I'm not blaming my broker for any trading losses I may make. I'm taking responsibility for my own use of my own money. It's a responsible thing to accept any risks you may subject your own money to. It's not the same thing to ask others to accept those risks. I can't ask others to accept the risk that they may lose money they entrust to me.
If you CAN SHOW others that you have the ability to earn excess returns given the added risk exposure you may have to take, there will be people who will invest. I raised my money that way. In other words, if you show others that by accepting those risks, they can earn substantial returns and if you have smth to back those claims, there will be funds. It seems that you are not confident enough to believe you can do it. If so, should you be really trading???? Again, as I said before, get together with other underfunded small traders, form an LLC, and trade the portion that belongs to you. You may have to pay for extra terminals, that's it. Plus, you will certainly have to make sure that the legal details are all in place in case someone blows all the money etc.
We don't all have the same abilities and we don't all have the same faults. I shouldn't have to be expected to be able to do the things you can do, and I shouldn't have to be punished for the actions of others who may have blamed their brokers for their own losses. Maybe you find it a simple thing to raise funds and start a partnership. Maybe it's not so simple to me. I don't expect you to be punished for things that I do, and I don't expect you to be able to do everything I may be able to do.
TM Direct Don't forget me!!! Ha. I'll take $50,000. Greatly appreciated. Like Wimpy the hamburger guy from Popeye fame I'll pay you back a week from Wednesday. Wasn't that what he used to say? Ha. Actually the more I think about this the more I feel the government should subsidize a program to encourage the poor to day trade their way out of poverty. They could have HeadStart type programs teaching people how to trade and have an initial grant to start with and then a monthly stipend to help with commissions etc. A little humor.
Great idea! Why cannot a broker put up some frozen fund/equity in the account for us? That's is a very encouraging step as cooperation with clients who kindly pay commissions as much as they can. This gives NASD/SEC no execuse.
Don't know why this keeps coming up. The purpose of the rule, as I understand it, is not to protect the trader (funny how everything always comes back to "me, me, me"), it is to protect the clearing firms. It may or may not be the "real" reason for the rule. The following rule is from the NASD and was approved by the SEC. Although the day trader may end the day with no position, the day traderâs clearing firm is at risk during the day if credit is extended. To address this risk, the NASD and NYSE require day traders to demonstrate that they have the ability to meet the initial margin requirements for at least their largest open position during the day. Specifically, under current margin requirements, a customer who meets the definition of day trader under the rule must deposit in his or her account the margin that would have been required under Regulation T (i.e., the 50 percent initial margin requirement) if the customer had not liquidated the position during the trading day. If the customer day trades, but is not considered a âday trader,â the customer is still required to post 25 percent of the position held during the day.4 Currently, this payment is due after the risk has been incurred. Therefore, the funds are not available during the trading day when the clearing firm is at risk. Currently, if a customerâs day trading results in a day-trading margin call, the customer has seven days to meet the call by depositing cash or securities in the account. Because day traders typically end the day flat and this day-trading âmarginâ deposit is not securing a margin loan, the customer is not required to leave the margin deposit in the account and may withdraw the deposit the day after the deposit is made. If the customer fails to meet a day-trading margin call, no specific action to the customer account is required to be taken by the firm. There are no securities to liquidate, as there would be for an existing position, because day traders typically end the day flat. Description Of Amendments The amendments address the deficiencies that have been identified with existing rules relating to day-trading margin activities. Specifically, the amendments provide for the following changes to current margin requirements........ . $25,000 minimum, etc, ...
One last idea I've just come up with. Putting all the posts on this thread together I've come up with this: I'll sue the traders on ET for giving me such bad advice and causing me to lose all my trading capital. "Yes, Your Honor. Things were really going well and I had raised all the money I needed to help my Grandmother have the operation she needs until I became a member on the Elite Trader boards. Here's my trading account to prove it, Your Honor." This is the way I've decided to raise the necessary $25,000. If you read all the posts in this thread and put 2+2 together it makes perfect sense. Time for a break. Enjoy your evening everyone.
That's very true. Thanks Rigel. Let's focus on this issue. Then why they use the number of day trades for the protections. If I day trades 4 times of $200 value in a $2K account, no brokers and cleaning firms will be harmed. On the contrary, if I day trade 40 times of $2.5K value in a $25K account, I bet there are more risks to brokers and cleaning firms. The situation is also different between cash transactions (e.g. stock options) and margin transactions. Number of day trades is not appropriate. So, the rule is illogical.