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itcdr

Made First $1,000 from Trading Stocks!

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Just joined this forum and looking to get more involved in the trading world. Today I just hit the $1,000 profit mark, which has given me the motivation to take things to the next level

 

I am an experienced programmer, which allows me to work from home and set my own hours. About 6 months ago I started looking into trading stocks as the economic crisis had started seriously affect my business.

 

Here's what I've been doing. I setup an account at tradeking.com with $2K and used google.com/finance to keep track of a couple dozen tech and casino stocks for companies I was familiar with. I watched the prices and read the news reports on google finance. Every once in a while I'd make an automated trade when a stock looked good. Keeping it for about 1-3 days on average until it executed based on a LIMIT order. I usually only put up about $400-800 per trade and tried to get a 10% return. It seemed to work. Looking back I have now made 20 trades (buy & sell) since the beginning 6 months ago. Only 3 did I have a loss as the stock didn't look like it was going back up. And now I have just over $3K in my trading account ($1,000 profit after losses and fees).

 

So have I been lucky or am I on the right path? I plan to put another thousand or so in my trading account and start doing bigger trades. Before that though I want to get more familiar with what I'm doing. Any advice on where to go from here? Must read guides, better tools I should use, etc.? I really don't know much of the terminology or anything more than the basics yet. I'm just going off news reports and previous highs and lows

 

- Chris

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put another $1k in the account?

 

no, no, no...

 

take $1k out !

NOW !

 

 

and stop trading for 3 months.

enjoy the glory while you can.

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If you have to ask if you were lucky or on the right path, then you probably were lucky. Were your trades executed and managed according to your trading plan? "Every once in a while I'd make an automated trade when a stock looked good." is not a trading plan.

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Thanks for the quick replies.

 

Were your trades executed and managed according to your trading plan? "Every once in a while I'd make an automated trade when a stock looked good." is not a trading plan.

 

Sorry. should have been more specific. By a stock looking good meant:

 

Examples: Watched a stock's price for a week or so. If it appears to be consistently improving and then a news report just announces an expansion for the company then I'd buy and put LIMIT order to sell when it goes up around 10% or so. Or company releases a bad earnings report causing the stock price to tank. When it looks to be at it's lowest will buy and then wait for a quick rise of 10% or so to sell. Or a stocks price has been stable for a while. Will then use the high and lows average to set up an automatic order to try and buy at the lowest of the day and sell at the highest.

 

So am I adding logic to it, but I feel like there should be a lot more to the game then reading the news and looking at historical prices for a stock.

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Congratulations. Only you can answer whether you are on the right path or whether you are lucky. How many trades? Statistically significant? Longs and shorts or both, Market has been rising for the period you have described.

 

I would be cautious, how you deal with your first largish drawdown is likely to set the tone for your next phase of trading, have you had one yet?

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Have made 20 trades (buy & sell) since starting 6 months ago. Most I've lost in a trade is $70. Most I've gained is $300. average around $60 profit per trade. Have only done regular trades. Selling short seemed too risky.

 

Have traded when the market was way up and way down. Example, I bought & sold 'LVS' when it was around $8 and then again when it was down to $2 and again now when up to $10. Obviously I wish I would have kept it when I bought at $2 but had no way of knowing would come up that much. A friend of mine bought LVS with me at the beginning at $8 and just kept it till now. I made much more with making the little profits each trade so I figure it's best not to get too greedy and not to think what if's.

 

Right now it feels much too simple though. Is there more I should learn first before going with bigger trade amounts? Other tools I should be using? How do the pro's do it?

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You will find it harder in a rampant bear. Some would argue this is a corrective leg of a bear so you may get an opportunity soon!

 

20 is quite a low sample size. Out of interest what sort of holding period? Not that that matters so much (apart from tying up your capital) obviously takes a bit longer to build up stats if your holding period is longer.

 

How much are you prepared to risk on each trade 7% so far I guess. You might find this interesting TradersCALM - risk of ruin menu this is the key thing in trading.

 

What are your criteria for buying? Fundamental, technical, something else? If the answer is with a pin in the paper the answer to is it luck question might become evident!

 

Usually it is easy to make suggestions as more often than not people are clearly doing something 'wrong' or have unrealistic expectations. Generic 'take it slow' 'preserve your capital' type advice is always safe :)

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Guest goodyboo

Market has been up trending well last few months. You may get caught when the wind turns. Make sure it is not your bread you are trading. It may dissapear one of these days.

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