Best Reading Materials to Start Trading for a Living

Trading for a living is not as simple as it sounds. If you want to become a full-time trader, it's important to gain more insights about trading.

The idea of becoming rich simply by opening and closing positions seems like a life goal for most traders. If you enjoy analyzing and studying the financial market, gaining consistent profits from trading must be a dream comes true. It's no surprise why many people want to trade for a living. But in order to earn enough to live off from profits, you should understand trading as a profession. That means paying more attention to trading strategies and beyond. Unfortunately, that is not a quality all traders possessed.

Do You Have What It Takes?

Admittedly, trading is not easy. So it's important that you understand the challenge before deciding to leave your day job to pursue trading for a living. A lot of beginners romanticize trading for a living but forget to check whether they actually have what it takes:

1. Are You a Risk-Taker?

Before actually making trading a full-time job, you should know whether you are ready to take risks or not. For example, trading for a living is a very risky choice as a source of income. You need to understand that there might be drawdowns and not generating income for weeks. Those two are the most common problems even for professional traders with plenty of experience in the market. Trading is not the same as other businesses, where the next month's sales pitch can be predicted and how much money can be produced in a month. It is full of uncertainty to a lot of factors.

2. How Big is Your Trading Account?

Another thing to consider is making sure that your trading account is big enough to make the transition to full-time trading. Aside from that, don't forget to check your historical performance. Find out how much did you generate over the years. Trading means you are dealing with the unknown, so make sure you also have plans for rainy days.

3. How Long Have You Been Trading?

If you barely start trading, it's best if you focus on learning first. Don't get too hasty to make it your source of income. The amount of your experience in the market plays a bigger role than what you think. In fact, financial markets move in cycles and most new traders never experience a full market cycle. For example, you have only been exposed to bullish market periods, so when the market moves to a bearish season, it might ruin your strategies.

4. Understand Your Motivations

Lastly, make sure to understand your goals. Consider why you think trading is a good source of income, or why you think it's an easier way to generate a six-figure income. Unfortunately, research found that people who are just in it for the money are more likely to lose more. Don't let yourself fall into this, be clear about what you expect from trading for a living. You also need to understand that trading might take a lot of your time. The average professional trader might spend 12 hours workdays and work on a weekend. If you are a social person, you might want to consider this.

Read These Books First

If after reading all the factors above you still want to be a full-time trader, then it's better to prepare yourself for it. There are plenty of methods where you can gain more knowledge and experience about trading. You can learn from brokers' educational programs or try various strategies using demo accounts. Another way you can do it is by reading books on trading for a living.

1. The New Trading for a Living

At this point, you must be familiar with Trading For A Living, a modern classic beloved by worldwide traders. Well, The New Trading For A Living by Dr. Alexander Elder is an updated version of that book. This revised version brings time-tested concepts with today's fast-moving markets. Aside from that, this book explores more new studies and techniques for modern traders. It teaches you a calm and disciplined approach to the markets and emphasizes risk management along with self-management. All charts in this book are new and full colors, with added comments on rules to help you understand them better.

2. High Probability Trading

High Probability Trading by Marcel Link is another book you can read to start trading for a living. A lot of traders tend to lose all of their money within six months of trading. This book aims to cover everything you need to know to prevent that loss. Marcel Link wrote this book with detailed comprehensive programs to guide you through the first months of becoming a trader and help you find a way to generate profit. This book takes a unique way to look at the reality of trading, filled with real-life examples to help you explore each aspect of successful trading.

3. Thinking, Fast and Slow

This book is written by Daniel Kahneman and has won several prestigious awards such as New York Times Bestseller and many more. Thinking, Fast and Slow takes you on a groundbreaking tour of the mind and explains the two systems that drive the way traders think. The first one is fast, intuitive, and emotional, while the latter is slower, more deliberate, and more logical. Kahneman has such a way of writing this book that keeps you engaged and learn more about where you can or cannot trust your intuition. He also offers practical and enlightening insights to understand how choices are made in business and personal lives. To conclude, this is a wonderful work to train your trading psychology.

4. Technical Analysis of Price Charts Bar by Bar for the Serious Trader

Learning about price charts and candlesticks is very important if you want to become a serious trader. Al Brooks created this book specifically to help you understand how to apply price action analysis to chart patterns. The main idea is to help you enhance returns and minimize downside risk. In this book, you can also find some of the most useful tools for deciphering price action. These include trendlines and trend channel lines, prior highs and lows, breakouts, bodies and tails on candles, and much more. By understanding price charts, you can get a lot of useful information to help you succeed.

5. Technical Analysis of the Financial Markets

Another interesting book to get you start trading for a living is written by John J. Murphy. For those who don't know, he is the writer of the bestselling book Technical Analysis of the Futures Markets. His new book covers the latest developments in computer technology, technical tools, and indicators. This book also includes important knowledge you must possess such as how to read charts, understand indicators, and many more.

6. Trading in The Zone

Trading in The Zone by Mark Douglas is another great book for aspiring full-time traders. For starters, this book uncovers underlying reasons for lack of consistency and helps you overcome the ingrained mental habits that cost money. Douglas also talks about market myths and exposes them one by one. You can learn the true realities of risk and be comfortable with the probabilities of market movements.

While trading can be a great secondary income stream, turning it into your main source can be challenging. Ironically, a lot of new traders feel very confident that they can generate consistent profit without considering the risk. That being said, in theory, trading for a living is possible should you have what it takes. That includes enough experience in the market and a good understanding of how the market works. If you don't have enough experience, you can focus on learning first. Reading books about trading for a living can be a great method to gain more insights to prepare yourself. If you continue to improve yourself, it's possible to make trading your main source of income.

Trading books can cover a lot of topics and it's a great way to expand your knowledge about trading. If you aspire to be a short-time trader, taking notes from books about forex scalping can be a great idea.