Note: Everything you ever needed to know about trading is available for free on the Internet. There is nothing new. Trading has gone on for centuries. Basic principals have remained the same. So yeah.. I might be rehashing well know observations here but adding my own use of them. You might see a few things that should work but don’t. Trading should be fun and reasonable simple. The important thing is preserving capital while making a profit. Like any business. If you treat it like a mini-business and enjoy it, it will be worth it.
Should I Trade After Retirement?
That depends on a lot of things. Mostly financial. Do you have some capital you can afford to lose if the worst should happen? Do you have the skills needed? Would you be able to trade using proven strategies and leave the emotions out? Trading can be very profitable. A reasonable good trader can easily return 20+% on his capital annually. And by compounding, it can grow faster.
Also you need to determine your reasons for wanting to trade. Is it because it is exciting thing to do and a challenge? To earn income from your capital, or maybe just to grow your nest egg. Those are the things you need to consider.
How Much Can I Make Trading in Retirement?
This is a complicated question but here are some thoughts: It depends on a couple of things:
- Your available capital
- The margins you get from your broker
- Your knowledge of the market and trading strategies
- Your discipline to treat trading as a business
Given a reasonable positive answer to those questions – there is no reason one cannot return 5-8% of capital a month. Trading is a very fluid animal. And yes, of course it is risky. A good trader will try to reduce risk as much as possible. And increase the probability of a trade as much as possible with the information available.
It also depends on your needs. If you need to take profits out of the trades – that is ok of course but then you cannot expect to increase your capital. If you trade to increase capital – then you will enjoy the exponential growth because the higher the capital the more you can put in per trade.