How much of a day traders returns are based on leverage? How much is based on different accounting? You lost 100percent of your account. That wasn’t really 100percent then if you had money on the sidelines. if you took 100percent of your liquid assets (what a typical investor would employ) and didn’t have more notional than your account, what would your returns be?
I put in my account money that I could afford to lose. As an investor I would invest that same amount, not more. Depending on what you use as criteria you can always have the outcome you need to proof your case. I try to keep it simple. After the wipe out I started again with 10K. So total amount I ever invested in daytrading was 60K. Because of the leverage and the compounding I have now much more money then I would have had as an investor with 60K starting capital. Because of the high returns I also don't need to continue to compound; I could already spent a lot of money (what I would not be able to do as an investor) and still stay ahead of the investor who leaves all the profits in the investment. I trade/invest to spent money, not to grow it till the day I die.
With the results I'm getting from that small account I'm debating buying a whole lot more shares, but today's price isn't what it was last year although lithium mining seems like a pretty safe bet in terms of demand and limited supply...
Be careful, because the next generation batteries that are in research now, will all be without lithium. Some of them are already in pre production stage.
I always say in my posts to new traders, don't even try day-trading until you are profitable on the dailies.
Agree. It's like saying don't even think about learning to ride a motorcycle without having learnt to drive a car first. Two different things to accomplish the same task. Do both or either, in whatever order.
I agree, they are very different. But day-trading is harder. New traders cannot do it - or at least about 955 of them cannot do it. But the point is that if they become profitable trading long-term off the dailies, they would have a better chance of succeeding at day-trading, in just the same way that linguists always find learning the third and fourth languages easier than the second. There are common principles across both. But in any case, if they become profitable in long-term trading, why go into day-trading anyway?
After trying investing, swing trading, day trading stocks/options/futures, I find day trading to be hard, and investing and swing trading to be very very hard. So I totally gave up investing and swing trading about 1.5 decades ago. so traders have to try various things and see which one to give up (or perhaps give up everything).