Hey Hester.
I'm in a similar situation and probably similar mindset so I'll try to contribute from my experience.
I'm 22 in college, have 5 houses (dad passed away; I rent four, live in one), similar amount liquid but I trade with around $30k (just above PDT limit, which is dumb because if I drop under $25k I have to deposit more, but it's smart so that I can't take excessive risk and do real stupid stuff).
I don't know you, but if you're anything like me, the first thing to think about is the easy lifestyle. Trade in the morning, take lunch whenever you want, see a girl or two in the evening, hit the casino on Friday night with the boys, take out the main chick Saturday night, back to trading. Man, that would be the life.
When I first deposited $30k in my IB account I was like "oh shit, I'm gonna be rich".....Yeah right. My first trades were real stupid shit, like all-in margin RIMM longs/shorts for 2-minute time frames, rofl. I still remember myself saying "come on motherfucker!" yelling at RIMM candlesticks on the chart.
I know I know I know, you aren't going to be 'that n00b trader', but I'm telling you, at our age, when you see those dollar signs, you will do dumb shit like that. The thing about this game is that there are no barriers to entry and no 'real' barriers protecting you from risky positions except for yourself, and at 18-22 we're invincible, until you see your P/L moving against you and it's like 'what the fuck bro.'
But back to the houses, I would say rent them, but the situation doesn't sound that easy. The four other houses are within a 10 minute drive of my house so I can handle them.
But, say, the 1800 mile away house....no way bro. If you HAD to rent it, you would be best off with a property management company, which will charge you a small % of the monthly rent payment. But the real problem comes in when there needs to be repairs, like A/Cs (I had to replace 3 old AC units this year), plumbing, electric, people want a new fridge, the stupid ceiling fan sways too much, etc.
Getting a phone call from tenants about repairs is enough of a hassle, but mine are only 10 minutes away. But 1800 miles away? That means you gotta trust the property manager to find the repair guy, and handle the payment and all that garbage. Then of course you still gotta pay property taxes every year and homeowners insurance. Bro, I would try to sell that one. That way your thoughts literally stay close to home, and not something like "I wonder how Mr. and Mrs. Smith are doing with the house?"
The one that is close and in a large lot but is unlivable....boy do I have stories. ALL of my houses were unlivable, except the one I live in lol. I spent 2-semesters and over $50k on remodeling. It's a lot of fun working with contractors (especially Mexican guys, those guys know their stuff and work hard), you know, getting new tile, drywall, paint, fences, appliances, but it is time consuming and a lot of dough. At least you can claim it on your taxes.
If it is in a really good neighborhood and close to where you live, I would consider doing a remodel and renting it for the time being. Get some estimates from contractor guys in the phone book/mail flyer/people you know. Nothing like rent income bro, it's easy. It's a heck of a lot easier income than trading. With renting, you know your position, 'x = make sure the house is in a livable condition for the tenant, y= tenant pays me rent'. Real simple.
I wanted to sell. My dad passed away in 2005 (month before I turned 18) and I sat around for a 2 years not knowing what to do. Looking back, selling at the height of the market probably would have been a wise choice. Hell, everybody thinks that as a monday morning quarterback. But this market is whack, and I don't know what type of value you can get for that house. Is it debt free? Make sure your relative didn't take out a Home Equity Loan or any of those shenanigans.
Now that I rent though, the income is great. I get a couple grand every month from 4 houses. At this rate I might start my own REIT one day along with trading and shit.
Back to trading......man. There's so much to learn bro. I'd say at first, put the money in some very conservative positions that are a small percentage of your total account.
If I was a real new trader at 18 right now, the first thing I would look at are the big movers, i.e. FAS/FAZ/SKF/USO, all the big moving ETFs. That's where the big money is, and being 18 and starting to trade is all about big money. STAY AWAY FROM THEM. In fact stay away from all Financials at this point, honestly. BAC/C/GS/JPM. Those things can gap and your position is gone man. You might look back a couple years from now and say, "bro If i just put a couple grand in that position I'd be up so much right now", but at the same time, if they gap the other way, you won't even have enough money to be trading a couple years from now.
If going the options route (which takes a lot of reading and understanding) do spread trades, nothing where you have unlimited risk. But first you gotta read a lot, books, ET (yes you can learn shit from here, read the Journals, Options, Psychology), heck I even read Yahoo message boards, they are a real circus, but you do get some small insight from the few real posters.
If you are investing and not trading, that's a good way to go. Just make sure you have protection (buy puts on long stock or whathaveyou) so that you can rest easy when you are not looking at your monitor.
The few times I put on overnight unlimited risk positions (i.e. just long calls) and the underlying moved against me in Afterhours, bro, doodoo in my pants. You can't even sleep cause you are dreading opening up IB TWS in the morning and seeing your P/L. SO DEFINITELY PUT ON PROTECTED POSITIONS. I don't really daytrade anymore, but 'tight-stops' seems to be the mantra, if you are going the daytrade route.
I apologize if this thread sounds like a ramble but I spent the last 2 years of my life doing what you are about to begin, and all the memories (not in a gay emotional way, just remembering all the shit I did) are coming back to me, so my thoughts are all over. Hopefully you'll find something of value.
In conclusion
1) Rent income is easy money if you can rent them easy (duh?) Try selling the house 1800 miles away, that is too far man! Evaluate your options on the nearer house!! Rent the apartment.
2) Trading is hard money. Learn first. Oh, I forgot to say, PAPER TRADE. Interactive Brokers paper trade account is as real as it gets, practice with that first!!
3) Hopefully one day you will be able to live that investor/trader lifestyle all us young guys dream about. Drinking a Heineken around 11pm, watching Sportscenter, fine girl resting by your side after you just put it on her, dog is outside sleeping, Aston Martin (or luxury brand of your choice) in the driveway, earlier in the day your position moved in your direction for another $2-3k, futures look good, next day you're gonna watch the game with your boys, gotta call two or three girls back that have been trying to get your attention, you know the deal.
It really is the dream man (at least my dream....though it sounds like I'm more about girls than trading lol), next to being a rockstar/pro ball player. Hopefully I'll be at that point one day, and you as well my man! Best of luck to you Hester!!
Oh, one thing I'll add, limit your daily expenditures. At first I used to buy shit all the time thinking the money will always be there, and then the first time my bank account dropped to less than $100k, I thought "oh shit I spent that much!?!?!". Now I got girls to pay for me when I goto movies and shit, lol. Of course I pay when we go to dinner though, that's just a guy thing to do, I think. But yeah, eat cheap, dress good but not too expensive, don't spend too much on chicks. If you're gonna spend on a chick, she's gotta be real bad!!!! A model chick that shows you her latest work in magazines and shit (I got one of those on my roster right now, but she's got so many dudes chasin her, competition is deep) Only spend on the type of chick that turns heads, don't spend dough on a regular chick bro, you can get that easier, just invite her over to watch a movie or something. Unless she's like your high school sweetheart, then I can understand spending.
Alright I'm typing too much shit now, live your life Hester!!!
I'm in a similar situation and probably similar mindset so I'll try to contribute from my experience.
I'm 22 in college, have 5 houses (dad passed away; I rent four, live in one), similar amount liquid but I trade with around $30k (just above PDT limit, which is dumb because if I drop under $25k I have to deposit more, but it's smart so that I can't take excessive risk and do real stupid stuff).
I don't know you, but if you're anything like me, the first thing to think about is the easy lifestyle. Trade in the morning, take lunch whenever you want, see a girl or two in the evening, hit the casino on Friday night with the boys, take out the main chick Saturday night, back to trading. Man, that would be the life.
When I first deposited $30k in my IB account I was like "oh shit, I'm gonna be rich".....Yeah right. My first trades were real stupid shit, like all-in margin RIMM longs/shorts for 2-minute time frames, rofl. I still remember myself saying "come on motherfucker!" yelling at RIMM candlesticks on the chart.
I know I know I know, you aren't going to be 'that n00b trader', but I'm telling you, at our age, when you see those dollar signs, you will do dumb shit like that. The thing about this game is that there are no barriers to entry and no 'real' barriers protecting you from risky positions except for yourself, and at 18-22 we're invincible, until you see your P/L moving against you and it's like 'what the fuck bro.'
But back to the houses, I would say rent them, but the situation doesn't sound that easy. The four other houses are within a 10 minute drive of my house so I can handle them.
But, say, the 1800 mile away house....no way bro. If you HAD to rent it, you would be best off with a property management company, which will charge you a small % of the monthly rent payment. But the real problem comes in when there needs to be repairs, like A/Cs (I had to replace 3 old AC units this year), plumbing, electric, people want a new fridge, the stupid ceiling fan sways too much, etc.
Getting a phone call from tenants about repairs is enough of a hassle, but mine are only 10 minutes away. But 1800 miles away? That means you gotta trust the property manager to find the repair guy, and handle the payment and all that garbage. Then of course you still gotta pay property taxes every year and homeowners insurance. Bro, I would try to sell that one. That way your thoughts literally stay close to home, and not something like "I wonder how Mr. and Mrs. Smith are doing with the house?"
The one that is close and in a large lot but is unlivable....boy do I have stories. ALL of my houses were unlivable, except the one I live in lol. I spent 2-semesters and over $50k on remodeling. It's a lot of fun working with contractors (especially Mexican guys, those guys know their stuff and work hard), you know, getting new tile, drywall, paint, fences, appliances, but it is time consuming and a lot of dough. At least you can claim it on your taxes.
If it is in a really good neighborhood and close to where you live, I would consider doing a remodel and renting it for the time being. Get some estimates from contractor guys in the phone book/mail flyer/people you know. Nothing like rent income bro, it's easy. It's a heck of a lot easier income than trading. With renting, you know your position, 'x = make sure the house is in a livable condition for the tenant, y= tenant pays me rent'. Real simple.
I wanted to sell. My dad passed away in 2005 (month before I turned 18) and I sat around for a 2 years not knowing what to do. Looking back, selling at the height of the market probably would have been a wise choice. Hell, everybody thinks that as a monday morning quarterback. But this market is whack, and I don't know what type of value you can get for that house. Is it debt free? Make sure your relative didn't take out a Home Equity Loan or any of those shenanigans.
Now that I rent though, the income is great. I get a couple grand every month from 4 houses. At this rate I might start my own REIT one day along with trading and shit.
Back to trading......man. There's so much to learn bro. I'd say at first, put the money in some very conservative positions that are a small percentage of your total account.
If I was a real new trader at 18 right now, the first thing I would look at are the big movers, i.e. FAS/FAZ/SKF/USO, all the big moving ETFs. That's where the big money is, and being 18 and starting to trade is all about big money. STAY AWAY FROM THEM. In fact stay away from all Financials at this point, honestly. BAC/C/GS/JPM. Those things can gap and your position is gone man. You might look back a couple years from now and say, "bro If i just put a couple grand in that position I'd be up so much right now", but at the same time, if they gap the other way, you won't even have enough money to be trading a couple years from now.
If going the options route (which takes a lot of reading and understanding) do spread trades, nothing where you have unlimited risk. But first you gotta read a lot, books, ET (yes you can learn shit from here, read the Journals, Options, Psychology), heck I even read Yahoo message boards, they are a real circus, but you do get some small insight from the few real posters.
If you are investing and not trading, that's a good way to go. Just make sure you have protection (buy puts on long stock or whathaveyou) so that you can rest easy when you are not looking at your monitor.
The few times I put on overnight unlimited risk positions (i.e. just long calls) and the underlying moved against me in Afterhours, bro, doodoo in my pants. You can't even sleep cause you are dreading opening up IB TWS in the morning and seeing your P/L. SO DEFINITELY PUT ON PROTECTED POSITIONS. I don't really daytrade anymore, but 'tight-stops' seems to be the mantra, if you are going the daytrade route.
I apologize if this thread sounds like a ramble but I spent the last 2 years of my life doing what you are about to begin, and all the memories (not in a gay emotional way, just remembering all the shit I did) are coming back to me, so my thoughts are all over. Hopefully you'll find something of value.
In conclusion
1) Rent income is easy money if you can rent them easy (duh?) Try selling the house 1800 miles away, that is too far man! Evaluate your options on the nearer house!! Rent the apartment.
2) Trading is hard money. Learn first. Oh, I forgot to say, PAPER TRADE. Interactive Brokers paper trade account is as real as it gets, practice with that first!!
3) Hopefully one day you will be able to live that investor/trader lifestyle all us young guys dream about. Drinking a Heineken around 11pm, watching Sportscenter, fine girl resting by your side after you just put it on her, dog is outside sleeping, Aston Martin (or luxury brand of your choice) in the driveway, earlier in the day your position moved in your direction for another $2-3k, futures look good, next day you're gonna watch the game with your boys, gotta call two or three girls back that have been trying to get your attention, you know the deal.
It really is the dream man (at least my dream....though it sounds like I'm more about girls than trading lol), next to being a rockstar/pro ball player. Hopefully I'll be at that point one day, and you as well my man! Best of luck to you Hester!!
Oh, one thing I'll add, limit your daily expenditures. At first I used to buy shit all the time thinking the money will always be there, and then the first time my bank account dropped to less than $100k, I thought "oh shit I spent that much!?!?!". Now I got girls to pay for me when I goto movies and shit, lol. Of course I pay when we go to dinner though, that's just a guy thing to do, I think. But yeah, eat cheap, dress good but not too expensive, don't spend too much on chicks. If you're gonna spend on a chick, she's gotta be real bad!!!! A model chick that shows you her latest work in magazines and shit (I got one of those on my roster right now, but she's got so many dudes chasin her, competition is deep) Only spend on the type of chick that turns heads, don't spend dough on a regular chick bro, you can get that easier, just invite her over to watch a movie or something. Unless she's like your high school sweetheart, then I can understand spending.
Alright I'm typing too much shit now, live your life Hester!!!
