"The benefit of going down the trader path is that you dont lose as much capital initailly..? (if you have a bad year and have another income)"
Like I said, if the market goes up next year, and if you continue to use the market value method, you will be paying back the capital you thought you had "saved". You can switch to a cost method for next year-end's valuation.
As you can see, there is flexibility. Go and see an accountant and talk over the scenario.
