Hi guys, hi from Andrea Unger. Today, I’ll try to answer a question people often ask me, which is “Can I get a steady monthly income with trading?”
I’d like to clarify a concept, as many asked me about it: I believe one can absolutely live and make money as a trader, but it will never be a 9-to-5 job. I wanted to dispel a myth that is too often propaganda and creates false illusions. Trading as a living is possible, but it does not mean, however, to bring home the salary each month, as there may always be losing months.
It often happens that people look at trading in search for a monthly income, which can be either an addition to their current salary or a substitute for it.
Honestly, I think this isn’t very likely. I know that you’ll get disappointed reading this, but just think a little bit about it.
Trading Can’t Produce a Regular Monthly Income
In trading you can gain “one” for three consecutive months, and then lose “three”, which means you will go back to zero. Actually, you probably also have expenses, because if you live on trading, you obviously need that money. So, in the end, you risk being below zero.
The point is that it’s quite difficult to get a linear equity income. This is partly due to the difficulty in setting up the necessary tools to do so.
There are strategies that produce linear equities for many months. Some of them can be also found on the internet, where there are people selling their methods and systems.
However, what they don’t tell you is that that linear trend can stop anytime. If you are lucky, you don’t lose too much, but an adverse event can always occur, because the more this linear scenario is there, the higher the risk when things go wrong.
Let’s see what normally happens. If you are a profitable trader, you gain money and can live on it. You can use your income to pay for your children’s school, for the food for your family, and so on and so forth.
However, there can always be moments or periods when you lose money, even though, on the long term, you are still making profits. In those moments, you can’t rely on that income anymore, so how would you feel? This is something you must be aware of.
Always Be Ready to Face Bad Moments
You can perfectly live on trading, but you must be aware of possible falls, because equity lines are not always linear. This is something that simply doesn’t exist. It’s a pity, I know it, and I, too, would like to be able to rely on constant linear equities.
Please, notice that I’m not saying they don’t exist because I have not found them. I can tell you they don’t exist because I’ve seen that the linearity of equities doesn’t last forever.
There are hedge funds that show linear equities, this is no secret. So, you can find them. They were able to do that, but then, all of a sudden, that linearity can stop.
Any method or technique that allows you to get a linear equity entails the risk that that linearity stops. And, unfortunately, you won’t be on holiday, when that will be happening. You will be there, trading.
So you must be aware of the fact that there are no techniques, methods or systems that guarantee a linear income month after month.
Trading is a passion. It can be a hobby. It can be a job, even a full-time job, and you can trade for a living. However, you will never get a linear income month after month.
You won’t get a constant salary, so you must always be ready to face bad months.
Trading Is Not a 9-to-5 Job
Trading is fine and beautiful, but incomes are not regular. If you want a steady income, you need to apply for a 9-to-5 job, hoping that you can find it. That is what guarantees a well-deserved salary at the end of each month.
Trading, instead, isn’t linear. You can earn on the long term, but some falls can always occur along the way.
I know this isn’t what you wanted to read. I know you might now think that I’m an idiot. Some traders will laugh at me, but I’ve seen this with my very eyes.
I know this is what happens out there. I’ve never seen a constantly linear equity, and I don’t think it can actually exist. Sorry about that.
Stay tuned for more stuff to come!
Ciao from Andrea Unger.