It was some time ago, that I became interested in doing stocks, and becoming a full time trader. I knew I needed start up money so I started saving every penny I was making. I now have $10,000 to invest, I know it's not much, but I'm very young, and from a poor family (this is all my money that I earned). I have been looking at some virtual trade markets, and been studying the basic terms people use. What should I do now? I want to study as much as I can before I even look at trading, I want to study for at least 6 months. -Should I find a mentor (how do I)? -Should I read books first? -Should I do penny stocks? I am not a fan of school, and planning on dropping out. (I'm currently doing an extra year in high-school). Also, what should I do with that money while I am studying? Please, do not let my age fool you, I am no cretin, and no I'm not another young man who thinks he will make a million in his first year, I know trading is an art not a science and it can be years before you see a profit. Thanks.
You should stay in school, get an education and study the markets on the side. College gives you ample time for the markets (I used to get up for the open and watch until my first class at 10am). People pay $30k-$100k for a first class education, so that $10k will most likely end up being part of your "tuition" (i.e: that $10k will most likely end up in someone elses hands). Don't waste your time reading about every indicator under the sun. Learn all you can about money management and risk control. Open yourself an account with a deep discount broker, get a demo account, download Ninjatrader (it's a freebie until you want to place live orders), pick one or two markets you want to follow and get yourself tons of screen time. Either come up with a system yourself or do a search for something on ET and then practice following it religiously. Your goal is to be methodical and meticiulous. Can you execute your system flawlessly over and over in all market conditions? Can you analyze your performance impartially to find your weaknesses and places for improvment? Once you can do that, start small...one share of a stock, one e-mini contract, 1 micro-lot. Now psychology comes in to play when real money is on the line. Remember, the market will be there long after you are gone. The more you bleed in demo, the less you'll bleed in life.
Many deep discounts allow you to open an account with $2k or so. Take the remainder and stick it in CDs or Bonds where you won't touch it. Avoid penny stocks like a diseased hooker. Obviously, finding someone to teach you the ropes is great, but unless you know somebody who does it, how will you know where to look? And a better question would be: "Why will they teach you what they know?" Like everything else, you can get pretty far in the markets by exercising common sense.
Don't use it all. 2k and rest in CD. You can learn cheap in this market and still make decent money if you're good. You need a cushion for 2-3 blow-outs.
If you want some guidance as well as a potential mentor, I suggest you stop by the ES Journal thread during the trading hours of 9:30 - 16:15. Just about everyone there has years of experience under their belt. Plus, futures traders are a bit more sophisticated folks than their stock brethren. If you stay long enough to prove that ure serious about learning the ropes, I'm pretty damn sure somebody will take you under his or her wings.