Growth Trading vs Income Trading

Alright, so let’s talk about trading for growth vs trading for income. For anyone that’s just starting out (or even if you’ve been trading for a while) you need to understand what you’re trading for.

What does trading for income mean?

So what does it mean when you are trading for income?

When you’re trading for income, it means that your account is pretty big. And let’s say, for example, it’s $500,000.

So it is already a larger account and all trading profits are taken out of the account to generate income. Hence the name trading for income.

Let me give you an example.

Let’s say that on the $500,000 account, you would trade the Wheel. One of the trading strategies that I like to trade on larger accounts here.

And the idea here with the Wheel is that you are generating approximately, let’s say, 30% per year. So this would be $150,000.

So here, for the sake of our discussion and to use rounded numbers, this would be approximately $12,000 per month.

I know it’s a little bit more. If you divide $150,000 by 12 months, it would be more than $12,000, but for simple math, you get the idea.

So at the end of the month or quarter, doesn’t really matter depending on how you want to do this, you transfer any amount that is larger than $500,000 into your checking account as your income.