What if you could develop an online business which could be managed from anywhere, giving you a steady monthly income?
That’s exactly what 42 year old Martino Salvatico has achieved. Originally from Alessandria in northern Italy, Martino taught himself trading 10 years ago. In this interview he gives an overview of how he runs his online business.
Why Martino became a location independent trader
Martino’s interest in trading developed after he became disillusioned with his career in Italian NGOs.
“I worked with NGOs which supported migrants, but there was a lot of corruption. I felt compelled to leave and to try something new.”
Martino has been location independent for the last three years and is currently based in Vietnam. His total earnings are around $12,000 – $15,000 a year.
“It’s not an easy business to make a living from, because it’s difficult to make a lot of money. But it’s fine if you’re living in SE Asia, where the cost of living is low,” he acknowledges.
He normally spends about $300 a month on his apartment and bills, and $500-$600 a month on eating out and other expenses. “So it’s more than enough,” he says. “And for me, it’s more important to have free time than a luxurious lifestyle.”
He usually spends about two hours a day working on his laptop, but always has his phone with him in case he needs to make adjustments to his trades.
How he runs his trading business
Options are his preferred market, which he describes as having “less risk”.
“An option is basically a contract allowing an investor to buy or sell a trading instrument over a certain period of time. These include stocks, securities, indexes or funds.”
Martino is as a systematic trader. This means that he bases all of his buying and selling decisions around statistical analyses, rather than expert knowledge of particular markets.
“I build algorithms which allow me to analyse my trading approaches of the past. If they’ve worked for me, I set algorithms up so that they can buy and sell against similar parameters in the future,” he explains.
“A large part of my work involves scanning every possible market to check what was working in the past. This also involves controlling the algorithms. I need to be ready to switch them off if there’s evidence that the statistical results are not as successful as they were previously.”
Martino prefers to trade options because “the market is quite complex and advanced. This gives me a greater ability to set up complicated algorithms, which allow me to control the risk more.”
Why being an options trader is a bit like being a football manager
He acknowledges that the system is very complex. “To explain it in a simple way, I always use the analogy that I am like a football manager.”
“I choose and train my players: these are the algorithms. Everyday I watch them play in the markets. I get ready to call them out when they’re no longer able to function properly. If this happens, I substitute them with new algorithms.”
I ask Martino whether it’s possible to scale his trading income in the future.
“Yes, it’s definitely possible. The simple way to do that is to have more capital to invest.
More capital will allow you to set up more algorithms which you can use at the same time. This gives you more diversification, which gives you more income.
I’ve also started a collaboration with two new traders, which will help all of us to develop. We’re sharing our knowledge and the algorithms we’ve built. We have our own accounts though, and generate profit individually.”
“Another option is to teach what I know,” he says. “But developing a positive reputation is difficult. There are a lot of other online teachers making false promises about how easy trading is and how much money can be made.”
Being a location independent trader is not for everyone
Martino acknowledges that trading isn’t the easiest business to set up. “It can be stressful and it’s definitely not for everyone.”
“You have to study a lot, and have the correct mindset in terms of being able to let go of expectations,” he says. “You have to accept you will lose money and this is a normal part of the process.”
“When you fail, you accept that you did not properly manage your risk. You study where you went wrong and revise your approach.
It’s all about learning from your past mistakes and refining your approach for the future”, he concludes.
“Also, the capital you invest must be large enough to accommodate a very diverse trading approach. Because this also helps to minimise your risk.”
Socialising as a location independent trader
Martino normally spends up to 8 months abroad and 4 months in Italy. Even when he’s in his home country, he still travels around a lot, ensuring lots of social time with friends. “It’s important for me to visit my friends,” he concludes.
I asked Martino what challenges he’s encountered working in this location independent way.
“I spend a long time alone. Yes, you can meet a lot of people when you’re location independent. But they’re different to your family and friends from back home. To counteract this I go to parties, meetings and events which I find on social media.”
“Meeting new people is easy”, he says. “But it’s harder meeting new friends. Even so, I really love working this way. Trading enables me to learn something new everyday. It really opens my mind and I find that very stimulating and rewarding.”