This topic always reminds me of a trip I took to a prop firm in London. It was my first time meeting their CEO - we had a quick chat then off for lunch. As we got to the lift there was a shout of “hold the lift” and two young traders walked in. One of them said “Are you Peter Davies?” and my answer (obviously) was “Why?”. It turns out that the two traders had gotten their start in Order Flow trading from the lessons at Jigsaw and they ended up trading similar techniques for the firm. This isn’t the norm but just one of many ways people end up becoming a full time day trader.

So there’s a few ways people become a full time day trader.

Bricks & Mortar Professional Trading

On the professional “bricks and mortar” side of the industry, firms typically look to recruit out of universities. There’s a few reasons for this:

• Prop firms do give an initial low salary but that tapers off - you earn from your profits. So that could leave you 6-12 months with very little income. That’s ideal for someone young.
• People that have the attributes for trading but that didn’t trade yet don’t have any bad habits to lose. By bad habits, I mean “crazy stuff they learnt off the internet”.
• The younger they are, the easier they are to mould.

There is a preference for those with a competitive background - be it a sport or chess - anything that involved learning a skill and getting very good at it - which is what trading is.

Now - don’t despair - I have seen home traders approach and get funded at regular prop firms. Frequently, this is initially done by reaching out with a REALLY GOOD LETTER. I would avoid the emails because it’s just spam. A nice letter, with a nice envelope and a nicely hand-written address on the front. That’ll stand out. And email the CEO, not HR or the guy that keeps the toilets shiny.

You need to differentiate when you approach a prop firm. The mistake most people make is saying stuff like “I am a really hard worker” or “my dream is to be a trader”. What you need to do is start off by telling the firm what you can do for them - and explain why you have the skills to become a great trader in their environment. Research a little about them and weave what you know into the email, to show you are willing to do research.  

Tell them about your trading, your progress. On their side, it’s a bonus if they think you represent less risk (aka a higher chance of success) over someone with zero trading knowledge. Or if you have some of the skills they require and need less training.

Everybody wants to be a trader, every letter says “I’m really hard working” - but very few say “Here’s how I present an opportunity to your firm”.

You should present as a well-rounded trader that is aware of financial events/news and general current affairs as well as any “technical” skills you have. Prop firms know that the world moves the markets and if you come across as a technical trading geek that shies away from news, it’ll be a red flag.

Even if you have zero experience as a trader, you can write to a prop firm - but do your research on them to ensure you hit the right points for that firm. Recruiting traders is tough, someone that shows the initiative to write a great letter will get credit. You might be surprised AND disappointed if they (for example) offer you an unpaid internship. 

So - show them some progress, convince them it’s a mutually beneficial relationship and show them some progress (or even better - profits) and it’ll be easier for them to take you on.

Retail “Home” Trading

The success rate for home traders is well below those on the professional side. After all my years in the industry, I think the biggest difference between home and professional environments is that on the professional side you will have a boss who wants you to do certain things, keep within certain limits and show discipline. At home - there’s no boss and nobody to fire you if you misbehave.

For those with a day job (or night job) - you need to carve out a time to trade. This should be time you are available and when there’s decent volatility. For those working USA day jobs - look to Japan OR stick to US evenings and be prepared for “no trade”. In the overnight session the US Index futures can put in some good moves - but it’s a VERY long session and those moves could start any time in a 12 hour period.

Some people try to replay the day-session when they get home but there’s no path from there to going live for them as they are working that time. No matter how good you get on replay - going from replay to live AND giving up your job at the same time is a recipe for disaster. This is not how to become a day trader.

So you pick the times you can trade, do 15 mins prep before the market opens to see what news is driving the markets, look to see if the activity level is sufficient and repeat every day at the same time. Have yourself some slower market (range scalps), more active market (momentum/pullback trades) and crazy market (scaling in to a reactive big news move) and perfect them.

Now - most people will look at this and think “that’s it?” - because most people spend their time looking for more and more “techniques” - whereas trading is really all about taking a rough technique and refining it with repetition. Your edge in becoming a full time day trader is ignoring all the noise about the latest “Magic indicator” that will make decisions for you. Take a look at Marcos story (https://blog.jigsawtrading.com/keep-your-trading-simple) - his trade plan was 52 pages and he was totally lost. We took that down to 2 pages - and then the consistency came.

Goals

On the professional side, the firm will define goals for you. These will change as you progress. Initially you’ll be on SIM, trying to ‘earn’ your live account.

It’ll be different depending on style (e.g. outright or spread trading) but a typical set of goals would be of the order of making $2-300 a day without losing more than $1000 a day. They do not expect you to hit the $2-300 a day because it won’t always be there - and they expect you to figure that out on a day before you hit the $1000 loss.

On your side - you should do the same thing. Set goals, set a length of time you need to achieve those goals consistently - and have that as your “go live” criteria. You should expect some drop in performance when you go live - that’s normal. 

The goal for any “working trader” is to reach a profit. There won’t be a fixed profit each day because the markets bring a different amount of opportunity each day and some days there is no opportunity. You cannot make $1000 a day but you can average that. But this sort of target should be put to one side for now. For now, just stick with getting to profit and don’t worry whether the numbers aren’t enough to live on right now. 

It’s a milestone - having profits coming in with no real expectations other than consistently profiting. Forget the amount you need to retire on at this point. You’ll end up a much wiser trader this way - you’ll also get to your larger goals much faster if you focus on one milestone at a time. Getting to profit consistently with “pocket money” is going to give you the skills to then scale up, add more setups or more markets.

At this point, you’ll be able to make some smart decisions about whether to approach a firm with your track record, so that they can take on the risk of larger size trading. You might find a trading “sugar-daddy” to work with. Or you might go solo, slowly increase your size, take the trades across more markets - squeeze the most from the opportunity. Just like they do on the professional side.

But the choice doesn’t have to be made right now. Getting profitable on a small scale with a narrow range of techniques will open doors for - which one’s you decide to push - well that’s your choice. Hopefully, this gave you some food for though on how to become a trader.