Stock Trading

Im interested in daytrading, i have been playing the real market with fake money through facebook and have been doing well. But ive been making alot of trades. I dont have that much money to invest so spending $10 on each trade when i may make 10 trades each day can really add up. Are there any trading companies that offer unlimited trades for a certain fee? im think of starting with $5,000. do you think that is sifficiant? im not looking for huge gains, and a profit of even $50 on a trade is fine with me. i would just like to start playing the market and learn.

zecco.com will let you trade for free–I’m not sure about 10 trades a day but enough to keep you busy.

Interactive Brokers has been around a lot longer and will let you make any number of small trades for $1 each.

There is an old adage that you shouldn’t confuse genius with a bull market. Have you traded successfully through a downturn and learned when to go short or flat? If you have, and you don’t choke with real money on the line, you are a rare breed.

If you have $5,000 you’ve got to limit your number of positions. If your goal is $50 per trade, you’d need 1% return on your whole $5,000 stake on every trade. That’s pretty ambitious for true daytrading, and if you have a drawdown to $2,500, you have an impossible 2% goal.

Another issue is that if you make a few day trades in a small account, the broker will cut you off because the SEC requires a larger minimum balance for "pattern day-traders". The balance doesn’t have to be cash, it can be other stocks that you aren’t trading much.

the way I did it for myself the last 13 years and been successful at.

I am willing to do so, and i believe the best way to do it is to pool all the monies together, and thensplit the profits according to each one’s proportionate contribution.
The question is how to do so, without having the tax burden fall in me, since i wil have only one account for everybody.
I do know that Hedge funds kinda do the same thing, except that I am not managing that much money all together (230K), and it would be ludicrous to go through the burden of recreating a model initially set for people with billions.

Also, I do not have a trading Licence of any sort, but daytrading has been my only source of income for the last 13 years, and i am doing pretty well…

Any solutions?

I think there’s too much room for error here. If the investment goes bad, everyone will blame you and your family relationships will be miserable for the rest of your life.

Check if the family members could incorporate and invest as a corporation. There are also books about little old ladies who formed investment clubs and pooled their money. Something like this could be educational for these people rather than them relying on you to make the investments. The ladies would gather lots of information about companies and then vote to invest. Along the way, they learned alot too.

I set up a stock alert group with yahoo. We are doing absolutely awesome. Just check it out. My results can be found right on my group.

http://finance.groups.yahoo.com/group/WISHBIGSTOCKS/message/65

WISHBIGSTOCKS is my group name and can be found in the daytrading category in the finance groups.

Can you guys give me an honest opinion on whether our stock alerts are awesome or are we blowing hot air up our own nose.

We are consistantly giving our members, returns of 10%-50% within a few weeks. Anyone else know of other alert services giving these kinds of returns time after time after time.

Thank you

Your picks and service are great. I would like to join if you give me the link to paid service.

Keep up the good work

Thanks

I started day trading stocks since 1995. I started with about $15,000 and grew it to over $200,000 until the dot.com bomb hit in the year 2000. I ended up losing almost all of it. I started to try it again and I started with $20,000 and grew it to over $90,000 only to lose almost all of it again. I have got reduced hours at work since April so I decided to try again with only $5,000 and at this point have made it grow to $60,000. I use margin which is borrowed money and buy the most risky stocks available. I live with my mom and I told her that I feel this is Full-Time work but she feels I am expected to work at a 9-5 job regardless. I never told about how much I gained or lost. Does it sound like my stock picking skills are weak or is it like I feel more like a Full-Time job? If you were me would you continue to pick stocks on my own like I do and try to work also or shouldn’t I pick stocks at all?

Daytrading is a full time job according to the IRS.

I’ve been investing and swing trading for years. For the past few months I’ve started daytrading with a prop firm. It’s a tough game, but I’m starting to figure it out. Started out position trading on fairly slow stocks like GE, but I actually do better on faster stocks. I’m pretty much a pure scalper. I was trading XOM but it was a bit too volatile. Then I found BAC and I was in heaven! I hardly even used charts, I just scalped it over and over looking at the Level 2 quotes. Unfortunately, the new SEC rules limiting short selling apply to this stock, and I don’t want to stay with a stock I can’t short. So my question is, does anyone know some stocks similar to BAC for scalping, moves fairly fast with nice big candles, but not all over the place like XOM? Also, it must be an S&P500 stock and do over 8 million shares of volume daily. Serious answers please, don’t bother telling me I’m a fool for daytrading because I’m already committed to doing this.
To Googie:
One of us needs our head examined! I’m just asking any other scalpers for some suggestions! I’m looking for stocks that trade AT LEAST 8 million shares daily! What, are you worried that I’m going to steamroll you with my 300-500 share line? Get some friggin’ perspective, dude! I’ve given other investors and traders plenty of advice on stocks I’ve traded in the past. I never seriously worried anyone on these boards was going to take that info and screw me out of any money. If you’re worried about that, you are truly paranoid. I’m not asking for any insider information, or anything like that, for Christ’s sake!

You ever thought about trading currency? Same fundamentals, just no nosy SEC to deal with, go short go long. go both. Theres tons of sites online. lemme know if your interested. I’ll tell ya who I use

I’ve been investing and swing trading for years. For the past few months I’ve started daytrading with a prop firm. It’s a tough game, but I’m starting to figure it out. Started out position trading on fairly slow stocks like GE, but I actually do better on faster stocks. I’m pretty much a pure scalper. I was trading XOM but it was a bit too volatile. Then I found BAC and I was in heaven! I hardly even used charts, I just scalped it over and over looking at the Level 2 quotes. Unfortunately, the new SEC rules limiting short selling apply to this stock, and I don’t want to stay with a stock I can’t short. So my question is, does anyone know some stocks similar to BAC for scalping, moves fairly fast with nice big candles, but not all over the place like XOM? Also, it must be an S&P500 stock and do over 8 million shares of volume daily. Serious answers please, don’t bother telling me I’m a fool for daytrading because I’m already committed to doing this.
To Googie:
One of us needs our head examined! I’m just asking any other scalpers for some suggestions! I’m looking for stocks that trade AT LEAST 8 million shares daily! What, are you worried that I’m going to steamroll you with my 300-500 share line? Get some friggin’ perspective, dude! I’ve given other investors and traders plenty of advice on stocks I’ve traded in the past. I never seriously worried anyone on these boards was going to take that info and screw me out of any money. If you’re worried about that, you are truly paranoid. I’m not asking for any insider information, or anything like that, for Christ’s sake!

You ever thought about trading currency? Same fundamentals, just no nosy SEC to deal with, go short go long. go both. Theres tons of sites online. lemme know if your interested. I’ll tell ya who I use

For most people–90% or greater–day trading is a sure way to deminish ones capital. It requires skill, intelligence, nerves, and perserverence that most people do not possess. For the remaining 10%, there is a lot of money to be made.

Which group do you think you might be in?

I have done this a short time and have had some nice successes (doubled my IRA) and some losses. What is the best way to get this info? And, what is a good stock screener to let me know what companies to start looking at?

It doesn’t really matter. Day trading is gambling and as all gamblers know, if you play long enough the house always wins.

Try investing instead. A wise man once said, "It’s very difficult to get rich quick but very easy to get rich slow."

I have lost about 30K daytrading. I don’t even know what line in the tax form I would put the claim since there are hundreds of stocks I bought and sold on the Canadian stock exchange.

Short Answer – No. Capital losses can only be applied against capital gains.

Long Answer – Maybe. If you choose to treat your trading activities as business activities as opposed to capital, then the losses can be applied against all other forms of income, including employment. The appropriateness of treating your trading activities as business rather than capital would depend on a number of factors such as your original intention when buying the shares, the volume of transactions and time spent trading, among others.

The downside of going with business vs capital is that if you incur a profit, then this will be taxed at the full rate, whereas capital gains are taxed at 50% of the normal rate.

Also, once you have decided how to treat your securities trading activities, then you must be consistent in future years.

If you decide to go with business income, then you will need to complete form T2124E – Statement of Business Activities. If you go with capital gains treatment, then you would complete Schedule 3 – Capital Gains or Losses.

Either way, you only recognize gains and losses when the stock is sold. So you can’t recognize a loss from a decline in market value if you still own the stock at year end.

The issue of business income versus capital gains is discussed in the Canada Revenue Agency Interpretation Bulletin 459R (linked below).

I have a Scotttrade account and was considering investing about $20-30K in one or two stocks at any one time. I might be able to stay out of daytrading status.

…But I was wondering if selling a stock on average every 3-4 days at a stock price increase of around 10%, if it is an acceptible profit?

All that would be lost is the $7 trade fee, and maybe 30-40% for taxes. That would leave about $1200 in profit for 3-4 days investing right? or is this way to simple in theory?
hmmm 10% is just a figure i threw out. What would be an acceptable rate?

On average, the S&P 500 index has been up 0.1788% over 4 trading days between 1993 and today. That means over the past 13 years, you’d have had an average increase of about $36 in the 4-day period on a $20,000 investment. Doesn’t leave much after round-trip commissions.

You best 4-day return would have been 13.6% and your worst 4-day return would have been -12.3%.

So, unless your stock-picking abilities are remarkable, I’d say yes, the theory is far too simple.