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Originally Posted by Envest
Do you need large amounts of money to start with because then even smaller price changes can result in losses and gains ? And how long does it usually take to start seeing profits ? Can this be a good investment model for a teenager with budgets under $5k or should I invest in something else and then return at a later date with more capital ? I'm trying to figure out whether I should seriously pursue this right now or in a couple of years ?
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Having larger sums of money helps, in that you can make a 5% profit and if you are trading with 50,000$, then that is 2500$. OTOH, you need to be in higher liquidity stocks.
Unfortunately, it is much more difficult to double 50,000$ than it is to double 2,000$, just because the larger stocks don't tend to move as much.
The first thing you have to do is establish profitability. In all likelihood, if you haven't traded more than 2 years, or probably 200 trades, then you will still find one of the 100 ways to lose money, and will probably end up losing your 5K. That's just the way it is.
Start out papertrading, then trade microscopic amounts. Once you are profitable in that for a good hundred/two hundred trades, consider scaling up in size.
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