You haven't considered that trades in a cash account take 3 days to clear. The MAN has thought of everything to keep YOU from playing. It's for your own protection, you see. P.S. Better work some overtime at Macee' Dees'.
Littledrummerboy, Don't let the new daytrading rules discourage you from trading. You don't have to daytrade to be successful. You can take a swing trade approach and hold for 2 to 7 days or a position style and hold as long as the trend is Intact. You have a long way to go in the "trader evolution process", Just remember a few important rules. You don't have to be right more then you are wrong to trade successfully. You must however make more on you winners while keeping your losers to a minimum. Trade with the trend, at least while learning....This will sometimes bail you out of a bad entry. In order to trade with the trend you must define what the trend is to you . For me, a stock in an uptrend is a stock that is near a 52 week high, no more then 15 - 25 % away... and is making higher highs and higher lows. Take a look at DRMD....This has been performing perfectly for me. (Opposite for shorting....) I like to enter an uptrending stock that has pulled back and has demonstrated support, in other words putting in a higher low. Do I have a way of knowing if the higher low will be the real one ..... NO, no one does ......but this gives me a place to put my stop in order to limit my risk. Another key to trading is not to bet it all on one trade. You will have a problem here because you are undercapitalized. An easy way to do this is to divide up your capital. Lets assume you have 20,000 to play with. Divide up your money by at least 10 .....that would enable you to bet 2000 per trade. 30 dollar stock would get you 66 shares...A 10 dollar stock would give you 200 shares. You are using 10 % of your capital per trade but this is not your risk. On this 10 % trade you must place risk stop. There are many way's to do this and there is no one universal way that I could say is the best. How I do it is by placing a stop under a support point while trying to keep it in the 5 % to 6% area. If it much further away then this I will enter a smaller position to compensate If I really like the trade but I will usually wait or scratch the trade. There are hundreds of new trades coming my way so If it doesn't fit my "mold" I won't break the mold...instead I scratch the trade...... By doing the above and exiting all trades in the 5 to 6 % area you are in effect keeping your portfolio risk constant at a .50 % to .60% risk level. Your goal would be to keep your losers at that level while letting you winners run to at least 12 to 15 %. Keep your Risk reward over 2:1 Everytime you lose it will be .60 % of you capital. Everytime you win it will be 1.20 % or better. You can then be wrong 66% of the time and still be in the black. Also by dividing up your money into 10 Your overnight risk is diminished. Suppose a stock you are in tanks by 50 % due to bad news in the PM... you will only suffer a 5% hit...hardly a destabilizing loss... eventually you will catch those trades that will be 5 ,10 times your risk and you will have a nice return.....But you must survive until the tide turns you way....You MUST PRESERVE YOUR CAPITAL and be around to play when thing are going your way. As Paul Tudor Jones and many other great traders say...Play great defense not great offense. I took me 9 years to realize the importance of playing great defense..... I guess I have a big ego....I was on an endless search for the perfect system. I have spent countless days and nights looking for the secret.... The one the winners had. There is nothing wrong with this, It's part of the "Trader evolution process" I just happy I'm out of that era in the evolution scale....I have finally discovered how to stand, now I must try and see if I can walk..... So far so good. Nick
The only problem with IB in your case, is that they require you to trade minimum 100 share lots on NYSE/AMEX. With under $500, that will just about eliminate most stocks over $5. Unless you want to trade striclty NASDAQ stocks, this will greatly limit your trading horizon if you decide to use IB. For NASDAQ, though, they currently have the best commissions.
l d b, unless you open a joint account you will not be approved by IB. You need to be 18+ to open a cash account. 21+ for margin. sorry, but those are the rules.