<![CDATA[Money is a taboo subject socially. Most people avoid the topic like its the plague. Many believe money is inherently evil. But in the trading world, your success is defined completely by whether you can make money or not. You cannot talk about success in trading without talking about money. Time and money have a very important relationship. In order to find the ultimate freedom and success in trading and in life, you have to understand the relationship between the two.Today what we are going to focus on how to master the relationship between time and money. It is an essential thing to understand to find success in trading, and also to find happiness and fulfillment in your life.
Rich in Money, Poor in Time
I once knew a wealthy girl who had a father who was a lawyer who specialized in merger and acquisitions. He made 7 figures a year, drove a Bentley, had a $5 million home, a beautiful wife, and had 3 healthy children.But he worked 12 hours a day, every single day, and often on weekends. Every day he would get up a 6:30 am before everyone to commute to work and would get home at 8 PM and miss dinner with his family almost every night. He would be so tired when he finished working he would have to most of his free time recovering from his long work days.What’s the point of making all that money if you don’t have any time to enjoy your life? True success, in my opinion, is having a profession that gives you the freedom to do what you want, while still generating the income you need for your ideal lifestyle. I would take making 4 grand a month working 2-3 hours a day on my terms than that man’s lifestyle any day of the week. Getting rich is an aspiration I am sure many of you reading this have aspirations for. But it is not the cars, houses, and money you should strive for. It’s time. Money and material possessions come and go, but time can never be replaced. That last moment is gone forever.
Trading Time For Money
Money’s value is also determined by time. There probably isn’t a single person reading this who would decline $100,000 for an hour of their time. But getting $100,000 over 10 years has significantly less value, especially if they have to work 40 hours a week. Most labor systems in the world are based upon a time-for-money trade. Hourly wages, weekly/monthly salaries are most common. It is the most common form of exchange for money. In the trading world, this all changes. There are no guaranteed salaries or hourly wages. You get to chose your hourly wage based on how much you risk per trade. You can actually trade for 40 hours a week and LOSE money. There is a never guarantee you will make money just because you show up to trade. NOTHING is guaranteed in trading. The flip side of the coin is that you can create an amazing time trade for money with trading once you master the skillset.Many successful traders make thousands in a few minutes of their time. No boss or anyone who can tell you what to do, and all you need is wifi and a computer to make your living. It is by no means easy to get to this point. But even once you become a consistently profitable trader, there is no other profession that can compare.
Breaking Free of the Time For Money Trade
In order to live the life of true freedom, you need to find a way to break away from systems where you have to trade significant amounts your time for money. There are a lot of ways to do this. Day trading and swing trading stocks is one of the best ways due to its scalability. I am not saying that you won’t have to put in long hours make trading work. Or any business venture for that matter. Nothing worthwhile comes easy. But if you’re going to suffer, why not do it for something that offers you freedom and scalability instead of just getting by? Once you do find consistency, you are able to scale your income over time, improving the time for money trade you make while you’re trading. Scaling up your position sizes, when done correctly, can increase your income without you having to give up more of your time.
No Linear Relationship Between Money and Time In Trading
Many traders make the mistake of measuring the hourly wage based off one or a few trading days. You see traders on social media with posts like “How I Made $1000 in 15 Minutes Day Trading”. This gives the impression that for every 15 minutes the trader trades, he or she makes $1000. That trader would likely not make another $3000 if he decided to trade for another 15 minutes. For all we know, that trader could’ve lost $2000 yesterday in 5 minutes. So really he or she might have lost $1000 in 20 minutes over the two days. You don’t want to measure trading results on short term time frames. You want to focus on the bigger picture trend of your PNL over weeks and months. What do you average per week over the span of months is more important than what you average per day, or per hour.
Trading is one of the best ways to get out of the time-for-money trade which binds most of society. But it is not an overnight process, and it is by no means easy. But the return on the time and money you put into learning the skill cannot be found in any other profession. The sacrifices you make to develop the requisite skillset are worth it. Trading gives you the ultimate freedom in life and cannot be found in any other profession. Trading time for money is a relationship that must be balanced correctly. Before taking on any new venture, always consider what the time-for-money trade will be. Always be stingy with your time and what you do with it.