So if you dont trade on margin, you still have to have a margin
account with 25000? The more im learning and reading the more I
understand why certain people believe there needs to be more
regulation. The crazy amount of risk, aside from just putting your
money up, margin, short sale, etc. I dont have any interest in doing
much of that, in regular life I try to be a cash guy (though economy
and paycheck doesnt allow that) but I wouldnt ever consider taking a
load out to go to the casino.
I see the risk aversion, I switched my paper account balance to the
actual amount id be willing to risk, and suddenly I wasnt as
adventuresome, I assume that would amplify when actual money goes in.
I dont mind my risk on the limited long term stocks, I think theyll
perform well, Smith and Wesson in particular.
I have my paper account sitting at -1900 for the day with pending
sells for tomorrow that I think will hit the expectations at 9
tomorrow. Is that considered day trading since part of the cash was
from a purchase and sell today?
this webull place says i can day trade with 100 dollars, so if i was
to toy with that, its just math to extrapolate to real gains or
losses? Im just finding it hard to believe theres a way to get better
than casino winnings without committing a crime
On Mon, Apr 12, 2021 at 2:55 PM Tyson Burris <[email protected]
<mailto:[email protected]>> wrote:
Steve-
I didn’t read the whole email chain so I maybe blowing smoke here.
Margin is borrowed money based on a set value of a security. You
cannot Margin trade most penny stocks.
Margin trading is high risk / high reward. You MUST be careful.
A stock that is traded on Margin and rapidly decreases its value
you can cause you to be in Margin CALL or even owe the broker if
not careful. Buying Power tends to be Margin.
According to SEC regulations, a day trader is one who trades /
flips five or more times in a trading period. If you are flagged
as a day trader you must maintain 25K or more. Holding a security
overnight and not bouncing in and out of it prevents this from
happening. I believe if your account is flagged, you can wait
60-90 days and request the flag be removed. (assuming you don’t
day trade anymore)
Those who don’t hold a stock for a year or longer will pay a much,
much larger capital gains tax then those who do. Short vs. Long
term.
Examples of pros and cons…
I took a 30K+ loss many years ago when earnings came out and the
stock tanked. I had the stock purchased on Margin. Had I not,
the loss would have been so much less. I was forced into a Margin
call and had to take the large LOSS. This is an example of Margin
trading that caused a large loss.
During Covid, I invested with Margin into a stock I knew would do
well. At the peak, 3 million was made. So this became a perfect
case in which Margin trading worked really to my benefit. I had
to hold this stock for a year or longer to reduce the capital gain
tax.
*Tyson Burris, President**
**Internet Communications Inc.**
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*From:* AF <[email protected]
<mailto:[email protected]>> *On Behalf Of * Steve Jones
*Sent:* Monday, April 12, 2021 1:02 PM
*To:* AnimalFarm Microwave Users Group <[email protected]
<mailto:[email protected]>>
*Subject:* Re: [AFMUG] OT: penny stocks
I just dont get it
I reset my account to specific cash amount. I dont understand
buying power, seems like credit.
The one im toying with is RGBP, if someone can look and tell me
what thinkorswim is letting me do that the real world wouldnt allow
On Mon, Apr 12, 2021 at 11:47 AM Carl Peterson
<[email protected] <mailto:[email protected]>>
wrote:
It is also pretty easy to look like a genius when markets are
going up an idiot on the way down. Markets have been going up
and up and up for a long long time now. At some point that
party will end.
On Mon, Apr 12, 2021 at 11:44 AM Carl Peterson
<[email protected]
<mailto:[email protected]>> wrote:
What is often missing from play accounts is often
liquidity. They generally assume you can make any trade
at wherever the current "price" is. If you are trading
VWAPY that might generally be true. Perhaps not for
VWAGY. Often not when trending $rando penny stock.
On Mon, Apr 12, 2021 at 11:12 AM Steve Jones
<[email protected]
<mailto:[email protected]>> wrote:
im simply not grasping this
on the paper trading site, ive made 7500 this morning
on 10k i was playing with. thats 11,000 dollars in 2
days of playing around with essentially 10,000 up
front. There has to be more to this.
i see on my schwab account if i make more than 4 same
day trades in a week i get flagged as a day trader and
need to have 25,000 in my account or i get a margin
call. I dont know what that means, im not buying on
margin, it would be cash.
assuming that I had actually had 10,000 in my real
account, would I really have profited 11,000 in 2 days
on 5 trades? (there was some math mistakes made, I
made the same size purchase each time, forgetting that
the increased price lowered the number of stocks i
could get for 10k, but technically the sale would have
put enough in to cover the difference)
On Sat, Apr 10, 2021 at 4:08 PM Caleb Knauer
<[email protected]
<mailto:[email protected]>> wrote:
It works great, right until it doesn't. If it was
that easy then we'd
all be wolf of wallstreet.
On Fri, Apr 9, 2021 at 10:13 PM Steve Jones
<[email protected]
<mailto:[email protected]>> wrote:
>
> So I've been dicking around with the market,
trivial amount, 5 shares per stock. If I had put a
lot in Tesco would have done me well.
>
> I have 100 shares of this penny stock, it's a
gold backed cryptocurrency, I watch it bounce a
lot throug the day and its followed the same trend
for its couple months existence.
>
> So I set up a paper account and was dicking
today with another penny stock. Set buy and sell
limits with about 10,000 in the play money. It
made 4k in 2 rounds. It's just a couple pennies it
fluctuates but at 500,000 shares that adds up.
>
> I told the wife and of course she wants me to
cash in something and play with real money.
>
> I'm more inclined to see how the play money
performs, I have some limits on the crypto stock
that we will see what happens on monday morning.
>
> I'm thinking to myself there has to be a catch.
If it was that simple, everybody would be doing it.
>
> You guys who mess around probably went through a
time where you tried that kind of trading, and
none of you talk about it now, so I assume the
catch is pretty straight forward.
>
> I was looking at my IRA, it's done pretty good
at 17 percent. But just taking 10k of it and
playing with this at 1 percent per trading day,
that would be another 27k annually.
>
> I do see why day traders need low latency
though, but with limits I dont see it has a lot of
impact.
>
> What's to stop a guy from spending an hour or 2
every morning with a relatively small amount in
the big scheme of things like 10k trading to 1
percent or better and then going to work? 100
bucks a day or more doesnt seem terrible for an hour.
>
>
> --
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