Hi guys - in need of your opinions.
I'm thinking about quitting my current job soon and trade full-time. I'm 24, been working for 1.5 years at a finance firm, and make little under 60k per year. Right now I have $9000 and I just took out a loan of $11000 from lendingclub which is going to be deposited into my bank account in less than 4 business days (26% APR). My current plan is trade safe until I get to $30000 then start day-trading. I don't have experience daytrading with real money due to lack of capital but I think I'll be able to make make consistent returns while cutting my losses short.
The reason I think i have a talent in trading is (haha..) my experience from virtual trading. Using $100,000 account with 2x margin ($200,000 buying power) I was able to consistently make at least 2% returns a day while keeping my losses to 1% a day. I participated in virtual stock competitions and finished first places. I developed my own trading style and later found out it was a mix of what people refer to as momentum trading and technical trading.
I've also traded during college and used the profits to pay for rent, phone bills, living expenses, etc. Please note I had about $5000 at the time and I was able to make $1000 (~10% return a month due to leverage) in most months. This was under PDT restrictions. Due to the stupid PDT rule once I went under for a month and because I was paying bills, in the long run I lost money. But every year it's always positive a couple thousand, then slowly sliding down to end the year in the red after that "one month" of negative returns.
I told one friend about my loan and while all he said was "I think that's too risky. Well, you might get lucky but don't do it again", his initial expression was "WTF is he crazy?".
I understand what I'm doing is extremely risky, but I always thought I had a talent for trading and it came off as easy to make at a percent a day. I also never keep my trades overnight. Any thoughts on my stupidity?
Should have asked for people's opinions before taking out my loan, but the dice is thrown...
If you're not financially up from the moment of this post, there might be some base assumptions you've made worth reconsidering.
It's understandable to take calculated risks, to trust oneself, and go for it. However, if you find yourself in a hole, the not so obvious from the hole diggers perspective is to stop digging.
If you have a reliable family/social net, then the cavilier attitude around your capital management makes sense for you to anticipate support. Perhaps you've come from a good background where the scarcity of money didn't effect you?
The approach you are taking even if you were to pull a rabbit out of a hat will ultimately take you back to this edge of risk of ruin. The gambler's mentality is very seductive especially with early success.
The thing that will be different is the amount of responsibilities in your life and the people who will depend on you.
The hard lessons are the one's we create for ourselves - repeatedly. The easy one's are when we learn from others mistakes. One saves A LOT of time and frustration.
This is your path, you alone must live with the consequences of your choices and actions for better of for worse. You alone must tell yourself the truth in a way that you can hear it.
Scars are sexy, but not from someone who likes to play chicken with a bus.
Forgive me if you've addressed these points in previous posts.
With that said, I wish you the best and silently rooting for your success!
