefully. Whether you’re trading full time or part time there is risk involved on losing all or part of your capital investment, so having a regular job or a business of your own to minimize any future risk when you’re just starting in stock trading is a good idea.
As a full time trader you can either become a short term trader by buying stocks and selling them within days/weeks or aday trader that buy & sell stocks on the same trading day or hour. Day trading needs longer time commitment & stock price pattern studying. Short term traders also called swing traders are between full & part time traders. Swing traders don’t have to buy & sell on the same trading day or even same week. They usually pick stocks using technical analysis & other financial measurements and then wait for a short time to sell them for profit. If the stock price decreases within days or weeks then it will be sold and the capital will be used to buy a different stock.
The opposite of swing trading is long term trading which is a little safer investment then short term trading but still has high risk. In long term trading, investors will have a portfolio of selected stocks from popular companies. To maintain their portfolio investors either hire financial brokers or buy mutual funds that are already managed by financial companies. Long term stock trading is suitable investment for retirement.
Another important factor to consider when selecting between part & full time trading isthe initial capital that you are going to invest in the stock market. Although stock prices increase (& decrease) highly, the profit will greatly depends on the initial capital invested.
For instance, if you invest $5000 & we assume that you profit 15% average monthly then your total income before taxes is about $750 which is a great return on investment but any minimum wage job will be better than this. In contrast if you invest $100,000 & you only profit 7% average monthly then your total income is 7k for the month which is better than many high paying full time jobs.
So, by knowing your level of risks, time commitment & the initial capital that you are investing, you can successfully plan the type of trading commitment that suits your lifestyle.