Do you intend to venture into the trading world?
You must have so huge expectations of how you are going to make a living out of trading, right? And you can make a living trading.
But then comes the question of how long it takes to start making that living trading.
Should it take a day to start becoming profitable, a week to become consistently profitable, or a year to become a rich trader?
The first thing to understand before we get any further is that if you expect to get rich quick, then trading is just not the investment you should venture into.
Trading is no lottery or some kind of magic to quick riches.
Meaning, nothing else but establishing objective and realistic expectations from the markets before you start trading, will make sense.
Expectations this, expectations that but how long does it take to earn consistent income trading?
I guess that’s the question that you expect answered by this article.
And as always, I won’t disappoint.
I will show you exactly what you want to learn.
By the end of it all, you will realize how the truth is quite the opposite of what you have been thinking about profit consistency in trading.
It is so important to note that all traders, whether scalpers, day traders, swing or position traders, go through definitive phases in their trading journey.
How long you will take in each phase is a matter of your speed in grasping concepts and learning from your mistakes in each phase.
Which are these phases then? Here we go:
The Hyper Newbie Phase.
This is the very first stage of a trader’s journey.
At this stage, your expectations are too high.
You want to quickly bid poverty goodbye and make trading your full-time business.
You are even thinking of quitting your 9 to 5 job to give trading your full attention.
According to you, you can actually win the best trader trophy if given a chance.
At this stage,
You have read widely, every indicator, oscillator, name it, is on your fingertips.
You know everything about MACD, RSI, Fibonacci, MA, Candlestick Patterns, Price Action Trading, Trend Trading, and everything else to that effect.
Most of your trades are winning and you wonder what the hell was wrong with the person who termed trading difficult.
This will continue until you encounter such a big loss which brings you completely on your knees. Where your account reads zero, having blown it all.
When this happens, you will obviously come back to your senses and realize that trading is not all about those indicators, oscillators, and strategies you had formulated.
It is at this stage that you go to the next phase. Something you obviously would have started doing from the word go, if you did not listen to you your senseless guts.
The Risk Management Phase.
When you hop to the risk management stage, you will probably have blown several trading accounts using several pointless strategies.
This will probably be because nobody ever taught you about risk and money management when you started out.
It is in this phase where you get to understand the significance of managing your money well while trading.
Here, you have time to learn how to position size.
You learn money management strategies such as martingale, anti-martingale, fixed trade size and percentage trading, and the parley money management.
You get to understand how to use risk to reward ratios while setting up your stop loss and take profit levels.
In brief, if you go through all these, you end up learning how to minimize your losses.
The only time you lose is when you break your trading strategy and forget to adhere to money management properly.
But is that all about successful trading?
It is true that your losses will be minimized when you learn how to use money management strategies.
And it is also true that position sizing and all other money management systems used will limit how much you can gain in return.
However good your winning percentage, it may not be enough income to sustain you.
In most instances, if you are not careful about which money management strategies you use, you may end up still losing money or trapped in a system with low returns.
Going through all this trouble opens your eyes wider, into realizing that trading strategy and money management alone, are not enough to make you consistent income while trading.
They just act as a springboard into the next phase.
The Precision Phase.
In this stage, you already know different trading strategies and money generating chart patterns.
In addition, you can apply different risk management methods and profit from most trades.
The only problem is that you don’t get those good results you want.
This is so because you lack some level of precision and an edge in your trading.
You will spend your time acquiring an edge on the markets.
Learning how to predict with precision in different markets is the order of the day here.
How do stock markets behave? What about currency, crypto, index, commodities, metals, and ETFs?
Basically, you want to acquire such kind of precision that at all times, your winners will exceed your losers.
Take an example of tossing a coin.
Every time the head comes up, you earn twice your stake (1:2 risk to reward ratio) but when it’s a tail, you lose just your stake.
You have an upper hand because you have an edge in tossing the coin so that most times, the head will come up as opposed to the tail.
Ultimately, the heads (wins) will have it.
So on your list of prowess, you have trading strategies, money management strategies, and an edge in trading.
You are not off the hook yet, one more phase awaits.
The Business Mind Phase.
You have been through a lot and you now understand a lot about trading.
You know which trading strategies make you money, which money management strategies to apply, and how to apply the utmost precisions to win most times.
The thing which comes with this phase is being business-minded to understand that to make big money trading, you need big money as trading capital.
You invested that $100, $500, and so on, and still blew up the account.
Here, you employ mathematical calculations to establish an ideal amount to start trading with.
You can also calculate how much returns to expect monthly or any other interval.
This is after a proper understanding of all the corners of trading.
It is after this stage when you can begin making consistent income trading.
From the first month after this phase, you realize that you can keep making money consistently out of the markets.
How long it takes to get here depends on how long you took in each phase.
So how long does it take to earn consistently trading? You tell me.