So what am I getting myself into?

[Rock84]

Wow. My intention sure as **** wasn't to provoke this much emotion.

Anyway...Thank you to those who actually provided something useful, I'll definitely take your suggestions and advice onboard.

First off, I'm a noob in practice but have been following certain markets, reading a lot of blogs and newsletters like Sovereign Man and The Daily Reckoning (among others) for a little over a year now and have now and the main reason I haven't started trading (or investing as TabJockey said, is the better way to put what I'm looking at doing) is because I've been traveling and wasn't able to put as much focus as I'd like to into this.

To clarify, I'm not looking at this to solve all my money problems, I have money and have a job and can save perfectly well, but dropping 20k+ of my hard earned at my level is obsurd and would go against every single cell in my body. Waiting til I have a 'spare 20k+ just gathering dust is also obsurd. To be more specific, my goal is to invest, and reinvest as I earn. So maybe I need a specific broker for this? Either way, starting small on something that I can afford to lose I think is the way to go. 1k sounds reasonable.

The reason I specified world markets is because I'm not wanting to miss opportunities when they come up. In the past I've come across stock investment opportunities overseas.

As for Forex, this does seem like something that can be picked up relatively quickly, I have had a demo account and played around with it, and understand some Forex markets and why they move, so this will probably be my entry into day trading, if/when I get to that stage.

So, based on my revised criteria I'm happy to listen to advice/opinions.

I'll check out IG Markets and CMC.

Cheers,

Rob

 

[LostMyShirt]

I am also new to this, Rock. However in my short time of learning about stocks after incurring very slight losses I have learnt a thing or two, however have yet to capitalize on it.

Try, www.chartschool.com to start your learning of charts. Trading shares IS hard work! It requiers patience, dicipline and a keen sense of a deal. Only the shrewd individuals will win in this game. So take the time to educate yourself on your pick before putting your money in there, or else you will be stuck learning the hard way, like me.

As you can see, I have lost my shirt

 

[Smurf1976]

My opinion is that you are better off learning ONE thing and doing it well rather than attempting multiple strategies all at once and messing them up.

If you only speak English and want to learn Japanese then that's all well and good. Trying to learn Chinese, French and German at the same time is going to make for one almighty confusion most likely...

Learn one thing first. The other markets will still be there tomorrow.

 

[LostMyShirt]

My opinion is that you are better off learning ONE thing and doing it well rather than attempting multiple strategies all at once and messing them up.

If you only speak English and want to learn Japanese then that's all well and good. Trying to learn Chinese, French and German at the same time is going to make for one almighty confusion most likely...

Learn one thing first. The other markets will still be there tomorrow.

I suppose that is a decent plan. Then again I didn't think learning the two basic aspects, fundamental and technical analysis would be a daunting task. Then again, if that be the case - learn fundi first perhaps?

They may still be here tomorrow, but your dreams may not....

 

[Billyb]

Hi Lostmyshirt

Some of the folk here are often pretty blunt sometimes, they forget that they too were once beginners exactly like you, looking for friendly help as well...
Anyways, there is still a lot of wise content in their comments, starting with the fact that $1k is not enough.

But basically
Don't even think about commodies or forex right now as they are leveraged investments suitable only for very experienced traders. That leaves basically stocks. Any Aussie broker (comsec etc) can get you into the stockmarket and they don't usually have any minimum opening balance but brokerage is the cost you need to worry about. Comsecc's brokerage is $40 per trade (buy and sell), so on $1000 that means you need to make 4% profit just to cover brokerage. This is one of the main reasons why $1000 is not enough.

There's a lot to learn. While you are saving enough cash to open an account you can start to study and work out what kind of investor or trader you want to be. Then you can start to paper trade to build your confidence. Now's not a good time for beginners to be in the markets anyway.

 

[LostMyShirt]

Respect to the wise and abhorance for their ego's.

1K is a measly amount - however it can work for you quite well.

Yes, broker fee's are important to take into consideration. They eat into profits.

Now; I started with 1K. I jumped in with the idea of being a medium-long term investor. In other words, I wanted to find a small company, and up and comer into the industry, and invest. Of-course, it took a lot of reading before I jumped in. The idea was to invest the 1K, and top up as time goes by.

Now, due to personal financial reasons, I needed my thousand back. We won't go into why.

2 of the stocks I picked make decent profits in a single year. One made 100 percent, the other made 3000%. Now, I have been told that the latter company is akin to a lottery, but is it really? 3000% is a heavy amount, but wouldn't one be satisfied with even 1000%, or 500%?

The fact of the matter is a 1K starting amount is fine - it is enough to begin with. You will not make large profits fast - but you can start there and get a feel for real trades. If you become confortable with your long term or mid term pick, you can top up from time to time. So, in my view, the best thing to do with small amounts of money is mid-long term growth. The stock market is not a lottery - they are companies doing their best to grow. Small companies become big companies all the time - it is the way of the financial world, if of-course they are competative enough and strong enough to get there.

So before those "experienced" ego maniacs jump in and respond to a very humble trader, such as the OP, with outlandish comments such as GO AND FIND 50K (no doubt to project a reflection of their own status), stop and think what a good trader who has done his homework can do with any amount of money. The OP did not state he is wanting to make a million overnight.

 

[theartglasshouse]

$1,000 is perfectly fine to start of with, but ensure that you invest that $1,000 wisely. I usually study a company for 2-3months before investing in it. My first share buy was NST, which has come back to me quite well and is still going strong . It is setting me up for a good trading account for the future.

Another one I thoroughly enjoyed investing in recently was IVR. I put $850 in the pot for that one and sold out for $2,000 due to the good announcement they put out. All within 3 weeks

So trust me, you don't need $50,000 to start of with. And generally just ignore the 'rude' comments here and just use this place as an arena to gather information for you own gain. Some of the over inflated ego's here are good for a laugh but that is about all

Also, just use a place that has the lowest brokerage fee. I use belldirect.

Goodluck, that $1,000 if invested wisely can lead bigger things!

 

[LostMyShirt]

TheartGlasshouse,

Excellent post, and I must agree on all points.

I also wish to compliment you on the good picks - and respect the fact that you realize it is not the money but the knoledge that counts. A good trader will turn his 1K into a lot.

May I ask, what are the main things you look for in a company when making your investment? I wish to know out of curiosity and the OP would also find the information useful.

 

[tech/a]

Kiddies

Trading with $ 1000 is putting you way way behind the eight ball to start with
Here commision becomes an issue.
You can't spread risk.
You can't even position size correctly.

You will be limited to 2 positions $ 500 min each trade.
$1000 won't even get you a decent computer.
The ideal is to trade with well over $100,000

Strange how experience is seen as ego.
Then again I guess not I was a dumb ass know it all kid once myself.

 

[LostMyShirt]

You are correct, Tech/a, on the point of risk and diversification. But the fact is you can make it work.

You can't run all the systems of spread, risk management and diversification. You only have the tools and strategy to find a decent pick, and there is no certainty.

A know it all Kid and a know it all Veteran are two sides of the same coin.

With a small amount like that, it is possible to earn very slight side income, which always helps - though is not going to sit you next to Murdoch. The point though is that you earn and re-invest and to do so you need a solid strategy.

 

[tech/a]

There are rare instances where a long term base is built from next to nothing.

But anyone who has attempted to run even a part time business valued at a Few Thousand will tell you failure is almost certain.

No different trading--- other than 95 % of people who have a go at their own investment or trading fail.just look back on all those traders who come and disappear from this forum.

I'd argue that this know it all vet has the proven track record
If the know it all kid is on the same coin I'm on the wrong currency.

Further I would suggest that a noob and $1 k couldn't out perform a vet with $50k in a Year.( in % return) terms.

 

[Garpal Gumnut]

I've tried to make sense of your quest, Rob, but am unable to.

Where would you like to be in ten years time?

gg

 

[LostMyShirt]

Further I would suggest that a noob and $1 k couldn't out perform a vet with $50k in a Year.( in % return) terms.

Of-course not as the guy with 50K can diversify and have an accumulated percentage providing it is majority wins. Not only that, you are comparing a learner driver against Schumacher.

Well, this is getting slightly off topic. I still don't agree that 25K+ is a prerequisite, but totally understand the arguments for it, and agree that a larger starting fund would be ideal.

 

[tech/a]

Ok
Let me put it this way.
Starting with $ 1000 won't give you the opportunity to learn how to trade.
It's like buying a business for $1000 and expecting to expand it with capital earned.
Under capitalization can be a real killer.

All your doing is having a $1000 punt on a few stocks.

That's it----an educated punt.
Like looking through the form guide and picking a horse.

If you call that trading or investing you've not passed first base in your education.

 

[tech/a]

By the way I can have 20 % winners and still out perform a trader or investor who has 50 % + winners.

 

[LifeChoices]

I don't think you should trade the markets with 1K - it would be soul destroying and will end in tears.

If I had 1K to lose, I'd be making a night of it and would go down to the dogs on Monday nights and eating bad hot dogs and getting prison tats when I win - you'd have more fun doing that for heaps longer.

DYOR

 

[nulla nulla]

And with a half decent capital base you can have cumulative 1% winners and out perform the 50% winners.

No offence, watching this thread has been entertaining. It swung from the noobie seeking advice from the experienced to the noobie asserting what could and couldn't be done.

The proof is always in the pudding. As in business, the majority fail for lack of capitalisation and business acumen. Trading, whatever instrument you choose, is a full time career and not a part time hobby (Unless of course you are filthy rich and only do it for fun).

T/A is right, build up your $50k base then choose your weapon.

 

[satanoperca]

Not to weigh in on this discussion but a $1000 to invest.

Okay,

1. Amibroker - Charting Software
2. Data Feed - Northgate
3. Subscription to someone who understands trade, maybe thechar?????t
4. Time : Min 12 months research and learning

What is gained, some tools to not lose $50K playing the share market.

Cheers

 

[LostMyShirt]

And with a half decent capital base you can have cumulative 1% winners and out perform the 50% winners.

No offence, watching this thread has been entertaining. It swung from the noobie seeking advice from the experienced to the noobie asserting what could and couldn't be done.

The proof is always in the pudding. As in business, the majority fail for lack of capitalisation and business acumen. Trading, whatever instrument you choose, is a full time career and not a part time hobby (Unless of course you are filthy rich and only do it for fun).

T/A is right, build up your $50k base then choose your weapon.

Wow.

"No offence, watching this thread has been entertaining. It swung from the noobie seeking advice from the experienced to the noobie asserting what could and couldn't be done. "

Just - wow.

Ok - I'm wrong. Nothing can be gained from playing the share market under 50K. All who invest under 50K, lose. Nulla-Nulla and T/A have established this with the utmost solidity. Put your money in your pocket - leave trading for the BIG BOYS. My sincer condolences to those who have invested $49,990... Because we all know every single trader on Earth who ever made money started with 50K. No knowledge or experience, just 50K. They all had diverse portfolios when they started, because they had 50K. Found a very decent entry into a very cheap low cap with established growth potential? Don't have 50K? Then go to the TAB./sarc

It is as if I havent made myself clear. I understand the benifits of trading with a significanly larger base - they are obvious. But is it an absolute prerequisite? NO!

 

[nulla nulla]

Wow.

"No offence, watching this thread has been entertaining. It swung from the noobie seeking advice from the experienced to the noobie asserting what could and couldn't be done. "

Just - wow.

Ok - I'm wrong. Nothing can be gained from playing the share market under 50K. All who invest under 50K, lose. Nulla-Nulla and T/A have established this with the utmost solidarity. Put your money in your pocket - leave trading for the BIG BOYS. My sincere condolences to those who have invested $49,990... Because we all know every single trader on Earth who ever made money started with 50K. No knowledge or experience, just 50K. They all had diverse portfolios when they started, because they had 50K. Found a very decent entry into a very cheap low cap with established growth potential? Don't have 50K? Then go to the TAB./sarc

It is as if I havent made myself clear. I understand the benifits of trading with a significanly larger base - they are obvious. But is it an absolute prerequisite? NO!

This little tirade comming from someone that has already admited the he lost his shirt.

Dealing with shares: To buy and sell shares you need to deal in marketable parcels with a minimum value of $500. For $1,000 you can buy two (2) parcels of shares of $500 ea or one parcel of $1000.
To cover the cost of brokerage, $19.95 in and $19.95 out, you need to make a profit of $39.90 per trade simply to cover brokerage. Buying and selling at this level you are going to be a long time in the market (if you are successful) building your fortune. Of course if the share value of your parcel drops below $500 you could be a longer time in the market waiting, hoping for it to recover so you can sell it.

In reality if you are starting with $1,000 the best you could do is to learn up on TA & FA and buy a share that has a yield of 10%, preferably fully franked. Each time you save up another $1,000 buy more of the same share or another one that pays close to 10% fully franked. Re-invest your dividends and keep slugging in those $1,000's and eventualy you will have a portfolio worth $50,000 and you will be in a better position to trade.

Also by that time you should have learned about risk assessment, money management and have identified the area you are comfortable buying and selling in. Good luck.