I'm a college kid. I just started trading stocks every other day from my dorm room, (sometimes back-to-back days if perfect opportunities are presented). Anyways I was reading a post below. The author was talking about how they are looking for opportunities instead of opportunities presenting themselves. He was being impatient with his plays-exactly like I was last week.
LONG STORY SHORT, if you find yourself having a problem trying to force trades, just remember this post. Remember it because it outlines just how fast you can grow your account using perfect opportunities. Granted it's a bit lengthy, but it's worth a read. Especially for those with small accounts like myself. Here is the copy of my post below:
"I just made the typical newbie trader mistake of giving back everything I've earned in one trade. It took me a while to realize what "sticking to perfect plays" really meant. Let me set up a hypothetical situation for you, now be aware that this will most likely not happen, to anyone. You have a $2500 account. If you were to only stick to the PERFECT PLAYS (50% return), and never risk more than half of your portfolio in any one trade, in 12 trades your account will be just below 30k (29106.25). How soon until you reach 100k? 17 Trades. Your first 100k trade? 25 Trades. Finally make it to the million mark? 28 Trades. 28 Trades will take you from 2500 to 1 million, (1,034,061.99). Granted 50% return consistently is probably impossible, it still gives you an idea of how much you can make in such a short time. Hope this helps. Slow down, clear your mind, get back at it when a PERFECT opportunity is presented."
Thanks everyone. Please comment as it took a while to work these numbers out. But for anyone who wants to figure their own numbers into this, the equation I came up with is:
- S/p=v
- v x P = r
- r+S = V
In this equation:
S = starting balance
p=percent of account risked
v = position value
P = percentage of return
r = profit return
V = new Value
Rinse and repeat the equation until your little heart is content. Thanks everyone!
Is that the right link? That post gives no advice and no equation. The only comments that reference it are your own.
@Shaz That's a link to the original article I mentioned at the beginning of the post. Everything else is in this one.
This is especially true for small accounts! Lock in profits when you have them, no matter how small they are! This is what I keep telling myself every day before trading but with a small account I keep finding myself pushing the boundaries and most of the time ending up taking a loss instead of a small profi! A 5-10% gain is better than a loss! Good read!
@BruceC Thanks! And you're right. Take the money.
Join now or log in to leave a comment