Hi guys Andrea Unger here.
I’m asked sometimes if this is possible and I normally state how hard it is to become a trader and how difficult trading is, how dangerous it is.
So you might be surprised now listening to me saying that yes I believe that part-time trading is possible!
But what do I intend with part-time trading? For sure I don’t mean coming back after a full day of work sitting in front of the computer and start scalping the Forex a couple of hours in the evening.
I mean, it might be possible for somebody, it might be a source of income but to do so you need probably a specific talent with not everybody has.
So don’t think about this solution, also because sometimes, in the evening of Central European Time, Forex does not move the right way to allow scalping.
Somebody could now claim I’m an idiot, I don’t know forex well, it’s my opinion of course, but that said it’s also very hard to do such a thing in addition to the necessity of a specific talent because after a full day of work you are probably tired, physically, mentally or both and to do something that needs a high level of concentration is not always the easiest thing to do.
Considering also that this would probably waste your personal life because you would have less time to dedicate to your family to your friends to whatever you should dedicate to just to have a proper mix in what you do.
So you know I don’t consider scalping the right way to trade, just because I said it requires something inside that not everybody has and which is very difficult to teach and to learn.
So what kind of activity could be used and put in place to trade part-time?
Basically I believe that some swing trading or short-term trend-following strategies could be put in place if these are based on daily bars or that all studies are based on daily bars and so that in the morning when you get up you have already the previous session finished and closed and you have all the information to place the orders.
Orders that should be placed with touch stop-loss, eventually also take profit, so that you put everything on the server or the broker or directly on the market if possible, and you forget about it.
You close your platform, shut off everything end you go to work or wherever you want to go to.
Obviously, these kinds of strategies face drawdown periods, as every kind of strategy, of course, being strategies that would not trade very often most probably, you must consider that you might encounter long or prolonged drawdown periods.
These prolonged drawdown periods might heavily affect you psychologically, so it’s fine to do so, but you must be aware of this you don’t have to expect something that produces money every single week of your life, and you must have an idea of how long the drawdown can be before starting and how to react and always put in place some number where you decide to stop your trading activity.
It might be the level of drawdown, it might be the number of losses whatever! That depends on you because it depends a lot on your psychology but there must be a barrier beyond which you don’t want to go and you want to stop your trading in that specific strategy. These strategies, to have a chance of surviving and to be so that we can really read the performance of the strategy must be pretty much simple things.
If you build a very complicated strategy with hundreds of parameters and constraints that you will have some beautiful thing that worked perfectly in the past and most probably as soon as you put it live you lose your money, just because of the overfitting you went through.
While if you have simple strategies… What are simple strategies? Strategies when you take a trending market and you buy the breakout of the high or you sell the breakout of a low of last daily bar, simple!!!
And then you can put on top of it some filters to limit the activity but simple filters again.
You might be willing to enter only if you come after low volatility period you can code it, or for example, after congestion or again some slow activity you can measure it with (I mentioned it in one of the previous videos) an ADX. You just say “I enter only if the ADX oscillator is below 40!” for example.
Very well, then you have not a high acceleration in prices and you expect that the move that takes place will be a good one once you enter. Always place a stop loss obviously together with the initial order.
So these are simple strategies.
Simple strategies face a bad period!
It’s normal because more basic your code is the more robust it might be because it follows concepts that have been working for years, but obviously they’ve been working for years intended as years of positive result overall, but not for every single week or month as I said, so you have to be aware that you will have losing periods and being aware of this you might be ready to face this and to do what you think to do.
So part-time trading is fine, it can be done, but you have to treat it the right way considering that it might be heavy psychologically.
Obviously, always trade what you can afford to lose don’t try to become the next Rockefeller with a small account and risk too much.
Always try to put your trading account funded with the money that you can afford to lose because trading is dangerous, is dangerous!
That said I don’t recommend to trade full-time.
I don’t say that full-time trading is less challenging from a psychological point of view. It is challenging as well maybe you face it with a different attitude, maybe your expectations for full-time trading are different than from part-time trading.
So I am just mentioning that part-time trading is fine, but it might be challenging because you might have the results that you did not expect.
Negative of course in this case, so that you get disappointed and you lose confidence in it.
So you have to be prepared, to build a plan and to stick to the plan as disciplined as possible.
Full-time trading is also very challenging and it might be even more if you do it in desperate conditions, for example, you try to invent a full-time trader job because you lost your job, this is the worst thing you can do.
I mentioned that in another video and you are really to be aware of this and consider trading is a dangerous and difficult job to learn and you cannot learn it into online lessons that you find in some internet website in a couple of minutes.
It takes time, it requires commitment and discipline and a real professional attitude.
That’s it guys I hope it helped I hope it was useful, we stay in touch!
Ciao from Andrea Unger