What to trade?

Discussion in 'Trading' started by lexiii, Jun 28, 2007.

  1. lexiii


    Hi everyone. I've started to trade in 1997. Wasn't that bad that time, but I had a small Account and the Commissions were eating up my gains.

    So I quit and took a long break. I started to trade again about 2 months ago.
    But I have one big Problem. my Account is smaller than 25k, so no daytrading for me which is a real pain in the ass, even if you don't want to daytrade you may want to exit a position quick.

    I like to trade the Qs and QQQQ Options.
    IB is my Broker and I like the low commissions. So I've been thinking about trading in European Markets. I live in germany and I really don't like to work until 10pm each day.
    If I would trade in europe I guess the daytrading rule does not apply, so I could daytrade with less than 25k.
    There is one Problem though. Commissions seem to be too high. Option RT is 4 Euros instead of $1.50 in the Qs for instance.

    Is anyone having any suggestions on what to trade? I have only a few thousand Bucks.
  2. You can swing trade. Your trades will typically last 3 days, and you can still exit quick enough to avoid losses, if a correction were to develop.

    Buy some index ETFs like the QQQQ you have traded before.
    For small amounts of money, IB has a minimum of $1 for US markets. This is way below the 4euros you stated.

    When swingtrading you don't have to be "glued" to the computer. In fact when I have trades opened just check quotes about 3 times a day, taking under 2 minutes each time.
    When I'm waiting for a rebound and don't have trades, often just check it once a day. So, I advise you to trade US markets, even given the very distant time zone.

    When you have some 6 months having profits, you can boost your portfolio selling some puts along your long ETFs (when you're bullish of course). When you're bearish you don't need much leverage, since markets fall faster. QID gets enogh leverage.

    Only when you've mastered the long ETF + short call, you can get into options. Getting into options right from the beginning is a sure way to lose money.
  3. lexiii


    thank you crgarcia.

    I think you're right. I should stay in US Markets.
    I've also been thinking about currency trading.
    I have a Papertrade Account at IB, so I might test that for a couple months.

    I have no knowledge about currencies though. Are there any different rules in Currency Charts?
  4. I'm not into currencies, and doubt I will ever be.

    It's best to master only one thing.
    For example I only trade index ETFs, and I'm not interested in picking individual stocks.

    Definitely paper-trade for a few months, preferably one year; before betting your hard earned money.
  5. If you only have a few thousand bucks you can trade the NQ's (Nasdaq E-Mini Futures). I would not trade more the 1-2 contracts though.