Do you need money to start with Trading?
Do you need money to start with Trading?
One of the most mistaken questions i ever experienced in Trading. People who want to sell their products on your good-will and belief say: "You dont need money to make money on the stock markets!".
Well, that is kind of right, kind of wrong. And i will tell you why!
First: Why is this true for a certain idea?
On stock markets, you can create a trading account with nearly no money. Brokers start to give you access with $10 to trade CFD or Nano-Lots, the smallest form of Forex-positions. So yes, you can start with these $10. And you can make money with it. Of course it depends on your Trading skills and your strategies, but even more on your risk-willingness.
If you stick to certain risk-management systems, most of them will not suggest that you risk more than 5-10% of your account, which means: $0,50 to $1 per Trade. As you can see: You can make money, but about $1-2 a day, when everything runs perfect.
But if you want to get $20 and more out of your $10, you have to risk 50%, even more of your money. And of course: Especially as a beginner your hit ratio is not that high. So there is a huge possibility that you get a loss trade. Imagine, it is the one trade you risked 100%...
So making money with a 10 Dollar Account is somehow possible, but thats more like gambling and taking the all-or-nothing shot.
Second: Why is this statement wrong?
Well, as you can see: You can make money with these 10 bucks. But usually, people do not go to the stock markets to make a profit of a few dollars a day. they expect a bit more. And this is totally understandable. But without having a bigger account, these amounts of dollars will never be seen by a trader except for the fact he or she is risking the whole account for some trades.
To make $100-$200 a day one should have a minimum account of $1000. And that is the minimum! It is the edge of risk i would consider to take. You have to be true to yourself: Are you that disciplined in the beginning when trading stocks? Are you that experienced so that you know how to trade?
If not, then you should go on slowly and first take care of your trading knowledge and good strategies except for the "one big shot". You should know: Trading is a marathon, not a sprint. But it is worth it. Because if you made it through the goal, your life will completely change.
So my advice: First, learn how to trade the markets seriously. Second, start with small money to learn the emotions associated with trading. Third, do a side job to grow your money for saving.
And last but not least, use the knowledge you gained and get with bigger money in the market!
Good trades,
Dominick
One of the most mistaken questions i ever experienced in Trading. People who want to sell their products on your good-will and belief say: "You dont need money to make money on the stock markets!".
Well, that is kind of right, kind of wrong. And i will tell you why!
First: Why is this true for a certain idea?
On stock markets, you can create a trading account with nearly no money. Brokers start to give you access with $10 to trade CFD or Nano-Lots, the smallest form of Forex-positions. So yes, you can start with these $10. And you can make money with it. Of course it depends on your Trading skills and your strategies, but even more on your risk-willingness.
If you stick to certain risk-management systems, most of them will not suggest that you risk more than 5-10% of your account, which means: $0,50 to $1 per Trade. As you can see: You can make money, but about $1-2 a day, when everything runs perfect.
But if you want to get $20 and more out of your $10, you have to risk 50%, even more of your money. And of course: Especially as a beginner your hit ratio is not that high. So there is a huge possibility that you get a loss trade. Imagine, it is the one trade you risked 100%...
So making money with a 10 Dollar Account is somehow possible, but thats more like gambling and taking the all-or-nothing shot.
Second: Why is this statement wrong?
Well, as you can see: You can make money with these 10 bucks. But usually, people do not go to the stock markets to make a profit of a few dollars a day. they expect a bit more. And this is totally understandable. But without having a bigger account, these amounts of dollars will never be seen by a trader except for the fact he or she is risking the whole account for some trades.
To make $100-$200 a day one should have a minimum account of $1000. And that is the minimum! It is the edge of risk i would consider to take. You have to be true to yourself: Are you that disciplined in the beginning when trading stocks? Are you that experienced so that you know how to trade?
If not, then you should go on slowly and first take care of your trading knowledge and good strategies except for the "one big shot". You should know: Trading is a marathon, not a sprint. But it is worth it. Because if you made it through the goal, your life will completely change.
So my advice: First, learn how to trade the markets seriously. Second, start with small money to learn the emotions associated with trading. Third, do a side job to grow your money for saving.
And last but not least, use the knowledge you gained and get with bigger money in the market!
Good trades,
Dominick
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