Can we quit job and invest in stocks full time?

[Julia]

Isn't it good that a self managed super fund is considered a business Julia? I thought there were some tax advantages to it. Curious as I'm thinking about setting one up.

Yes, certainly the main advantage of super is the tax advantage. I guess I was just a bit peeved to be unable to access that term deposit rate.
However, a very minor disadvantage in the overall great benefit of a SMSF.

Julia

 

[stink]

For my mind there are two ways of looking at it.

1. Sure if you have the balls and practice sound money management using tight stops there is 50/50 you could make a consistent profit.

2. The main point which is why point 1 will fail. You are looking for reassurance someone to back you up and say "yeah mate great plan its fullproof". Clearly you are not educated in the markets enough to come to your own conclusion, otherwise you wouldnt be asking.

Do successful traders say on a forum " Hey guys if i do this and that do you reckon i will make money?"

My point is not intended to be offensive, i am just highlighting alot of noob traders are in such a rush to get in the market before they are ready (myself included).

Take a step back mate, the market will be there tomorrow. (thx Nick)

Cheers Stink

 

[porkpie324]

Yes Stink your absolutly correct I learnt my share trading sometimes the hard way (there's nothing like a loosing position it's worth a couple of seminars), but it's good now because I think of a loosing position as a necessary part of trading I've gone beyond having sleepless nights over taking the wrong positions (which I have recently done I closed my long pos in MCR & SMY and went long on KZL), the fact that I'm now in a position to travel and trade full time is a great lifestyle. porkpie

 

[Broadside]

Hi all,

Can you pls tell me if i can quit my job and invest in stock full time?
is it possible?
provided i have 100K cash
pls give me some practical ideas if you think i can do that.
thanks
Tony

The question and topic title suggests to me we are in the last stages of a bull market and a correction is due.

 

[porkpie324]

Yes Broadside thats a Jack Kennedy theory, he sold all his stocks when his shoeshine boy started recomending which stocks to buy just before the great 1929 market crash. porkpie

 

[Laz]

Yes, certainly the main advantage of super is the tax advantage. I guess I was just a bit peeved to be unable to access that term deposit rate.
However, a very minor disadvantage in the overall great benefit of a SMSF.

Julia

I think this is the one you want Julia. 6.35% is not too bad.

http://www.bankwest.com.au/Business/Business_Accounts/Business_TeleNet_Saver/index.aspx

 

[tech/a]

Can we quit job and invest in stocks full time?

If you bought a business what would you pay for one that returned say $70,000 a year.
While I know this varies I would suggest that if you were actively involved in a Business V Being a passive owner drawing a salary,that you'd have to pay around $350-$500,000.

If your going to Trade as a living you would need this sort of capital base in my view to do it comfortably.
Undercapitalisation is a business killer trading as a business is no different.

 

[constable]

Can we quit job and invest in stocks full time?

If you bought a business what would you pay for one that returned say $70,000 a year.
While I know this varies I would suggest that if you were actively involved in a Business V Being a passive owner drawing a salary,that you'd have to pay around $350-$500,000.

If your going to Trade as a living you would need this sort of capital base in my view to do it comfortably.
Undercapitalisation is a business killer trading as a business is no different.

Hi tech, my base needs bumping you got a spare 200k you could spot me!

 

[theasxgorilla]

Hi tech, my base needs bumping you got a spare 200k you could spot me!

Excessive debt can also be business killer

 

[tech/a]

Agree with you both.

I would hope and doubt that anyone looking to buy a business of any size would be financially savvy to the point of understanding cashflow.P/L and of course Balance sheet.

Again trading Business are no different.

Constable.

Send over your P/L & Balance Sheet and I'll consider the investment.
What return are you offering?

 

[questionall_42]

here's a thought ...many here wont like it ...
but a council worker who digs just one post hole a day DOES something for Australia.
Most of us here are just gamblers (fun? pleasure?) who contribute nothing.
Shouldn't confuse work with pleasure imho.

2020 is spot on. I don't understand why Violet would want to be a full-time trader with $100K capital. I am probably in a similar position in life: now have about $130K in assets, doing well(ish) on the stockmarket, but I would never dream of not working again (give me another 35 years or so). Work is great for the self and the world (depending on what you do, of course).

And why haven't any of the full-time traders responded to 2020hindsight?

Good luck trading and/or investing.

 

[markrmau]

2020 is spot on.

I disagree totally. Speculators in the stockmarket also provide a vital service to society. Our input in determining asset values ensures capital is invested in the most efficient manner: in successful businesses which employ workers and provide goods and services.

The most successful countries (with the best health of population, best infrastructure and most easily accessible recreation) are generally those with the 'free est' financial systems.

The council worker may dig a fence post hole, but the financial market tells us if a fence was wanted in the first place.

 

[constable]

I disagree totally. Speculators in the stockmarket also provide a vital service to society. Our input in determining asset values ensures capital is invested in the most efficient manner: in successful businesses which employ workers and provide goods and services.

The most successful countries (with the best health of population, best infrastructure and most easily accessible recreation) are generally those with the 'free est' financial systems.

The council worker may dig a fence post hole, but the financial market tells us if a fence was wanted in the first place.

Great points!
I'd also like to add that its the speculators that hold the shares for the other people who are still making up their minds whether or not to buy them! Then of course we on sell them for a small fee!! (most of the time )

 

[Flathead Flick]

Can we quit job and invest in stocks full time?

If you bought a business what would you pay for one that returned say $70,000 a year.
While I know this varies I would suggest that if you were actively involved in a Business V Being a passive owner drawing a salary,that you'd have to pay around $350-$500,000.

If your going to Trade as a living you would need this sort of capital base in my view to do it comfortably.
Undercapitalisation is a business killer trading as a business is no different.

I'm with you here tech/a. Trading as a living means that it's your business and you need capital and yearly growth for it to make sense to continue in the business over the long term.

What's more, people have to understand is that there is an opportunity cost to trading. Can you make more doing something else full-time (either as an employee or with an alternate business), or working full-time and trading on the side? If you can, then financially you're better off. Of course there are other considerations, such as the flexibility of trading vs a full-time job.

If you do something else and trade on the side, then you're hedging yourself with an alternate career to that of the trader - if things go awry, you get bored or lose your nerve, then you've always got a Plan B.

Remember that the stockmarket doesn't always go up and we've been on a golden run for a few years now. (Of course, different story if you use derivatives or hedge, because you can win (or lose) in any market.)

FF

 

[Halba]

I finished uni last year majoring in finance. I decided to try full time trading/investing. More medium term trades, not too short term.

So far being doing fine especially in my first 7-8 months of trading. Of course plenty to improve! I don't know how many stocks i exited and they've doubled or tripled after my sell.

My access to capital is pretty good through my dad's business.

 

[justasx]

An interesting thread

I am just starting to explore the idea of working full-time as a day trader and so make a living from it. I have several friends who have swapped their corporate slave jobs to working from home by trading shares and are doing very well.

I currently have 16 books on my bookshelf relating to the sharemarket and options trading, and a similar number of books on my online library, all waiting to be read and learned from. So far I have read 4 books and the general conclusion is: YES you can make a living on the stockmarket starting with $100,000 (however it is best to start with no more than $10,000 to $20,000 and put the rest into a more secure interim investment).

The caveats however are many, one of which being, EDUCATE yourself about this area of investment/speculating. It is an apprenticeship and you will surely lose all of your $$ unless you know what you are doing. You can learn by reading many books, doing paper trades and gradually developing a system that will give you a positive cashflow at the end of your trading day/week/month.

It is definitely not a career for the lazy (they will lose all). But if you are willing to commit yourself to learning and then developing your own system (which will limit your loss and maximise your profits), then you will be able to make a living by trading on the sharemarket.

I cannot see it as an easy road to riches, but it can be done with patience, dedication and the use of your brains.

 

[noirua]

If you are very, very patient indeed, then eventually you will be able to leave that day job. Build up your pension fund so you can retire early and, of course, have a good property fully paid for; The ultimate fall back. Always very good to be called on occasionally to do part-time work at a lucrative rate, adds to confidence if they can't fully do without you.

Take care, never borrow, and remain high in cash as markets rise, mature and if you are invested in small stocks or the highly speculative sector. Always remember the Dot-Com crash; the 1987 crash and the 1973-75 crash. Believe you me, it will happen again and catch most, and all of the greedy.

 

[professor_frink]

....Take care, never borrow, and remain high in cash as markets rise, mature and if you are invested in small stocks or the highly speculative sector. Always remember the Dot-Com crash; the 1987 crash and the 1973-75 crash. Believe you me, it will happen again and catch most, and all of the greedy.

Didn't you hear noira-it's different this time!
China?
India?
They need lots of resources.
The old economy is the new "new economy"(or something like that ) Put all of your money into small cap mining shares....you can't lose!
How can the markets ever crash when China is growing so much

 

[Magdoran]

Now I know we’re going to have a correction of some sort! I read some crazy article from Fairfax Tradingroom that 7000 here we come… this just smacks of what you’d expect at the end of a bull run. The expectation the market is going to shoot to the stars.

It’s funny, but I remember the same kinds of comments such as “it’s different this time” and “it’s the new economy” around 1999-2000, and the belief the bull market would last for years. Don’t you know, we’re still in that bull market (except for that little detour – check out a NASDAQ chart for a graphic illustration at the time…).

What is different though is that fundamentally (and I’m no expert) there are some glaring differences… the over extension isn’t as great, so any correction would probably not be as deep or as long (suspect this is a big wave 3 going on currently).

However, if you investigate the whole raft of derivative transactions that may well be going on, there are significant exposures going on. Amaranth is just one example of this, and the rest are hidden. Despite China and India, there is a powder keg of activity tied up in a whole lot of hidden derivative trades right now that aren’t obvious, and are not on the books.

Just watch the financing boom via the Yen carry trade. If this wound out suddenly you could have a Mexican Peso effect (in reverse), but on a much wider scale.

Who knows what kind of damage this kind of thing could do. Just remember Enron and Worldcom, and imagine a widespread meltdown like Amaranth suffered… even a muted version could put a hole in the major indexes.

The point is not that I’m banging the doom and gloom drum, but that we have to be aware that there are very real possible and not that unlikely scenarios of some kind of correction, and even a crash. Most just won’t see it coming, which is more the rule than the exception.

Trader/investor beware!


Regards


Magdoran

P.S. I’m beginning to see some potential for the April 1st scenario over the February 24th one… may see some action mid March in the states too…

 

[Halba]

this is the silliest mkt. i bought stuff expensive and still make money even a 2yr old can make in this