Hey everyone, I mentioned trying to host a monthly AMA to specifically help newer traders as best as I can. I understand how brutal online communities can be (this isn't all bad btw, that brutality is needed and forces people to at least moderately think about things).
**For context on who I am**, my name is Erik. I'm a Marine vet and options trading is my primary income source. I started trading in 2007 while in high school and wrapped up my 18th full year of trading last year. I maintain just over a 30% CAGR for that timeframe, with my last two years being anomalies. 2023 was hands down my best year ever. Removing these two data points, my CAGR is mid 20%'s. I've had two negative years, my first two trading, both were single digits.
[My risk management lead](https://preview.redd.it/gt3ta4zn0mke1.jpg?width=3024&format=pjpg&auto=webp&s=62b025faaa9f9bca95edaf22af52e925c354a420)
I've never prioritized maximizing my returns and instead focused on achieving consistent returns. I grew up with a single, low income single mother who was a occupational therapist contractor for mentally handicapped kids, in a public school district. We always struggled with money and I knew my mom didn't have a retirement plan so I felt I needed to figure out a way to help. I became absolutely engrossed with trading and have easily spent over 35,000 hours on the skill set over my trading career. I have an obsessive personality and was fortunately able to direct it to something constructive.
I built my original trading principal from working. I focused on jobs that paid by the job vs by the hour so I could work quickly and take more work. I split wood, moved shale, sold Christmas trees, maintained a bowling alley, etc. I scaled as my capital grew, during college (I earned a Marine Corps scholarship, no change I would've afforded it otherwise) I bought broken cars, fixed, and sold them. Flipped motorcycles, etc. In my mid-20's I got into residential real estate. Late 20's I spread into commercial real estate. I'm currently 33 (turn 34 next month).
I view wealth development as (3) key levers: Savings Rate (as a percent of income), Investing, and Income Growth. We cannot purely save our way to wealth. We need to compound and the fastest way to accelerate compounding is to feed it more capital. In the beginning, our savings rate matters far more than our returns. Then, as the account scales, our returns matter far more than additional savings. Most of us get into trading thinking it will be fast easy money - this is the polar opposite of reality. However, trading for primary income is entirely achievable for those willing to put in the effort.
**Why I do this.** There are two primary reasons why I do this. The first stems from a deep gratitude I feel for a high school JROTC instructor who introduced me to the concept of investing. It's because of him, that I went to the library to learn about investing. It's because of him I quickly spread into derivatives. It's because of him I was able to retire my mother and ensure I was in a position to not just take care of her but enjoy a comfortable life. Without him and the knowledge he shared with me, I would be on literally, an entirely different trajectory. The second stems from my passion for teaching and helping other people. Growing up with limited and unreliable presence from my dad, family friends used to take my brother and I to do things. It's through this exposure to my family and family friends that I learned to appreciate how incredible of an opportunity it is to "be raised by a village". I learned to learn from everyone and feel we all should adopt this general approach to help others where possible.
**I've made a series of posts in the community to help others create their own way. I will link to several of them below for your reference and to try and make the AMA productive vs repeating things I've already shared.**
1. **Trading Options for a Living**
1. Provides a high level overview of my trading approach
2. [https://www.reddit.com/r/options/comments/1gejy0q/trading\_options\_for\_a\_living/](https://www.reddit.com/r/options/comments/1gejy0q/trading_options_for_a_living/)
2. **Stop Wandering Aimlessly**
1. Offers a general learning syllabus for new options traders
2. [https://www.reddit.com/r/options/comments/1c3hgfh/stop\_wandering\_aimlessly/](https://www.reddit.com/r/options/comments/1c3hgfh/stop_wandering_aimlessly/)
3. **Failure rate of options traders - 3 Causes**
1. Summarizes the common sources of trader failure I've observed over my time trading
2. [https://www.reddit.com/r/options/comments/1iaqtzx/failure\_rate\_of\_options\_traders\_3\_causes/](https://www.reddit.com/r/options/comments/1iaqtzx/failure_rate_of_options_traders_3_causes/)
Looking forward to a fun conversation and hope I can share some useful information.