Since you are planning on trading as a retail customer of a brokerage firm, with all the basic limitations involved and higher costs, I would suggest that you figure out a way to show some consistency in your percentage of profitable trades (after expenses) before settling into a mindset of "making $200-$300 per day"..or any other optimistic goal. When and if you find yourself making consistently any money (even $10 a day), you should then increase your share size to at least 1,000 shares (to cut your per share costs when paying ticket charges, and to give you a reasonable return). At this level you will only need about a 75% batting average to make the amount you are hoping for (when all the dust settles). I wish you the best of luck in your endeavor, and will be happy to answer any questions you may have. (don't worry, I am not a broker) www.stocktrading.com www.donbright.com
To make $200 net you actually have to make $350 to $400, figure in slippage, commissions, ticket charges, bullets etc. etc. etc. You have to know how to take losses before you become proficient at making money, and to do that, you have to be able to withstand consistent losses of $200 - $300 / day for an etended period of time before you start breaking even and making money. For any new traders to turn profitable, there is a " J curve " learning curve that they must overcome. They lose consistently in the begining, the steepness and the duration on the way down depends on the individual trader. It takes anywhere from 3 to 6 months to breakeven before you start to make any money. The key in the beginning phase is to learn how to keep your losers small in comparison to your winners. If you can keep your biggest winner at least 3 times your biggest loser everyday, then you can start to make money. Consistency is the key and not how big is your P&L in the first few months. I am looking forward to seeing your progress in the future.
"keep it simple, just trade QQQ for the moment. 100 shares. " I question if this is the right vehicle for a newcomer to trading. It automatically puts him up against a lot of the best traders in the business. I have been swingtrading for about 2 years and have never had a drawdown of more than about 12%. Compound return is just over 100%. I try to stay away from stocks that are the daytraders favorites and concentrate on those that have typical daily volumes in the 100,000 to 600,000 range. Many stocks that trade these types of volume are easily manageable when trading small position sizes, which is a piece of advice I do agree with for the newcomer. As I do not daytrade I do not understand daytrading and the impact daytraders have on the stocks that they tend to trade. Therefore, I try to find a niche where I am not so much subject to their influence. As an example of what I mean, Hitman reported on Friday on his success daytrading the housebuilders. Those he traded did not appear to include one that I have traded a lot, SPF. It was below his radar and that of a lot of other daytraders too I would guess. My advice is to focus your efforts on one style of trading based on one or two setups rather than trying to do lots of different types of trades. It took me 7 months of roughly breakeven trading to get a grip on trading the long side. I eventually focussed on trading pullbacks in high relative strength stocks. It has taken me nearly as long this year to get a grip on swingtrading the short side and I am still not sure I am there yet. I started with a small 5 figure account for the first year and boosted it to a mid 5 figure account when I thought I knew what I was doing. Only now am I at the $100-200 per day level with an account that has grown to the high 5 figure level. Don't expect too much too soon. I perhaps would have done better if I had been more aggressive, but avoiding losses is my number one priority. Unlike Hitman who is a 21-year old with his whole life ahead of him, I probably only have one chance of mastering this game.