Something does not add up in wabu's story. First, he said this: And then, this: So, how is it possible for wabu's dad to bail wabu out, if the dad is supported by wabu?
You are young. You will recover from this, get another job, the economy is good. I been in worse places than you in the past, with family & big mortgage, no job during a recession. You don't want to blow your life savings when in that position like i did. Do not declare BK for just 29K loan, that is not much, it is just like a car loan. Forget trading, get a job.
I didn't read through all the comments, but I made it about six pages of comments in and can't believe no one mentioned this: Have you looked into working in a prop firm as a prop trader? Reputable prop firms will allow you to trade firm capital for a cut of the profits, especially if you have some money to put up. I think it's absolutely 100% a terrible idea to trade with funds that you borrowed paying 26% APR when you have essentially no real-world record to prove to yourself that it's a good investment.
Real trading is different from demo cos in demo, there is no risk so you do not have to incorporate a risk management into your strategy. Like you, I also have taken out a small loan that the amount is equivalent to my 2 weeks wage to start a real trading (it was not an actual loan though, it was some student package so I don't have to pay any interest). Real trading involves psychological issues too. Try real trading with small account first and don't rush yourself to be George Soros otherwise you could lose so much. See first if you can make consistent profits in real trading too. I bet you will not listen though cos of your positive experience with demo. But I hope you come up with a good plan.
And I cannot believe you would give such stupid advice. Are you asking him to pile on more debt? Because none of your "reputable prop firms" will provide leverage without upfront payment. That means more cash to shell out. Stupid idea.
The only thing stupid here seems to be your reply. As I said, I didn't read through all the comments & only made it to page six. Based on your comment, I figured I must have been missing something and there was more to the story, so I read some of the recent comments (I started with the earliest), and now I see that the excited young beginner trader did exactly what I was advocating he not do -- use money he took out in a load at 26% APR. It seems he did that and has landed in quite a predicament, which he will have to work to payoff. What I was advocating is based on my initial understanding of his question is and is not stupid by any means -- reputable firms will allow you to trade with firm capital after you have gone through their trading programs, and sat at their trading desk closely supervised for period of time during your training. These firms gradually turn over more and more responsibility to traders and increase their access to capital if you can show consistent returns. Had the OP done this (or had knowledge about this) he could have avoided the entire situation. In firms like this, usually the contract specifies you do not owe the firm back money of theirs that you lost -- only your own.
... Yes AFTER having gone through their "TRADING PROGRAMS" which 9/10 prop firms use as a ruse to bait the unassuming and charge 5000 usd or sometimes significantly more for. Most prop firms are con shops who charge for worthless training and then encourage people to churn their accounts in order to generate commissions. Also most such firm DO have legally binding clauses to force the making whole on debit balances on the side of the trader, contrary to what you claimed. And we have not even started to talk about any possible future payouts where a lot of such shops con again and lock up funds or discourage traders from withdrawing funds. I stand by my judging such advice as being stupid.
Sounds like you were only at the bottom of the barrel prop firms. All the ones I've been with have assumed the risk. The type of firm you are allowed to trade with is usually indicative of how well you can trade. There are indeed scams out there, but if the trader had good performance as he claimed, he could have easily been recruited into a top firm with a very fair agreement where the firm assumes most if not all of the risk with their capital. . .
This is a great example of why people are so wrong to tell novice traders that you need large sums to trade. Most everyone seems to blow out their first account, why not have that account be 2 or 3k? Plenty for day trading futures.
It was his existing high student loans, other financial debts and the high interest (26%) loans, quitting a secure job and then switching to markets he had no prior successful trading experience that did him in. 2 - 3k will blowup more quickly and he'll just do another 2 - 3k and then another and then another until he reaches the large amount of debt or trade losses. My point, I didn't see anyone in this thread recommending to him to take on a 40k trading account with all that debt that came with it when he borrowed the money. Simply, its really not an issue about proper capitalization because he had too many other problems. He just shouldn't had been trading regardless if its 2 - 3k or 40k. The good thing is that he can easily fix his problem with getting 1 - 2 jobs to start paying his debt and make debt payment arrangements with a lower payment plan.