10:1 margin

Why doesn't the SEC allow 10:1 margin and reduce the minimum amount to $5000 to daytrade US stocks?


Having $25,000 in your account brokerage account makes it too temptating to have overnight positions and blow up account.

if you are just daytrading you don't need $25,000 cash to make a livign daytrding with 10:1 margin.

I guess they want you to deposit more money and lose. fuck the SEC

 

Trade financial, interest rate, metal, energy and agricultural futures instead.

 

Why would you have overnight positions if you are daytrading on margin?

I close my positions before end of day. with the exception of my other account holding longterm investments etc..

 

futures have more slippage and spread. and unless you have big account...you can lose a lot pretty quick with futures. if your account is only $5000.

 

futures are a lot harder to make money trading it short term intra-day orswing trading...your stops get stopped all the time.

 

are you saying that there are no stocks that are not even worth the risk of holding it for more than 1 week.

only reason you want cash is during intra-day you get larger margin..if you have stocks it reduces buying power.

 

10-1 margin? Thats a disaster waiting to happen. A 1% loss becomes 10%.

 

it doesn't matter what instrument you trade. trading is trading. if you find it hard, then try different markets until you feel relaxed, make it easier for yourself.

find your soft game and exploit it.

Some people prefer trading futures over stocks. I prefer futures because I don't have to deal with PDT, scanning for trade setups is easier (just a handle of markets vs. 1000s of stocks) and no messing with ECNs. FIFO and no market maker games, (if you trade RTH along with the PIT traded contract)

Margin won't blow you up if you learn to respect it and use it wisely. If you have a 5000 dollar account, go to a broker who gives you 500 margin trading the mini dow or ES. Then you trade ONE contract and continue to do so until you double or even triple or money.

Ohh and that comment about getting stopped out all the time. If you set your stop at a certain location, its for a reason. Your trade plan called for it. If you get stopped out, its not a big deal, just look for the next trade set up.