This sets up an interesting challenge. I left out the time frame i would like to get this done. If i say a year, it greatly influences what kinds of decisions need to be made compared to getting it done in ten years. I'm going to propose a one year program from the time i actually start moving the $100 around the market(s). The first few challenges have to do with:
A.) Where can i open an account for $100.
B.) How to overcome the handicaps unique to trading $100 or less.
Because the commissions and spread are bound to be relatively high compared to dealing with, say, $1000 stock/option trades, probably this will dicate how long i ought to be holding. Daytrading is ruled out, unless it's possible to day-trade options. Even then, it would not make sense to concern myself with daytrading options unless options with at least six weeks of time can regularily move enough to overcome spread/commision handicaps. More likely, $100 start up cap (and a one year goal) dicates a swing trading approach with holding periods of three to six days. This bears on what kind of strategy i use, and what kind of data i will need to test and verify whatever strategy that will be. A $100 start up seems to dictate that i start with:
a.) stocks and/or stock options.
b.) forex
c.) stock index options
d.) free data for testing
e.) free software for testing some set ups.
Look at d.) and e.)
I believe i can solve the problem of e.) with Tradelink. It may require me to learn some C# in addition to the VB i already know. I'm also pretty sure i can get my hands on some free data if i'm willing to settle for 1 minute bars instead of tick data. If that's not easy, i will need to get daily bars and develop initials strategies around those.
Look at c.)
Stock index (futures) options would potentially work if there was a broker that allowed it...and a $100 initial deposit. This is preferable assuming spread and commisions are not a greater handicap than if i were dealing with stocks and stock options and corresponding broker.
Look at b.)
I'm fairly certain it's possible to find a forex broker who will open an account for $100. And the leverage, if desired, could be comparable to options. But can i overcome a potentially significant pip spread (or other commission structure)?
Look at a.)
Pretty sure i can get a stock option account open for $100. Before i did this, i will want to have an idea of what kind of handicap this represents compared to the other options listed above. Overcoming it may have to do with what kinds of research tools such a broker might offer. If it were possible to obtain a lot of data on some liquid stocks, it might help.
In order to get started sooner than later, i might consider invoking a coattailing venture. This strategy is simply to identify successful traders and copy their moves in and out of whatever market they deal with best. This is a strategy i have yet to research fully, but seems possible. It oftentimes costs money to coattail, for example, to join a daytrading room for $100 a month. On the other hand, it may be possible to coattail for less, say, for $20 a month or less.
I have yet to make a decision between coattailing and verifying my own strats using my own programming abilities. Long-term i want to catch my own fish rather than be given a fish. I'm thinking, what is my time worth? How long will it take me to verify strats that are better than the strats of whomever i coattail? If i coattail successfully, i will have more capital to put into my own strats whenever they are ready to roll out. Hmmm...
Ok, that's good enough to get this journal off the ground. It's about the unique challenges of starting with not much capital and working in a generally aggressive, assertive, open-minded fashion. It's not my intent to take a $100 account less seriously than a $1k or $10k. It would be easy to blow it up ten times and start over. that would be equivalant to starting with a $1K account. But then, that defeats the purpose of this thread. It's not about taking $200 to $2K much less $1K to $10K. On the other hand, a one year framework does dictate generally more aggressive policies.
A.) Where can i open an account for $100.
B.) How to overcome the handicaps unique to trading $100 or less.
Because the commissions and spread are bound to be relatively high compared to dealing with, say, $1000 stock/option trades, probably this will dicate how long i ought to be holding. Daytrading is ruled out, unless it's possible to day-trade options. Even then, it would not make sense to concern myself with daytrading options unless options with at least six weeks of time can regularily move enough to overcome spread/commision handicaps. More likely, $100 start up cap (and a one year goal) dicates a swing trading approach with holding periods of three to six days. This bears on what kind of strategy i use, and what kind of data i will need to test and verify whatever strategy that will be. A $100 start up seems to dictate that i start with:
a.) stocks and/or stock options.
b.) forex
c.) stock index options
d.) free data for testing
e.) free software for testing some set ups.
Look at d.) and e.)
I believe i can solve the problem of e.) with Tradelink. It may require me to learn some C# in addition to the VB i already know. I'm also pretty sure i can get my hands on some free data if i'm willing to settle for 1 minute bars instead of tick data. If that's not easy, i will need to get daily bars and develop initials strategies around those.
Look at c.)
Stock index (futures) options would potentially work if there was a broker that allowed it...and a $100 initial deposit. This is preferable assuming spread and commisions are not a greater handicap than if i were dealing with stocks and stock options and corresponding broker.
Look at b.)
I'm fairly certain it's possible to find a forex broker who will open an account for $100. And the leverage, if desired, could be comparable to options. But can i overcome a potentially significant pip spread (or other commission structure)?
Look at a.)
Pretty sure i can get a stock option account open for $100. Before i did this, i will want to have an idea of what kind of handicap this represents compared to the other options listed above. Overcoming it may have to do with what kinds of research tools such a broker might offer. If it were possible to obtain a lot of data on some liquid stocks, it might help.
In order to get started sooner than later, i might consider invoking a coattailing venture. This strategy is simply to identify successful traders and copy their moves in and out of whatever market they deal with best. This is a strategy i have yet to research fully, but seems possible. It oftentimes costs money to coattail, for example, to join a daytrading room for $100 a month. On the other hand, it may be possible to coattail for less, say, for $20 a month or less.
I have yet to make a decision between coattailing and verifying my own strats using my own programming abilities. Long-term i want to catch my own fish rather than be given a fish. I'm thinking, what is my time worth? How long will it take me to verify strats that are better than the strats of whomever i coattail? If i coattail successfully, i will have more capital to put into my own strats whenever they are ready to roll out. Hmmm...
Ok, that's good enough to get this journal off the ground. It's about the unique challenges of starting with not much capital and working in a generally aggressive, assertive, open-minded fashion. It's not my intent to take a $100 account less seriously than a $1k or $10k. It would be easy to blow it up ten times and start over. that would be equivalant to starting with a $1K account. But then, that defeats the purpose of this thread. It's not about taking $200 to $2K much less $1K to $10K. On the other hand, a one year framework does dictate generally more aggressive policies.
