Perhaps I did not explain my point 2 correctly. Let me try to explain it again.
An investor can always earn passive income from portfolio. i.e. an investor can always buy a mutual fund or a PMS and outsource the investing task while continuing to focus on the non-investing job. With a MF or PMS, investor needs little efforts to earn the passive income and will pay the expense ratio or the PMS fees to earn this passive income. I am assuming most of us can earn about 15% rate of return this way with little efforts. i.e. buying a MF or PMS. This way an investor can earn job income AND passive income from portfolio.
Again, my assumption is an investor needs both job income and portfolio income to support current level of expenses or is trying to maximize his/her income.
Let me try to explain with an example.
Let's assume an investor has a portfolio of 1 cr so this investor can earn 15% or 15 lakhs as passive income by investing this portfolio in a MF or PMS.
If investor expects to earn same 15% by being a full time investor, there is no additional gain in this arrangement but he will lose the job income in the process. So investor's gross income from all sources goes down.
On the other hand if investors expects to beat a MF or PMS by being a full time investor and expects to earn 20% (or 20 lakhs on a portfolio of 1 cr) his/her additional gain is 5% (or 5 Lakhs on a portfolio of 1 cr). I consider this 5% or 5 Lakhs as the active portfolio income. If the active portfolio income is higher than job income, it makes financial sense to switch to a full time investor.
However, one must adjust the active portfolio income for volatility. Active portfolio is likely to be highly volatile as stock markets are volatile and investor's ability to beat the market will also be volatile. There will be periods when an investor will not be able to beat the markets or MF and active portfolio income will be negative. It will need a good outperformance just to cover up the lost ground. My thumb rule is your expected average active portfolio income over a market cycle has to be twice the job income (as job income will be steady - again this is an assumption) to be considered equivalent.
So if you expect to beat MFs or PMS returns by 5% each year, your portfolio needs to be 40 times your annual income (1 / (5% / 2)) for you to be a net gainer as a full time equity investor.
Similarly, if you expect to beat MFs or PMS by 10% each year on average, your portfolio needs to be 20 times your annual income (post tax).
Again, my assumption is you want to maximize your income from all sources using all your assets including whatever you do to earn your current job income. If you hate your job, then that's a different question and it has nothing to do with investing as full time (and I think one should not be a full time investor just because he/she hates current job). Also, if your investment income covers your current expenses and all future financial goals and liabilities then you shouldn't be working in first place. the fact that a person has a job means the job income is needed in addition to the investment income.