Trading should only be done with the money you can afford to lose. For example, if you have a retirement sum and no future income apart from that money. In that case, think carefully about how much you can afford to lose in the learning process and the general fluctuations of the market. You should not trade all of your retirement money if that’s your situation. Since I’ve always been a trader, I traded all of my retirement money when I retired and had no job, so I’m in that boat. I’ve been trading for 20 years, and I have already gotten comfortable with how it all works.

If you’re starting to be a trader, I’d suggest you spend the time on investment learning, understand how to trade with the system, backtest it, and understand how the drawdown will work. After that, if you have a drawdown in your account, you can take an amount of your capital since it won’t hurt you or stress you out and trade with that amount of capital. Then, you can leave the rest in whatever other investments you’ve got. You should only trade with pure risk capital that wouldn’t matter if you lose it until you find your feet, become consistently profitable, and have proven that you can grow it. Then, you can make your own decision about how much of your capital you trade.

If you want to be a trader, you need to be cautious and not aggressive. You also need to have ultra-defensive trading, small positions, and small exposure. However, don’t take leverage and learn carefully with a small account. But, if you decided that, you don’t want to take the risk and just want to invest your money in real estate or an annuity stream, or whatever fits your profile and objectives, it would be great. But if you want to build that wealth and grow it in the stock market, then learn to trade in a way that still fits your objectives and your drawdown tolerance. Don’t give up on the idea, but certainly trade carefully and investigate yourself first.

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