Hello everyone!!!!

Many thanks to dave for the vids and website to get free software.

I have a question.

As a beginner trader what is a realistic amount of money to start trading with where you can get worth while returns???

I have just started trying some of these virtual stock market games online and although its very easy to make thousands with 100k or 500k to play with. I tried doing it starting with smaller amounts of money and the returns are nothing special. Then with broker charges and other fees I dont see it as possible to make great returns investing a few thousand pounds???

Also am I right in thinking you pay the broker a fee each time you buy and sell??

Thanks in advance for any replies

John

Hi John,

Welcome to the site glad to see things are working for you and that you are enjoying the videos.

I have done a video which gives my answer to this question which you can find here:

Profit Expectations: What Millionaire Traders Know

If anyone has other input on this whether agreeing or disagreeing with my thoughts please post them here so we can all learn together.

Thanks again for contributing to the community and feel free to post any other questions.

Best Regards,
David

Hi,

A little hard to answer the first part of this question: stocks or futures? :-)

To the second part, brokers charge for buying and selling - in futures called a 'full turn' or 'round turn' (buy=half turn, sell=half turn). The full turn usually just includes the broker's commission (variable depending on brokerage) - so it's important to add exchange fees to the figure to get a final amount.

the seeker

Hope You don't mind me posting here.

My English is poor but I understand it better than I write it so don't worrie if/when replying.

I've been saving for some years and luckely there's a eerhm (stockforrookies company)? in sweden called "Aktiespararna" which try incourage average people(especially those of us with low income and students) to tend to our economy and they offer various ways to do so.

Since my pension gonna suck i decided to try increase that and so I've managed to with ease actually outperforming the official pensionresults so far.

It looks much betternow even if it's by no means Your or Your forumvisiters standard but since I've been reaching a point when I feel ready to try some risk trading I'm simply wondering if You or any else thinks that a good idea?

Thing is nomatter how clever i in the past tried to be it tunes out longterm investement pays the best in my case. I have also managed to cover my origin investement in a couple of papers and kept the remaining in the very same as for free. Unfortunately they've also turned out to climp to higher levels should I still keep them or should I sell even them?


Thanks fo Your excellent videos the makes all that litterature I got more understandable.

I still will save a monthly sum as I always done but wonder if You think I'm to use the extra money I'm saving to try trade?

J77

If you're talking pounds sterling and trading UK stocks then I'd recommend £4-5k as a good amount for trading, less than £2k to start with is tricky.

Depends really on what you want to do ie trade or invest. But if you're on 2k and the stock moves 10% then after brokerage and costs etc you'd get about £170 - which is pretty good if it's within a few days. But the challenge is significantly harder when you have small positions. Probably better to start smallish and work your way up with consistantly good trades first, then maybe pump in some more. Also you can get great results with a few thousand pounds. Good returns are relative to how much you have invested and over what period imho.

There is a thread called 'UK brokers' on here you should check out.

In my opinion, any profitable trade is worthwhile. Any negative trade is also worthwhile because you always learn more from your mistakes!

J77,

I encourage you to start with the smallest account possible. The two most common mistakes are:

a) novices assume that they will make money. They do not consider the possibility of losing
b) novices usually do not have a trading plan

I suggest that you first prove your ability to make money in a live trading account before trading large sums. Everyone who has traded for more than a few months knows it is possible to lose at any given time.

If you do make money, you are only out time and phantom profits. If you lose, it is always better to lose $2,500 instead of $250,000. The markets will be around tomorrow and next year - don't jump in the deep end until you are ready to swim.

__________________
Shaun Overton
OneStepRemoved.com
Strategy and Automated Trading Development

hi j77,

IMHO trading success is not dependent on initial amount of money invested... it is much more question of money management (number of positions, position sizing, using stops loss limits, keeping some cash for buying opportunities, ...), experience, time invested for watching the markets etc.

... and i would suggest to find a cheap online broker and invest just in stocks, indexes, ETFs and the like and i would not suggest investments in highly leveraged products like CFDs, options, ... why? well, if 'your' stock drops 10% so you have lost 10% of invested capital. by investment in CFDs or options you would probably lose all money invested in that minus-10%-scenario :-)

good luck,
j.

Hi There,

Thanks for the comment I am glad you like the videos and we are happy to have you posting here.

It sounds to me like you are thinking about things in the right way, putting away money for long term investment that you are going to need and then considering trading with a smaller amount of money that you would consider "risk capital".

So if this is the case and you can afford to lose that money, and you are willing to put in the effort that is required to become a good trader, then I think you are thinking in the correct way.

If you cannot afford to lose the money or if you don't want to put in the effort then I think most traders would agree that you should not trade.

Hope that helps. Feel free to post any other questions that you have.

Best Regards,
Dave