%% LOL, an honest rebuke. My teenage gambling, crypto, crypto cr@p\ i would not add to that. As a teen gambler i noticed stock market bids/ask spread were not a killer \ but big trend comissions back then could be a big problem for beginning learning trader LOL Investments dont have a comission problem ; unless one live in a high crime big city, i would not add to that loser also. Good truth tellin' post.
Based on my experience, I found it beneficial, to begin with a smaller account size. This approach allowed me to gain valuable experience and practice employing various strategies. One significant advantage of starting with a smaller account is the reduced financial risk. By limiting the initial investment, potential losses are also limited, safeguarding beginners from significant financial setbacks. Moreover, the psychological aspect of trading should not be underestimated. Emotions can play a significant role, particularly when real money is involved. By starting with a smaller account, I was able to navigate the emotional challenges of trading with a more measured approach. Learning from mistakes became an integral part of my journey, gradually bolstering my confidence in decision-making. Overall, beginning with a smaller account size serves multiple purposes. It mitigates financial risks, provides valuable practice opportunities, and fosters psychological preparedness. As traders gain experience, they can gradually increase their account size, armed with a solid foundation of knowledge.
You may be missing the big picture about trading. Here is my eagle's eye view... https://www.elitetrader.com/et/threads/how-to-calculate-success-rate-of-our-trading-strategy.374681/
Assuming you are talking about day trading stocks: Once a beginner thinks he is ready, he should be trading no more than 100 shares at a time, for obvious reasons.
What obvious reasons? Wouldn't a percentage of capital or a dollar amount be a more reasonable limit?
In some cases, you can reduce your risk by having more capital. For example, trading a long/short stock position in related names. You can lever the difference of two related stocks. While requiring more capital, this may in fact have less risk on a gross exposure/notional basis. Buying an S&P sector, and selling a different sector (or basket of stocks) is an example. You can also qualify for portfolio margin with a large account, which in some cases reduces liquidation risk, or opens the door to some interesting risk management strategies. Long/short, beta neutral, or relative value are examples.
Another option for smaller account sizes is diversification. By spreading your investments across different asset classes or sectors