Some starting ideas? Help Please

[Prainluda]

Ok heres what im wondering.

#1 if I were to invest around 3 grand does anyone think thats worth while? Im not the richest person in the world but I would like to get into the market.

#2 Clearly I would not be buying Apple or Google stocks 🙁 but stocks on the lower end of the scale.

#3 I invested around a thousand dollars once and came out with a few hundred dollars after commissions. So I imagine it can be more difficult starting on the lower end but it can still work.

#4 im not interested in any other kind of investing. I want to be in the market. ALSO I think I would be in the category of a swing trader. However I don't think I would ever sell short. There are some stocks ive followed alot and know their patterns. So when the down swings or up swings come I know when to Jump in and Jump out.

Just wondering if anyone else has started with a lower amount compared to some people who can put up ALOT of money into the market??

OOO 1 final question. Theres a stock I know that trades at .16 cents average for like a year. The high is like .20 the low is like .10 MY question is if I buy it at .155 and want to sell at .17 is it hard to sell if you own ALOT of shares??? Unless the stock has alot of volume but if its a low volume stock and nobody wants to buy the shares then im stuck with it right??? Just wondering

Thanks everyone I look forward to your advice and input!!

 

[davidh1819]

Ok heres what im wondering.

#1 if I were to invest around 3 grand does anyone think thats worth while? Im not the richest person in the world but I would like to get into the market.

#2 Clearly I would not be buying Apple or Google stocks 🙁 but stocks on the lower end of the scale.

#3 I invested around a thousand dollars once and came out with a few hundred dollars after commissions. So I imagine it can be more difficult starting on the lower end but it can still work.

#4 im not interested in any other kind of investing. I want to be in the market. ALSO I think I would be in the category of a swing trader. However I don't think I would ever sell short. There are some stocks ive followed alot and know their patterns. So when the down swings or up swings come I know when to Jump in and Jump out.

Just wondering if anyone else has started with a lower amount compared to some people who can put up ALOT of money into the market??

OOO 1 final question. Theres a stock I know that trades at .16 cents average for like a year. The high is like .20 the low is like .10 MY question is if I buy it at .155 and want to sell at .17 is it hard to sell if you own ALOT of shares??? Unless the stock has alot of volume but if its a low volume stock and nobody wants to buy the shares then im stuck with it right??? Just wondering

Thanks everyone I look forward to your advice and input!!

Not at all you have to start somewhere anyone with £100 in their pocket can start trading SBs or CFDs thanks to the leverage given to investors. my first deposit was £4000

 

[Prainluda]

Not at all you have to start somewhere anyone with £100 in their pocket can start trading SBs or CFDs thanks to the leverage given to investors. my first deposit was £4000

So when you started with 4,000 what kind of investing did you start with? In the stock market and if so what were the price range that you wanted on a stock?

I think the roof on $3000 would be $10 max for a stock or around there.

300 shares if the price goes up .20cents = $60 which pays commissions. Seems more difficult then lower end stocks.

On lower end for a dollar I could get 3000 shares. If they go up .10 cents thats $300 a little better I think

 

[davidh1819]

So when you started with 4,000 what kind of investing did you start with? In the stock market and if so what were the price range that you wanted on a stock?

I think the roof on $3000 would be $10 max for a stock or around there.

300 shares if the price goes up .20cents = $60 which pays commissions. Seems more difficult then lower end stocks.

On lower end for a dollar I could get 3000 shares. If they go up .10 cents thats $300 a little better I think

I trade the Forex Markets via contract for diffrence i use indicators to predict price movements on a 6 month timeframe i risk 2% of my account and attempt to make eather a 4% or 6% gain per trade. I dont realy do stocks FX is my area.

 

[eegozi]

So when you started with 4,000 what kind of investing did you start with? In the stock market and if so what were the price range that you wanted on a stock?

I think the roof on $3000 would be $10 max for a stock or around there.

300 shares if the price goes up .20cents = $60 which pays commissions. Seems more difficult then lower end stocks.

On lower end for a dollar I could get 3000 shares. If they go up .10 cents thats $300 a little better I think

WOW,...I am not trying to be an a**hole,...but you really dont know what you are doing and will likely lose most if not all of that money quickly with that plan. I know because I tried that. Looking back now I see it was a very naive way to trade.

With that plan you will risk too much per trade and be in highly volatile stocks that are thinnly traded. You will lose BIG the day that some stupid earnings report or bit of news comes out against you and NO ONE wants to buy.

You really do NOT need to worry about the price of a stock in most cases to trade correctly. If you have chosen a stop loss and an amount you want to risk then you can figure out the number of shares to buy and ALWAYS keep your capital at risk the same. It basically varies based on the stocks volatility. For instance on a $10 stock with stop loss set at $9 I may risk lets say 1% of my capital on this trade. Lets assume each trade costs $7 to buy and $7 to sell ($14 roundtrip commision). If I have $25,000 (1% = $250). I can Buy 236 shares of this stock and risk only $250 (1% = $250 - $14 ROUNDTRIP commision = $236 to risk on the stock). Now do this with $5000 account (1%= $50 - $14 ROUNDTRIP commision = $36 dollars or 36 shares with a $1 stop loss) You are basically eating up 0.28% of your portfolio on every single trade you make with that small an acct size. Do the numbers,....you will see it is poor money management ESPECIALLY if you are swing trading with about 1-5 trades a day. Even if you do ONLY 10 trades a month that is 10*0.28% = 2.8% PER MONTH in commisions.....factored over 1 year.....2.8% * 12 = 33.6%....WOW!!!!!.....I am confident in my abilities but are you confident enough to BEAT the market by 33.6% every year before you even make ONE PENNY?😢

I suggest you read Dr. Alexander Elder's books and Dr. Van Tharp's books as a good starting point and paper trade until you have mastered some things. I suspect you are quite young and should not be afraid of missing the opportunity that passes you by while you do this education. Meanwhile save your pennies and build a bigger starting account to trade with. I suggest an absolute minimum of $10,000 and even then that is quite LOW. $25,000 would be better. Anything smaller than that and commisions and slippage will eat you alive. Good Luck.

 

[Prainluda]

Thanks for the reply eegozi

When I say I want to be a swing trader its not everyday at all. Its like if I buy a stock at .70cents and it goes up to $1 in 3 weeks. Then I sell off. If the stock drops to like .50 cents I need to do my homework but at the same time to buy back in.

First stock I ever owned was bought for .78 cents and I had over 1 thousand shares. To break even I did need the stock to climb 6 cents however my ultimate goal was to hold the stock for a long time. Then it had some nice up swings so I sold off and made a few hundred dollars. The good thing about that stock was it was a company just starting and it had alot of assets and progress.

I can understand what your saying. If something goes wrong with the company my investment goes down the drain.

*****Heres a question that im wondering and would like someone to help me with.******

Theres a stock that stays pretty much even over the last year it averages .20 cents pretty much the whole year. Now sometimes it goes under that by abit and other times it goes over. IF I were to pick up the stock at lets say .19 cents and once it reaches .21 cents sell it off for a profit does that work? OR because its such a small stock no one would be buying the sell off?? Is that how it works if I want to sell a stock for .21 cents it needs someone to come along and buy it?

 

[eegozi]

Thanks for the reply eegozi

When I say I want to be a swing trader its not everyday at all. Its like if I buy a stock at .70cents and it goes up to $1 in 3 weeks. Then I sell off. If the stock drops to like .50 cents I need to do my homework but at the same time to buy back in.

First stock I ever owned was bought for .78 cents and I had over 1 thousand shares. To break even I did need the stock to climb 6 cents however my ultimate goal was to hold the stock for a long time. Then it had some nice up swings so I sold off and made a few hundred dollars. The good thing about that stock was it was a company just starting and it had alot of assets and progress.

I can understand what your saying. If something goes wrong with the company my investment goes down the drain.

*****Heres a question that im wondering and would like someone to help me with.******

Theres a stock that stays pretty much even over the last year it averages .20 cents pretty much the whole year. Now sometimes it goes under that by abit and other times it goes over. IF I were to pick up the stock at lets say .19 cents and once it reaches .21 cents sell it off for a profit does that work? OR because its such a small stock no one would be buying the sell off?? Is that how it works if I want to sell a stock for .21 cents it needs someone to come along and buy it?

Again,...stay away from penny stocks. You seem hell bent on this idea.....so when you lose your $$$ you will listen. My advice is the same,...paper trade and build a bigger starting fund. Do NOT trade any stocks less than about $9 and with less than a 1,000,000 shares traded a day average as a starting point. This is a good rule to live by. As you improve you will take more risk. Currently I do not trade any stocks that have less than 400,000 shares traded a day and that are less than $6.

Your questions show your naivete...NOT trying to be rude,...just giving words of wisdom.

 

[Prainluda]

Hey I defiantly appreciate everyone's input. AND I do hear what your saying but I can't wrap my head around some of the reasoning.

Example the stock I follow and like

Price: Under A dollar
Average Volume: 600,000 <--- Seems good according to what your saying.

52 week range .45 - 1.27

Now heres why I don't think this is a bad investment if you can get into the .50 .60's

Its a coal company that just finished building 1 of its coal mines and is working on getting permits on its other mine. It runs out of Mongolia and would be shipping to China who clearly needs coal something like 80% of their energy is from coal. Even if China is in a down trend a bit now still 80% is alot.

Once it gets approved for its second mine should be sometime this year still. AS well as their powerplant then I can see the price going up even more.

Of corse I have to watch the news carefully and be cautious like Americas August 2nd.

I just don't see how this can be considered a terrible investment. ABIT risky sure.

But if I were to put lets say 3grand into the stock at .50 cents then if the stock goes up 1 cent commissions are paid for. Now again if im buying at the low and this company continues its progress and swings alot when news comes out. Then it can easily jump .40 cents in a month. Which makes for a nice return.

Now I do understand for every upside there can be downsides. But just with this stock I can't see it dropping lower unless the economy crashes and every stock drops out. Because they have established a mine already and are working on another mine and powerplant. ALSO they own other properties as well.

To me I feel like the company has ALOT more upside then a downside. Which to me it seems that it poses little risk.

Not trying to put off what you say as it does make alot of sense. Im just trying to explain my side so you can fully see why I like the stock that I like.

ALSO im not going to be buying and selling everyday and picking up a few dollars here or there. So for commissions and everything else this seems not all that bad.

But honestly id love to hear your thoughts as well on this.

PS: Sorry by the sounds of what I wrote it sounds like I dont think the stock could drop to like .30 or .20 I do understand it easily could. But from what ive seen that this is a strong company and stock.

 

[eegozi]

Hey I defiantly appreciate everyone's input. AND I do hear what your saying but I can't wrap my head around some of the reasoning.

Example the stock I follow and like

Price: Under A dollar
Average Volume: 600,000 <--- Seems good according to what your saying.

52 week range .45 - 1.27

Now heres why I don't think this is a bad investment if you can get into the .50 .60's

Its a coal company that just finished building 1 of its coal mines and is working on getting permits on its other mine. It runs out of Mongolia and would be shipping to China who clearly needs coal something like 80% of their energy is from coal. Even if China is in a down trend a bit now still 80% is alot.

Once it gets approved for its second mine should be sometime this year still. AS well as their powerplant then I can see the price going up even more.

Of corse I have to watch the news carefully and be cautious like Americas August 2nd.

I just don't see how this can be considered a terrible investment. ABIT risky sure.

But if I were to put lets say 3grand into the stock at .50 cents then if the stock goes up 1 cent commissions are paid for. Now again if im buying at the low and this company continues its progress and swings alot when news comes out. Then it can easily jump .40 cents in a month. Which makes for a nice return.

Now I do understand for every upside there can be downsides. But just with this stock I can't see it dropping lower unless the economy crashes and every stock drops out. Because they have established a mine already and are working on another mine and powerplant. ALSO they own other properties as well.

To me I feel like the company has ALOT more upside then a downside. Which to me it seems that it poses little risk.

Not trying to put off what you say as it does make alot of sense. Im just trying to explain my side so you can fully see why I like the stock that I like.

ALSO im not going to be buying and selling everyday and picking up a few dollars here or there. So for commissions and everything else this seems not all that bad.

But honestly id love to hear your thoughts as well on this.

PS: Sorry by the sounds of what I wrote it sounds like I dont think the stock could drop to like .30 or .20 I do understand it easily could. But from what ive seen that this is a strong company and stock.

If you like it,...go for it. 😆

You are describing reasons to invest not trade. This is largely a fundamental reason. Do you honestly think you know the fundamentals as good or better than the MUCH bigger investors than you who are probably closer to the company an dmaybe even employees? Are you aware that China does NOT import most of its coal? What you plan to do is putt ALL your eggs in one basket. One day that basket will get turned over and then all your eggs will be splattered all over the ground. No matter how pretty they look in your basket they will be worthless when they are on the ground....

TRADING involves minimizing risk and maximizing return. INVESTING involves fundamental analysis to find a stock that is undervalued and estimate its cash flow and intrinsic value. I suspect you have done NONE of this. By the way,...can you even get the financial statements on this company and do a detailed financial anaylsis?,...doubtfull because this stock is in Mongolia. To me this stock is ALL risk and Lotto type return (very hard to judge your chance of a winning trade). I think no matter what I say you are going to do this. SO GO FOR IT!!! When you lose your money you should take your next $20 that you scrape together for investing/trading and buy a book by either Dr. Alexander Elder, Dr. Van K Tharpe, or Benjamin Graham.

One thing you should realize is that people make a living off of this as a PROFESSION!!! Why do you think that your nearly ZERO knowledge of the markets and trading that you can suddenly outperform them? Would you ever practice Brain Surgery without having ever gone to Medical School or Residency training just because you saw a book about the brain and thought it was cool?....NO. So why would you do this trading idea with no education what so ever?. Sorry to be so harsh but you really need some education.
Why dont you do your plan and report back in 1 month... Good Luck.

 

[eegozi]

One more thing,...have you ever even thought how LONG it would take you to liquidate your position should you "INVEST" $3,000 into this stock that trades at about .50/share and ~600,000 shares/day? Do the math....do you really want to be holding onto this stock that long should things go against you? You realize that you will own 1% of the average daily value of shares that is ever traded on this stock (600,000 * 0.5 = $300,000 of stock traded per day). That is alot!!!

 

[Prainluda]

As ive said im learning and appreciate your advice. Even if you seem abit harsh to a newbie 😉

Anyways im not jumping in yet. Also I have researched the authors that you have talked about.

I do have some learning to do.

PLUS sometimes we have to learn what works and what doesn't. For me I learned a few things when I first bought the stock.

#1 dont be greedy in a week I could have made some decent money but I held hoping stock was going up more and it went down.

#2 Patience if the company is decent then it will have high and low swings so sometimes its good to wait for it to come back.

#3 Since I did sell the first time up 20% its hard for me to really change my thinking on this as to why I respond by explaining everything.

HOWEVER im taking in what your saying and will do some studying some more and when I get into the market ill keep everyone updated. Gain or Loss

 

[Caledonianbu]

I'm a Spreadbetting Newbie, I chose spread betting because of the reduced cost of ACTUALLY doing it. No set fees for placing bets - which would eat away at my minuscule starting capital very quickly! I know there is a higher level of risk involved, but there are quite easy ways to minimise this risk.

Just suggesting spread betting might be a better start?