Starting off daytrading....(advice required)

[PAINTACE]

Undertaker

I noticed you quickly increased your bank from £5k to £10. I think you should start trading with just £5k. If and when you screw up and loose 50%, you'll be only down by £2500 and not £5k. Don't let it be a case of 'quickly come quickly go'. With a bit of trading experience behind you, then make the decision to bring in the second £5k or use it on a nice holiday before going back to work.

Quick question to all.

Is £5k enough to start trading for a living? (This is after the learning stage and regular profits have been made practising)

happy trading

pa

 

[sidinuk]

Is £5k enough to start trading for a living? (This is after the learning stage and regular profits have been made practising)

It depends on what you call a living and what your risk profile is. I trade emini's and expect to make $15-20k (about £10k) per year per contract traded. With £5000 (about $9000) I could trade 2 contracts and expect a maximum drawdown of 30% (per my system profile) and still being able to trade 2 contracts.

 

[undertaker]

shakeastikat,

why don't you set up a Futures account??? - speak to Jerry Miller at Trendsignal and check out www.twowayfutures.co.uk (they use IB) - the spread on futures is only 0.5 points!
+ you will 'only' need approx £1.5k to set up the account.

I will be starting with the £5k and sticking the other £5k in reserve - not planning to live off this pot as I have other arrangements in place to cover my living expenses - all my profits will be re-invested back into the pot.

I leave work in Aug - can't wait!!!

 

[theblackmamba]

undertaker - read and understand the book trading in the zone by mark douglas. well worth the money imo

 

[Mr Euro]

I beleive you could trade with only £5k in a spread bet account but to earn a living you will be sailing a bit close to the wind for a while, in fact more than a while. This adds to the pressure and won't make your task any easier.

The other problem is you would need to use a lot of margin and one hit could wipe you out. It's ok saying I'll use correct MM and a SL of X but if you are leveraging and get whacked by a profits warning/takeover you'll be cream crackered. How many people were wipped out last week with M&S?

The other problem I see for you is what you intend to trade, futures ain't for beginners and will only help you lose your money faster.

Good luck.

 

[shakeastickat]

The Bramble
of course strict money management,fairly tight s/l,s trades in profit will run till there is a signal to indicate they may have run out of steam.what will I do when/if I achieve a points target? Take Friday off : )
Thank,s for your reply it was actually quite thought provoking.

The Undertaker
going to stick with what I know for now,"futures ain't for beginners"seems to ring a bell
My own venture in to the fray will not be till mid July which is when I intend on finishing work although I have to say this may change due to other influences,stillhave to set up data feed etc.