O.k., I will turn pro in January 2020: TradeInvesting for a living!
After 26 Years of a career in IT-Management with 70hour weeks and a > 730% (alltogether, not ann. :-)) Performance Track Record since 2011 with P123 Modells, a PHD with 33 Years (on the software based trading subject) I give this a shot!
Capital: about 1.3 Million (450k in Real Estate, rest in the portfolio), that I scatched together in an epic grind (and a lot of explanations
to my family (2 Sons!) to spend only half of our monthly money).
Tax Issues are resolved with a good tax layer, so I think this risk is been dealt with. All taxes are paid, I start 100% with a clean
sheet.
A got a psychologist as a trading coach, we went to monster sessions (with meditation and big hypnoses) and he will coach
the process.
My wife is thrilled (no irony here), she has my back 100% and is telling me since years to do this!
Best of luck in your new venture! I’m confident you’ll be successful since you already did the one most important thing possible and that is receiving the support of your family!
Andreas - I think you will do just fine with your new endeavor. The only thing to watch out for is the change in lifestyle. Going from a very busy career with people around you all the time, to a quieter life isn’t easy for most people. But I am sure you will manage just fine.
Andreas - Good luck with this venture, but bad timing, I think. The probability of a recession in 2020 is fairly high - watch the BCI and other indicators.
Good choice - there is after all very little downside → if it does not work to your satisfaction after x years, you can go back to your former career considering the pedigree you already have (PhD, work experience etc).
As a side matter you mention German taxes. I might soon move to Germany from the UK. Do you know if there an investment wrapper that lets you trade within it w/o paying capital gains tax? Or -at least- pay them when you close the vehicle and take your money out.
In the UK, there is for example a Self Invested Pension Plan (SIPP), you have assurance-vie in France, 401k or similar in the US, etc…
Good Luck! I have enjoyed your post. You have given me some good ideas on ranking rules that I have incorporated into my sell rules. When you doubt your trades, turn off the media, take a walk and think things through.
Congrats and good luck Andreas. Make sure to keep in touch with friends. As someone who has semi-retired and moved I realize I didn’t fully appreciate the social aspects of my work.
freue mich für Dich, dass der Traum sich jetzt verwirklicht. Glückwunsch !!
Wenn du Lust auf “fachsimpeln” für dieses (und andere, vielleicht sogar wichtigere) Themen und ein Treffen hast, gerne wieder!
That’s one of my dreams. You are very brave to follow your dreams. From one IT manager to another I think the one thing you have done by getting a phycology coach will help you. I always think I can control my emotions but I can’t. Since 2009 my business outcome hypothesis is the US is built on Technology and therefore the Nasdaq is the best place to invest. I have always been invested in the Nasdaq but everytime there is correction I pull out don’t follow the model. Even though my hypothesis has been validated many times I still don’t trust my design. I think the phycology coach would kick my but and stop me. Maybe I can borrow your coach
Mental and social sides will by far be the hardest. Harder to do full time than part time by a lot. Have to have healthy distractions.
Rent an office if possible. Maintain work life separation in terms of physical space. I know many people doing this, and did it for six years myself.
Biggest mistake was not renting outside office earlier. Out in systems to help manage stress - I.e can’t access trading or work outside of your office or out of hours. These behavioral control systems will save you. Commit to exercising and regular work hours.
Know when your models don’t work In Advance. Know your stop losses for model, strategy type, market regime, etc.
Create a network of other traders and maybe share top ideas and social support, maybe even coinvest.
Also have network of non investors. There will simply be cycles where what you do doesn’t work. This happens for every trading style and type. Have a plan In Advance for what to do then.
Mental and social sides will by far be the hardest. Harder to do full time than part time by a lot. Have to have healthy distractions.
Rent an office if possible. Maintain work life separation in terms of physical space. I know many people doing this, and did it for six years myself.
Biggest mistake was not renting outside office earlier. Out in systems to help manage stress - I.e can’t access trading or work outside of your office or out of hours. These behavioral control systems will save you. Commit to exercising and regular work hours.
Know when your models don’t work In Advance. Know your stop losses for model, strategy type, market regime, etc.
Create a network of other traders and maybe share top ideas and social support, maybe even coinvest.
Also have network of non investors. There will simply be cycles where what you do doesn’t work. This happens for every trading style and type. Have a plan In Advance for what to do then.
I found it very lonely, and have gone back into startup world. There are also many, many factors u can’t control. Good luck.
I would consider consulting part time or something that is a healthy distraction. I found my decision quality was better that way.
good advice!
Especially the “social impact” is crucial: Meeting people totally isolated from the stock market and trading, exercise regularly, pay attention to good nutrition (no meals in front of the screens), no junk food and pay attention to family life. Play with the children, take time with them.
It is easy to get totally lost in trading, models, optimization and stocks, it can become an addiction.
Are you going to manage other’s money? Also, what makes you make this decision? Because a lot of things you can do experiment on and don’t have to time to try?
Thank you!