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
<t...@franklinisp.net <mailto:t...@franklinisp.net>> 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.**
**739 Commerce Dr.**
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*From:* AF <af-boun...@af.afmug.com
<mailto:af-boun...@af.afmug.com>> *On Behalf Of * Steve Jones
*Sent:* Monday, April 12, 2021 1:02 PM
*To:* AnimalFarm Microwave Users Group <af@af.afmug.com
<mailto:af@af.afmug.com>>
*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
<cpeter...@portnetworks.com
<mailto:cpeter...@portnetworks.com>> 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
<cpeter...@portnetworks.com
<mailto:cpeter...@portnetworks.com>> 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
<thatoneguyst...@gmail.com
<mailto:thatoneguyst...@gmail.com>> 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
<cknauer.li...@gmail.com
<mailto:cknauer.li...@gmail.com>> 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 <thatoneguyst...@gmail.com
<mailto:thatoneguyst...@gmail.com>> 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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