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To trade or not to trade

We have lots of folks that have watched our YouTube videos with an eye towards wanting to learn more about trading. One form of residual income or ways to generate income from home is by trading your own money. This is different from investing where typically you are buying and holding for longer than 5 years. Trading is where you keep an account mainly in cash and you wait for setups in the market to take place based on your trading research.

A friend of mine from college went to work on Wall Street and learned how to trade energy, specifically natural gas. Since that time, he only trades one thing, natural gas. Natural gas also happens to be one of the most volatile assets in the marketplace to trade, which, if you know what you are doing, have discipline and stick to a system, it can be very lucrative.

The key though is that he stays focused and only trades with what he knows and has been trained in. Trading takes a special kind of persistence and self-awareness. Like anything you want to excel at, it takes practice. The tough part is practicing in trading can be expensive because you’re not practicing with play money, it’s real.

In order to obtain this kind of practice, our philosophy is that you need a supported environment to learn and be mentored in. Further, you have to do your own research and practice, practice, practice. Trading is emotional and you need to trade with fake money for months before putting your own money into play.

Another way to get confident in your trading strategy is called backtesting. Backtesting is the process of going back in history to see how your trading strategy would perform in the past. The more backtesting you can do, the more you can understand how your strategy performs in different kinds of markets. This is not an indication of the future, but it will help you to gain the confidence you need.

Once you are confident and feel like you are ready, trading can be fun and easy, more now than it has ever been because you can make money from the comfort of your home. Once you understand your process and have backtested it to see how it would have performed, you can literally profit from anywhere in the world. It is not passive in the sense that you are not doing anything – quite the contrary. It takes a lot of practice, skill, and attention but once you learn what you’re doing, it can be a great way to generate income without working for someone else. Between futures, foreign exchange and cryptocurrency markets, you can literally trade from anywhere in the world, 24/7.

The four keys to trading are:

  • Finding a platform that you are comfortable with
  • Having a mentor teach you
  • Backtest
  • Practice.

This is a skill that has to be developed, practiced and refined. You have to treat this like your profession. Practice with fake money and do your own research. Building wealth independently takes time and skill and we are here to help.  Let us know if this is something that you would be interested in learning more about.  You can contact us here.