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Do you really need twenty five thousand dollars to get started in day trading, or is that just the plot they have to tell you?
Hey Traders, I’m Marina, The Trader Chick, and today I’m going to give you the heads-up on a misconception that you got to get over. This is Confessions of a Trader Chick. Are you ready to learn the real truth?
OK, so when I began trading, I was told that you needed twenty-five thousand dollars to have a trading account so that you could actually day-trade, if you have anything less than that, you’re only allowed maybe to make like three or four trades per week.
Right. So that is a truth to some extent, because that is what the market and the brokers wants if you are trading stocks and equities. However, there are many other markets that you can trade, and I’ve got videos that you could check out, It’s in the description, about the four or five different markets that you could trade. The majority of them you do not need that kind of money to begin, on the contrary for instance, I trade in emini futures.
You could get started with less than a thousand dollars a week, so you could start with less than a thousand dollars in your account. Now, this is something that is really, really important. And this is something that the brokers love to tell you in pretty words. And it is a lie, and it is a danger, and hazard. Margins or that you have the power to trade with a certain amount of money. So let’s pretend you have the twenty-five thousand dollars.
All of a sudden, you actually have the power of trading with a hundred thousand dollars. What does that mean to you? A lot of people say here, oh, I have all that lending power. I could use all that money. Cool. All right. So let’s say that you end up buying a stock, and you use that one hundred thousand dollars because you think it’s going to go up or down, depending on if you’re longing or shorting it.
That’s up to you. All right. But what if it does? And what if you lose? So now you have technically, physically twenty-five thousand dollars, but you have the power to trade with one hundred thousand. You lose all that money. What? What happens? All of a sudden, you’re out one hundred thousand dollars, right? You only have twenty-five thousand. What are you getting? Seventy-five thousand dollars from where are you getting that?
Seventy five thousand dollars from to pay off the margin. This is a huge misconception. This is a huge lie. And it has to be broken. It has to be broken today. Now, if you’re trading with the emini, the margins, they are worth a little bit different. OK, first of all, you could start with a lot less. Well, now you only have, let’s say, a thousand dollars in your account to trade because you could do that
You could start with that. The margin once you lose that one thousand dollars, there is no lending power. That’s it. And it’s told that it is more risky because of that. On the contrary, I personally believe stocks are more risky because of that lending power, because when you have twenty five thousand dollars in the bank, the brokers are taking advantage of you because of that. And they’re giving you this extra money, this margin money to trade with.
It’s like going to the casino, getting your chips, and all of a sudden you’re out of chips in your and you’re borrowing money from the casino. And you know what happens when you lose? They come after you. That’s what the brokers do. That is that lending power, that beauty power of having that hundred thousand dollars to work with. No, it’s not real. So you could start with a lot less money looking at the different types of markets, but also make sure that you are understanding their margin rules in futures.
Recommended Read: How to make a living trading futures?
The margin is the money that you have in the bank. In equities, the margin is pure lending. So do you really want to be in debt? Do you really want to be in debt? Think twice, because that is a misconception. I’m Marina The Trader Chick if you need help. I’m here to help you. I’m here to give you the reality of what it is. Furthermore, I am here to make you see that you do not have to go into debt.
You do not have to have a lot of money. So you can start small. You can just try it out. I also have a free mini course simplifyingdaytrading.com, where I talk a lot more about this, the misconceptions, the scams, the understanding. So your trading can be simple, and it does not have to cost you a lot. You can start small, and you could really enjoy it and not worry about so many other things.
Subscribe to my channel for a lot more of these confessions. And if you want to chat, Marina, thetraderchick.com check it, talk to me.