So an $18,000 loan at 28% and $11,000 loan at 26% That's insane .... Even if this loan has to be paid back in 5 years you are looking at a minimum payment due each month at approximately $560 X 60 = $33,600-$18,000 $15,000 to borrow $18,000 over 5 years Even if you borrow the money for a year it's still going to cost you $2800 And with the $11,000 loan at 26% at 1 year is going to cost you $1600 Together within 1 year you will pay $4400 in interest The question I have is where are you getting the money to pay back these loans on a monthly basis? Each month you have to be paying back at least $750-$1000 ....is this coming out of your brokerage account?
$3000 in monthly expenses? How much are your living expenses? Does that include the money due monthly for the $29,000 in loans you took out?
thanks for breaking it down. Only income will be from my trading and $3000 monthly expenses include everything such as rent, phone bills, interest payments on my loans, etc. except food/gas/other expenses that might occur. Yea no kidding, this is a lot of risk.
Day 13: Beginning of day: $40926.56 End of day: $38341.64 P/L: ($2584.92); -6.32% lol... a big gain always followed by a big loss. 3 big gains so far and 3 big losses so far. sigh.. the day started out very strange with no good setups in any of the stocks. Went searching for new charts yet all the charts were ugly. Thought I'd put on a small position shorting VALE because i thought it had a lot of room for downside if the support broke. It didn't break haha...and covered for a loss. DUST was sitting around its 52 week lows and it seemed to me the dollar would go up and gold would go down, so bought a small position in DUST. It dropped and instead of pulling out I tried to time the bottom for the bounce and added more positions. The result? haha.... Giving myself 2- stars for today's trading. Just wasn't being patient. I keep telling myself to stop trying to time the bottom and the top, yet my eyes just go to the charts and I'm always, and like ALWAYS a little early for the reversals. Yet I tried again...and this time lost big time. Still lacking money management skills. Still too full of myself. But today's markets was just horrible... I just could not find a good opportunity anywhere the entire day. I hate days like this.
Don't go all in. Trade at least 3-4 securities at the very minimum on a given day. Or, let no security exceed more than 20% - 25% of the portfolio. If you do this, you'd at least won't see drawdowns as high as 10%, in most cases.
All of these trades occurred prior to going to work or during the work day or after work ? You said... But today's markets was just horrible... I just could not find a good opportunity anywhere the entire day. I hate days like this. Is that hindsight analysis or did you think as such during those trades ? Its a thought process you need to be extremely careful because if that was true...it implies you shouldn't have taken any trades and that means your winners must have not occurred via your trading plan. My point, be careful about your trading plan when you have profitable trades for the wrong reasons because profitable trades like that can easily encourage you to take trades that are not part of your trading plan. Last of all, as a reminder, one of the key aspects of successful trading is to treat your trading like a business. Those outrageous interest you have on those loans will not allow you to trade for a living. With the type of job you have...you should have just saved your money and downsized your living conditions to the bare minimum. Trading is hard enough all by itself. Those loans have put you into very turbulent water even if you''re borderline profitable. Tax situation...not sure what country you're in but because of your job...you can not declare "trader status" and it seems like your loans are under a personal account and not a business account. Thus, you can not deduct those high interest payments on next years taxes.
The trades are whenever I see an opportunity and in today's case, was right before work and during work. Yea I shouldn't have gone in based on my trading plan yet I thought it would be okay if it was just a small position. I'm not sad about VALE but I messed up big on DUST and that was just me cheating my plans a little bit because I thought there would be a bounce. An amateur mistake. Sigh... gave up almost all of my week's gains today.
Trading from work...that's a no no unless you're the boss and you have several hours of private time. Do you have a plan B like a dollar amount where you realize this isn't working and you'll just give back the money (what's left of it) and just pay the interest monthly of the remainder amount via your job or getting a 2nd job (part-time night job) ???