Trading for a Living (Capital Required)

Ray,

If you can't make decent money with $25,000, then why would you think you could do so with $100,000 or more?

I guess it depends on your definition of really good money. If one can make $300-$500/day with $25,000, then he should be able to make $1,200-$2000 or more with $100,000 account.

For me personally, $300-$500/day is good enough for starters. That's $72,000 to $120,000 per year income. Then, once you build up your capital, you simply increase the number of shares you trade, and up goes your income.

But I would definately say, one does NOT need more than $25,000 to begin with. Especially with the beat down stock prices today, you can easily trade in lots of 100-500 shares of the most expensive stocks.

 

Interesting point. Reality check. If you think you can make
$300-500 a day CONSISTENTLY, then I think you are a super
trader. The pitfalls of daytrading is that markets change
weekly in the way you can squeeze some profits. You would
constantky have to change your style of trading to keep
abreast of the market. I am more with the guy who is a position tader and made $25K profit trading, for that you
better move to the (ex)eastern block and trade from there.
There is it's good money !! Even the pros who would recommend $50k will have you leveraged 5 times or 10 of that
so in reality you are trading huge !!! At home with $50k
you can do ok for a while, but my money is on the MM's that
they will have your money sooner or later....

 

Andrasnm,

I have to disagree with your statement that one needs to constantly change his strategy. I happen to follow the methods outlined in Tony Oz's book, dealing with support/resistance trading.

The concepts of technical analysis don't change week to week, or ever for that matter. One thing I've noticed is that in today's market you have to take your profits quicker than in the previous, trending bull market.

I believe that if you don't have one or two primary strategies that you use on a daily basis, then you'll just be hopping from one strategy to the next, in desperation, while your funds are depleted.

I used to scalp cheap, thinly traded issues on NYSE/AMEX. I used one single trading method and consistently made $500-$650/day. Unfortunately, decimalization ruined my system.

For me personally, Tony Oz's system is fairly easy to grasp and makes sense. I'm determined that in several months I'll be taking at least $300/day out of the market. That doesn't mean I won't have losing days. It just means when I take my total profits for the month and divide by 20, I'll come up with at least $300/day. And after trading successfully for a few months, I'll simply increase my lot size and double my income.

This is exactly how I developed my previous strategy. I began with trading 2,000 share lots, then increased that number to 5,000-10,000. If you know over a certain period of time that your system is profitable, then there is no reason not to increase your lot size. And what other business in the world makes it so easy to give yourself a raise?

 

I agree with mgregor. I personally trade from home using a $50K account, and have done so for almost two years now. While I certainly had my "learning curve" at the beginning and had to make up the losses, I consistently pull profits from the market, and as long as you stick to your stop management (the one biggest reason traders fail), you won't get kicked out of the game.

You also do have to change your expectations for what kind of profits or point moves to expect, but as far as fundamental strategies go, basic chart reading and support/resistance methodology works in any kind of market because it is based upon human psychology and behavioral patterns which never change.

 

You won't hear any argument from me guys - as for bearer of
bad news, noone likes them. I wish you all the best, and you
have my admiration for courage and tenacity. As for statistical norm, I have been doing something for ten years
and now I have to adjust to the changing market conditions.
If you can do without that in the markets, "my hat's off to you". Certainly Tony Oz is a class act and a superior trader.

 

To-eaches-own, he was asking for opinions, and I gave mine.

 

I was invested as many & was wiped out.I Had enough pocket change left to try day trading(25K). I hate to say this but I have been making more off shorts than I ever did going long. Honestly a year ago I never dream I would be a scalper up or dwn. It still blows me away. Just the few months of daytrading experience I have picked up I will never be invested in any market anywhere anytime. Thank god for daytrading.
New guy surviving