I've got 5K, what now?

From Reminiscences of a Stock Operator

I have heard of people who amuse themselves conducting imaginary operations in the stock market to prove with imaginary dollars how right they are. Sometimes these ghost gamblers make millions. It is very easy to be a plunger that way. It is like the old story of the man who was going to fight a duel the next day.

His second asked him, "Are you a good shot?"

"Well," said the duelist, "I can snap the stem of a wineglass at twenty paces," and he looked modest.

"That's all very well," said the unimpressed second. "But can you snap the stem of the wineglass while the wineglass is pointing a loaded pistol straight at your heart?"






Paper and live trading are a world apart. You will see how psychology plays into this once you start trading live.
 
I think as a general rule it is recommended that you trade one position (or commodity, contract, etc.) for every 10,000 dollars you have.. guess that means you can only trade half a position?

Seriously tho.. if you really think your ready (or just can't wait to lose your 5k) then just trade one position then close it out at a profit or loss and trade another one.. and so on.. report back in a week.
 
Blowing an entire 5k account that you could barely save up for is much more educational than blowing 5k in a 50k account.

You get to feel the anxiety of your existence and gain respect for the market.

I think paper trading only becomes useful after you have alot of experience and you know what the market can do to you. I find that I treat a demo account just as seriously as a live account now. It's a force of habit that I didn't have before I gained live experience.
 
In order to conserve capital try trading live for about one or two months and then go back to sim to fine tune your money management skills and trade executions; while on sim, you should always remind yourself of how you should handle certain situation if you were trading live. Prop shops starting with very little capital is the better way to go IMO.
 
When sim trading have one real money position on at any one time. Simply pick one at random and go with it.. helps ease the psychological barriers instead of being thrown in the deep end right away.
 
SPY May 2010 119.000 put
(OPR: SPY100522P00119000)
Last Trade: 2.65
Trade Time: 4:14PM EDT
Change: Up 1.35 (103.85%)
Prev Close: 1.30
Open: 1.93
Bid: 2.64
Ask: 2.70
Day's Range: 1.92 - 3.23
Contract Range: 0.88 - 10.90
Volume: 26,613
Open Interest: 290,210
Strike: 119.00
Expire Date: 21-May-10
Quotes delayed, except where indic
==========================

wait for right signals and double your money 2-3 times a year -you couldve ambushed this if you saw this

http://www.elitetrader.com/vb/showthread.php?threadid=197622




:D :D :D Easy money-trading isnt that hard, double a few times and thats it
 
Quote from ammo:

it'll be hard not to overtrade going for 50 dollar hits,even a breakeven new trader will go broke on commissions when overtrading,part of your discipline should include number of trades a day
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i wish I knew what this really meant when I started! Over trading is ....I was traidng to cover commisions, thats over trading. HAHA Good Luck seriously. using 5000.00 to test the waters and see how things work is the wrong approach, i think. But how do you know what a plan is or over trading really means until you test the waters to see how things work.
 
Quote from thebullpicker:

I realize I'll probably get some angry comments about a statement that makes me seem like a schmuck who knows nothing about trading but try to keep those to a minimum.

Cliff Notes:
I've been "paper trading" for about six month.
I've been profitable, and feel ready to take the next step.
very dedicated, have been putting in the effort.
I'm a college kid, looking to trade remotely.
I have about 5k that I'm will to risk to see if trading is the future path for me, I strongly believe it is so I am willing to take the risk.


What are my options now? Since I only have around 5k I guess a prop firm would be the best option so that I have enough capital?
Keep in mind I will being trading over the summer and part time during the year so this is by no means me trying to make a living off the earnings at the moment, but rather me looking for the experience, and getting some beer money :p

I know there are tons of firms out there, but how can I locate the decent ones that aren't just taking my money with ridiculous fees.

(the only ones I have talked to are Keystone Trading, Broad Street Capital, and Capital traders Group, but I don't know much about any of them)

any help would be greatly appreciated, thanks guys.
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As long as you realize that your post is pretty much the post of most people starting out, and also realize that 99% of people will wind up failing, and that your $5K will be gone pretty soon, that most of the responders here are also paper traders, then you will understand "what now."
 
Quote from TraderZones:

As long as you realize that your post is pretty much the post of most people starting out, and also realize that 99% of people will wind up failing, and that your $5K will be gone pretty soon, that most of the responders here are also paper traders, then you will understand "what now."
More...

The OP must also understand that TZ is a previously failed trader, who continuously discourages new traders from trying.
 
Well we all know that trading isnot for every one
Only those who risk gong to far will know how far one can go
The OP should realize that the $5K is is planning to trade he might end up loosing all
 
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