Equity Investing as a full time career?

[nikrod12]

I have a different sort of question for full time investors here. I think it’s most probable that your yearly expenses are/were far lower compared to portfolio. I assume this since anyone leaving salaried job for full time investing will be very cautious and traditional safe withdrawal rates like 4% and 3% apply only for index and mutual funds. Stocks are too volatile and have too much drawdowns to use large withdrawal rates.

Most of us are into full time investing to get much higher returns than index. If we can’t beat index over long timeframe, there would be no point of investing ourselves. So there are many full time folks here who have generated and will generate 18-20-25-30 or even higher CAGR over years.

Just for an example, if one starts with yearly expenses of 12L and Portfolio of 8-10 Cr. After a decade of compounding, if your expenses only keep up with inflation, the expenses vs portfolio difference will be huge.

Now my question for you is have you increased or planned to increase your expenses and lifestyle as your portfolio goes higher? And if not, what’s the point of increasing portfolio value? After a while, it’ll be just a number in demat. And after a certain age, no number will matter if your health is not good. I get that all of us enjoy the journey of investing. But would it harm to enjoy some fruits of our achievements too? Otherwise, there will be only two uses of our wealth. It will pass on to next generation (will anyways happen whether or not we spend) or it should be utilized for charity.

Would like to hear experience and thoughts of full time investors here.

Note - I always had this question in mind all these years. I read in Warren Buffett biography that he always knew he was going to be rich, from the very young age. I am sure most of us who have seen a decade in markets and have generated decent CAGR, know in our heart, that if we continue for few decades, most probably, we are going to end up HNI’s and UHNI’s. The thing I am in process of figuring out is what am I going to do with the money.

[imurlovish]

That’s a deeply reflective and important question, one I’ve also grappled with during my transition into full-time investing. Personally, I believe that before we try to answer what to do with the wealth, we must first arrive at a state of inner contentment - a self-satisfaction that doesn’t depend solely on the next 20-30-50% CAGR or next crore in the demat.

The beauty of full-time investing is the freedom, not just financial freedom, but the freedom to spend time how we like, think deeply, and align our work with our passion. If we truly enjoy the process of analyzing businesses, studying cycles, and watching wealth compound, then we’re already living a meaningful life and the rising portfolio becomes a by-product of that process.

Yes, increasing lifestyle and enjoying fruits of our success should happen but ideally not to fill a void or prove anything to the world. It should happen organically, driven by genuine desire rather than comparison. A better car, a bigger house, or more travel can definitely be enjoyed if it aligns with what brings joy not stress.

At the same time, I agree money just sitting in the demat account shouldn’t become a vanity score. Beyond a point, compounding money without compounding experiences or contribution can feel hollow. That’s where goals like family well-being, health, travel, supporting causes we believe in, or even creating content/mentorship for others can bring tremendous satisfaction.

So for me, it’s not “either/or”, it’s about creating a life where wealth supports the journey, not dominates it. And enjoying the small things now, not waiting for the perfect NAV.

[nikrod12]

You have answered most aspects of my question beautifully. Thank you for these pearls of wisdom.

[Cshar]

I am a passionate traveller, love long drives. In last 8 months, every month I am on a trip. My mom wanted to visit Kumbh, took her to MahaKumbh, Baba Vishwanath, Vindhyachal Devi Mandir by road, stress free, 2000 km by my Honda Elevate. Had Ayodhya road trip in Dec 1900 km, Goa trip in Dec, beas kind Trekking in Sept, Nainital Trip just Completed. Two trips to Hyd for family function at In Laws place. Jaipur , Jodhpur trip. Sorry for writing in details however in last 8 months i have realised what was lost and what i am looking for. Aim to cover all religious places in next 2-3 years, need to take my wife for a long world tour before 55. Have bought one property in Nainital, planning to add one in Goa and I am done.

Long term investing is watching paint dry hence choose 10-12 shades and watch them getting dried, its an interesting process, i follow “investing is looser’s game” hence patience and conviction both are tested especially during market rise ehen stock doesn’t move​:joy:

I don’t know about others however, in my experience Corporate Jobs takes more from 99% of employees than they offer. Crying Babies and Yes Man only survive for long by selling their time to their bosses personal ego. For me productive hours were maximum 3 per day, only my program in APAC region was hitting postive P/L, despite this someone else was promoted​:joy:. No Salary hike for two consecutive years for everyone in Sr. Roles and this poisonous culture is there and will be there for maximum employees until they put papers. There is no need to work for others if u have options and people who choose to work for themselves go a long way, history has proven it. Job is just a way to earn your living for you and your family. Once you understand that your thought process will change. In last 27 years my total post tax earnings are less than my total equity returns in last 8 years. Thats sums up all.

[ChaitanyaC]

Very personal, I would say. Depends on what issues seem important to us. What kind of beliefs we have, what kind of world, society we think we are in, and more importantly, what would be future?

Occasionally we do hear, experience some basic, natural things like water unavailable for some people for a brief period of time. If we look at future from these kind of lenses, our children might experience dystopia in their lifetimes. If we brushoff such things as isolated incidents, and believe that things will be normal quickly, which in most cases do, we are back to our utopia. I am sure, you get the point.

Obviously, most of us, if not all of us, want to give the lion’s share of our fruits for our family. Some, the remaining, as you have rightly mentioned can be utilized for philanthropic purposes. What could be such causes? They could be anywhere between saving whales to donating to an old age home. The more concerned we are, the more funds we have, the more we can do, as we know. If what you say happens, HNI and UHNI, they can easily start a organization of their own.

I am yet to touch, taste any kind of big numbers, yet, but I have already experienced the feeling of time being dissipated quickly. Nothing can replace this feeling. Perhaps, the very reason why even accomplished, corporate ladder climbing people have exited their jobs. Time. Time to spend for themselves, for their loved ones, and do whatever they want to do, even space travel.

So in my opinion, from my perspective, it is not necessarily about the CAGR, which in all probability will at least remain the same, if not go up, with experience, it is the freedom of living life as one feels, that makes full time participation respectful. Run, garden, read, write, teach, the list is endless. Self-actualization.

Even for the high-achieving folk, intelligent minds, financial markets many times provides tough times. So there is no dearth of excitement, no chance of feeling what Caesar felt, as there are many worlds to conquer. Conquered Indian equities, there is US. Defeated humans in cash, there are algorithms in derivatives.

So, who have thought it through, and have taken the decision to go forward, I am guessing, they are finding everything that they had hoped for.

Living below the means, for the time being, if necessary, spending time with family and friends, PF growing, assets increasing, handling regular volatility, if no decimating crisis happens, life is good. Fulfillment in every way.

Some thoughts, which will remain same w.r.t time.

[Dr_Manoj]

Thanks a lot for sharing your daily schedule. It’s really well managed.Can you share the skills you intend to develop (or developed) for trading and investing?

[zaid]

I think it’s not a wise move to quit your job as you have responsibilities and your main source of income is your job. Instead switch to a role where you are working on the financial markets like equity research. This way you are working on gaining knowledge about the markets and the same time have a source of income. Whatever you choose, wish you the best.

[Deven]

Good Discussion.

I’m not a full-time investor yet, as I still spend a few hours managing my business. That said, I’m on the journey toward becoming one. I want to do this because I genuinely enjoy reading about businesses and investments. Even if I realise that I can’t beat the index, I will continue investing in stocks.

Here are a few suggestions from my side for @varunm2112 and others vp friends.

1. Have a productive time slot.
   I’ve identified my most productive time slot — early morning, between 4:00 AM and 6:30 AM. I try to schedule tasks that require focus during this window. Everyone’s productivity window is different, so I encourage others to find what works best for them. To maintain this schedule, I usually go to bed early.

2. Broaden your knowledge.
   Whether you’re already a full-time investor or on your way there, it’s important to broaden your perspective. Don’t limit your focus only to stock tickers or the companies you’ve invested in. Learn from books, autobiographies, business podcasts, and other sources. Expanding your knowledge base will help you think better and invest better.

Just my point of view.

[Prdnt_investor]

@imurlovish

Beyond a point, compounding money without compounding experiences or contribution can feel hollow. That’s where goals like family well-being, health, travel, supporting causes we believe in, or even creating content/mentorship for others can bring tremendous satisfaction.

So beautifully articulated. Thank you!
I would suggest philanthropy can be a great motivator during this phase.

The biggest inspiration comes from the likes of Ashish Dhawan who plunged headlong into creating a true difference in the education space (CSF & Ashoka University) with his philanthropic endeavors

[Midhunjoe]

I am planning / pursuing the following at the moment as far as side projects are concerned

Study technicals : I mainly read books . I am not very good at watching videos and learning.

Pursue CFA : I have started to learn the CFA curriculum. I have not applied yet due to the high fees though. I think CFA curriculum gives a rounded view for analysts.

Learn basics of AI : I am interested to learn the applications of AI in equity research . How it can be a good research assistant .

Substack : I have launched a Substack recently Midhun’s Substack | Midhun James | Substack.
I try and publish on the companies / industries/ topics , I find interesting.

I am also keen on fitness and workout . I spend around 2 hrs on most days for that too.

P.S : Even though all these might sounds hep , I drop some of these in between usually or lose interest. For eg: the technicals study has been in my bucket list for long , but I have not made large inroads so far.

[Dr_Manoj]

Thanks a lot for sharing.

[Vivek_6954]

He Retired Early Leaving A ₹2.2 Cr Job With ₹55 Lakhs Passive Income

[abhijain]

Like the passionate discussions here.
My simple view is : quit corporate if you can match the projections on the corpus (job vs no-job) over 10 years .
There are 3 key variables: Initial amount, Time & CAGR; all 3 are equally important in the long term.

Consider 2 cases here for a person with Current corpus of INR 7.5 Crores :
Case 1:

• He is currently working with a large corporate at a high CTC
• He continues to work for next 2 years, saves INR 55 lacs/year after expenses in 2026 & 2027
• He is at current corpus of INR 7.5 cr and is able to generate a CAGR of 13% for the next 10 years( equivalent to roughly Sensex CAGR from 2000 to 2024)
• Assumes he quits corporate job at the end of 2027 and for the next 3 years(year 3 to 5), he funds his yearly expenses from his savings(INR 25,27,29.2 lacs respectively, after taking into account 8% inflation)
• Year 6 onwards his venture starts earning money so he is break-even in year 6( earnings= expenses); year 7 to 10, he is able to save INR 10,15,20,25 lacs respectively.

The corpus at the end of 2035( 10 years from today) comes out to be INR 28.75 Cr

Case 2:

• He quits the corporate job at 2025 end and starts full time investing as well as sets up his own venture
• Here, he is able to generate a CAGR of 15% for the next 10 years( 2% alpha generation as compared to Case 1)
• Year 1 to 3, he funds his yearly expenses from his savings(INR 25,27,29.2 lacs respectively, after taking into account 8% inflation)
• Year 4 onwards, his venture starts earning money so he is break-even in year 4( earnings= expenses); years 5 to 10, he is able to save INR 10,15,20,25,30,35 lacs respectively.
• The corpus at the end of 2035( 10 years from today) comes out to be INR 30.88 Cr

He is at a surplus of INR 2.14 cr in this case

My Inference:

• Do not only look at one aspect: monthly paycheck, even when it is high
• There are 3 key variables: Initial amount, Time & CAGR; all 3 are equally important

Feedback and views invited here. Also my question to the ones who have already quit the corporate bandwagon. Are you able to generate an alpha of 2%+ from being a full time investor? Please provide a frank and honest opinion

Look at the calculation below:

[bhavveshh]

@abhijain

to 10, he is able to save INR 10,15,20,2

Hi,
IMO, you should not quit your job if you are confident of 2% alpha or even 5% alpha. I think you should look at atleast 10% alpha by investing in themes, micro caps, small caps. If you want 2% more alpha, try figuring out best mutual fund or find a very good portfolio manager (with a skin in the game) and a relatively small AUM size.
Secondly, quitting job and being on your own brings lot of freedom and focus. You get better at investing as time goes by- you know far more companies than if you are doing a job.
I think time in life is invaluable (spoecially when you are younfer). A book called “Die with zero” details some thesis if any one is interested.
Lastly, it goes without saying that fixed income from a job has its own advantages and full time investing is not for everyone.

[Investor_No_1]

Just an out of box thought…Had Warren buffet or for that matter most well inown investors been working in a normal job/business (not extreme toxic ones) would their wealth generation been any lesser? Returns may have been few percentage here and there…
Damani is the owner/founder of a demanding but non-toxic business for him but still one of the best investors of all times.
RJ used to breathe stocks and hence his business was market related, however had he been doing any other non-toxic work, high probability he would have still had his Titan!

Point is, maybe full time investor is over rated (in terms of wealth generation via investing. Getting time for yourself by leaving job maybe a different topic). The main aspect is staying away from toxicity in whatever you do, that is if you do other than investing.

For traders I agree that dedicated time to market is needed which may clash with even ton-toxic work.

Disc: I can be wrong in all my thinking above and examples cited are only for improving understanding.

[Ferrari1976]

I agree, I tend to believe that (converted) full time investors are actually running away from a toxic job/business. Investing does not need 100% of your time, focus and energy. I am a registered advisor and can say this with good conviction that without the task of running the business, I would have been bored.

In cast you decide to become full-time investor, do target for something like a CFA or other allied education. That will really help.

[sandeep17]

Right. Also, if you think about it, Warren Buffet never left his job to become a full time investor for his own funds. He was running Partnerships which in just 4 years became one single firm. He was getting a share of the profits plus some fees.

And this is the broader point. Full time investing as a Professional endeavour is only when Investing is a service for others for which you get compensation. If its just your own funds ( which will anyways be invested even if you are in a job ), then full-time investing is more about you not wanting to be in a job.

[Ayush_Singh]

"Investing does not need 100% of your time, focus and energy. "

It depends on the individual , there are immense information lying around to read , stocks to analyze around the world that it even if someone have 100 hours in a day it would be less.

Full time investing as a Professional endeavour is only when Investing is a service for others for which you get compensation. If its just your own funds ( which will anyways be invested even if you are in a job ), then full-time investing is more about you not wanting to be in a job.

Again depends on the individual and situation .
Assume the money is not yours and it is of a company and has hired yourself as a professional and you are charging 2% as salary .

Consider the company has 25 cr. and it give 2% to manage it equivalent to be around 50 lakhs. post taxes, which should if nearly equivalent to good salary.

And if the company is paying someone 50 lakhs. . It would expect the person to dedicate his/her full time into studying markets, identifying opportunities and give right suggestions during market cycle .

[abhijain]

I think you got the message or the inference completely wrong. What I was trying to put forward is that no matter the paycheck is INR 1Cr+, if someone has acumulated a significant corpus, then even a slight alpha of 1.5 to 2% can outperform the savings from stressful job for the next 2,3,4 years over a 10 year horizon.
Everyone looks at the money inflow at the end of the month from paycheck but not the “R(rate of return)” or the “long term horizon”.
The premise is not about full time investor etc but thinking holistically, does it make sense to slog, fret out for next few years once a sizeable corpus(FIRE number) is attained.

Investing or finance is always personal and varies from person to person.
However, IMO, one has to be conservative post becoming full time investor. It is ok to double your money in 4 to 4.5 years( with 15 to 18% CAGR) rather than risking the capital and thinking of doubling in 2 to 3 years(24 to 36%), which is in most cases carries huge risks and does not happen.
All you have a competition is with yourself. If someone is 45, then how big difference does it make if money doubles by the time you reach 49 yrs or 50 years.

Anyway, each individual is different. So, each of us are entitled to do what suits them..

[Dr_Manoj]

Thanks a lot to all the contributors,I really learnt a lot from their views and insights. I want to add a few points absolutely based on experiences of a few of my friends, acquaintances and myself.I have found full time traders and investors opting for this due to reasons like:

1. Most of the jobs demand 12 to 14 hours everyday inclusive of transportation time, getting ready for the day, communication during non-office hours.In such a situation, reading and analysis is not easy.
2. Many people compared their income from trading with the salary they can get while in job. They concluded that income from trading/investing being at home is not less than salary they get minus expenses (transportation, owning maintaining lifestyle comparable to peers etc.)In addition, the skill set developed is compounding every day till they are alive 85/90/95 years, no retirement at 58/60/65 years or changing job difficulty after 50/55 yrs.
3. When you get a good experience of equity probably of 3-4 years, you can apply the same knowledge and skills in commodities and other markets where time every day is very long more than double of equity.
4. Once you create a system of getting more than your monthly expenses ,the compounding by investment, freedom from office politics, peer FOMO and rumours of job losses and bad bosses go a long way in making life better.
5. The success in market is related to passion. And, when there is passion the profit doesn’t remain the only motive. One gets the high or satisfaction like an artist or sportsperson.Definitely, the development of passion does not happen in weeks or months, it requires time and patience.
6. While in job one has to think of where to invest ,for full time equity professionals it is taken care of by the division of long term and trading portfolio.
7. In a few cases, people lost the job due to health or familial emergency and getting back at the satisfactory level became difficult or too compromising like reporting to people very junior in knowledge, exposure and understanding. So, they felt comfortable doing trading/investing even if it meant sacrificing yearly hill station visit or other perks for a few years. But, the golden point is once a person develops the passion and technique he can use and hone it till the end of lime with compounding.
8. Lastly,I have seen people succeed in this field if they have followed Bruce Lee’s advice " I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times." But, selecting that one kick requires time patience.