All That Glisters

Lambretta has a post today, extolling, I think, the virtues of trading for a living. Included in the post over at Thoughts of a football trader are these lines:

What many, me included, try and do is make the same amounts they hear others are making or what they see in videos.

That may be true of some people, but it doesn't include me, and I would hope most people are smart enough to understand that we are all coming to this activity from different places. Some are students with plenty of time, but little money, while others may be in retirement, with relatively large sums of money to play with, and the rest are somewhere in between, and also we have different levels of experience with gambling and investing. If I hear that others are making (decent) money, and the tales actually ring true (the nature of gambling means that there are a lot of false prophets to be wary of) then it is good to know that profits can be made, but it is nonsense to suggest that anyone seriously tries to match the returns of a stranger with whom they share very little in common. Lambretta continues:

Yes, it is possible to make more than you did/do in your 9 - 5, but the real benefits lie in your quality of life - Being your own boss, working your own hours, spending time with significant other and/or kids, having the ability to do what you want, when you want. Ask yourself this, if you were paid as much as you earn/earned in your 9-5 but with all the benefits listed above, would you do it? Of course you would.

Would we? I think again that this decision all depends on what we consider our future prospects to hold. Salaries go up each year. Benefits increase each year. Vacation time, sick time - all these factors need to be considered. Try getting a loan for a house with no documented income. You're unlikely to get the best interest rate, a hidden cost that will add up over the years. You might be making £25,000 a year now, but after a few years this number will often be much higher. The betting industry is constantly changing, and edges don't last for ever - if you have found one, then what's to stop someone else from finding it - so future earnings from betting are uncertain. There is also the possibility of regulatory changes being introduced, the possibility of a ban on in-play trading for example, not to mention the dislike in the industry for consistent winners. Bookies will ban you, making Betfair's decision to tax you at up to 60% seem almost generous. Which it is if your only viable option is that exchange, but it highlights the risk of thinking that these golden days will last for ever. I now have just £4,590 to go before hitting the current barrier, but there is no reason to suppose that this barrier will not be lowered in the future, especially if they see customers continue with them. Not that it ever seriously crossed my mind, but had I decided to quit a secure job to go full-time, that would be a decision I would be regretting. Lambretta adds:

So, don't push or force yourself to earn what you think you should be earning through trading, strive to make what you do already. Once you've achieved that and have all the benefits that come with it, then you can allocate time to improving your income.

Striving to make what you do already, again makes no sense. Opportunities to make money are often out of your control. Value may just not be there all the time. It's the old canard about targets and limits. They are destructive. You strive to make as much as you can - you don't stop because you have reached some arbitrary amount, or because it's 5pm. Some days may see umpteen opportunities, other days none.

My advice is to bet and trade as a (hopefully lucrative) hobby, and to focus on a lasting career during the day. Trading is fun, when it's a hobby, but I suspect not quite so much fun when it's your only source of income. Your quality of life is much higher with a career, and a profitable hobby, than it is from just a full-time hobby. And six weeks of paid holiday time is always nice too!