Hi, I've got a small portfolio (3K+), and probably only about 4K in cash savings, and quartely bonus payments (2-5K), I use a leading online broker, I've been reading a lot about the markets in general, but have only 2 months experience so quite naive still (but keen as anything!).
Now, when it costs $20-$30 for a trade, and you have $1000 worth of stock, you can get a 10% gain, to $1100, which is great, sure, but selling from that position will cost $20-$30, leaving maybe $50 for the trouble...
Which is still a profit, but you need a 10% gain to achieve that. So instead I leave it and the gain withers away, to be lost the next day, or the next hour.
Sure - your going to say, the market is for the long-term, and yes I am in it for the long term but really, I'm just the sucker who has helped everyone else extract their profits...
Now getting to my point of this post, what if I bought $10,000 worth of stock, without the funds, hoping* that the stock rises, if it does - sell, if it goes below some sort of threshhold say 5% down ($500 loss), I also sell.
So I risk $500, but it could go up 5% and I gain $500. (+- trading fees)
Sure its risky, but days like today were pretty obvious most things were going up. Is this a legitimate way to conduct business? I've sort of read about long puts and naked puts but get lost in the lingo, and don't think this is the same thing.
Anyway, just wondering what everyones opinion is on this, good or bad!