How many times did you lose your capital before becoming profitable?

[SimpleTrades]

@HateTheRisk

Lol! My goals aren't as lofty as 40 million francs. I'll settle for a few million Canadian dollars. The government can take their share in taxes, and I'll live happily ever recovering my skills on my violin, and caring for my wife, and my baby due in July.

But yes, using leverage as a way to control risk is very effective. Consider the $100,000 example again. Assume on any given trade you're willing lose 3%. So, deposit 97,000 in a savings account. Put 3,000 in a trading account and leverage it 33.33 to 1. Buying power is still $100,000, but the most you'll lose is the $3000.

Don't curse your broker's margin calls. Exploit it. Use it to your advantage.

 

[cyoungmark]

Quote from bhardy307:

"real money"? Another SIM trader? I'm sorry, but I simply don't agree. The psycholgy of trading a SIM account and real money is completely different. How much have I lost since this proces began about a year ago? About $1000.

You make a good point about using leverage properly. Your argument about the psychology of trading real money is flawed though. With a $100 you have MUCH less fear with trading even IF it controls a leveraged amount. I guarantee no matter how much you trade this $100 and get comfortable with your strategy, you will still have anxiety trading any substantial amount of money in the future.

 

[sheda]

I guarantee no matter how much you trade this $100 and get comfortable with your strategy, you will still have anxiety trading any substantial amount of money in the future.

Naturaly, but its just another step in the individuals path to be over come...

 

[rtiger29]

Quote from sheda:

Naturaly, but its just another step in the individuals path to be over come...

I agree a 100%. Its another step and that obstacle too will be broken, if you can get to that point, then im sure it will be no issue to knock that wall down.

 

[Bear Trader]

Quote from HATEtheRisk:



once you have 100k you can play slower and make 10-30% a week as goal.

[/B]

lol! 30% a week is slower?

Only on ET do we have the best traders in the world

 

[Bear Trader]

Its all about MM

 

[oldtime]

Quote from Bear Trader:

lol! 30% a week is slower?

Only on ET do we have the best traders in the world

Bear Trader, I'm starting to see the uselessness of percentage performance. For instance, if you have money in the bank and only keep enough in your trading account to cover margin, and then quote your return just on margin, well, no wonder some of these guys routinely make 100% a month.

 

[oldtime]

Quote from bhardy307:

And in one simple sentence you have proven you don't understand how to use margin.

First of all, the sentence wasn't that simple, and secondly I don't think you even know what I am talking about. It has nothing to do with trading or using margin, just simply explains the confusion when traders talk about their performance return.

For instance, if I have a 100k on Jan1 and 120k on Dec31 I call that a 20% return. Makes no difference to me if only 20% is in the tradng account and the rest is in the bank. So when I discuss my return with other traders and we are all on the same page and can compare results.

However, another trader may think of it as starting with 20k and ending with 40k and callint it 100% return. See the difference?

Now I'll shut up and read your posts and maybe I will finally learn how to use margin.

 

[SimpleTrades]

Quote from oldtime:

maybe I will finally learn how to use margin.

Hey Buddy, if you're going to be cheeky as you were in your last post and as you were yesterday, then you deserve cheekyness thrown right back at you.

I actually deleted my comment before you replied realizing that I was being a little too sharp.

Yes, I did understand your point, but this is not what I was saying earlier. $1000 margined 100 to 1 is $100,000 of purchasing power. If I make full use of that margin, and I earn a 10% return, I now have $11,000 in my trading account. 10% of $100,000 is $10,000 + the $1000 I deposited.

The big difference is the downside risk. If my trade suddenly plunges 10%, you are stopped out before you can lose 10% of 100,000. As a result, you only lose the $1000.

 

[d08]

Quote from HATEtheRisk:

once you have 100k you can play slower and make 10-30% a week as goal.

10%-30% a week on 100k constantly?
Why not just say, "make trillions"? It's almost as credible.
Got to love the 2011 registrants who are telling how easy it is.