Today's topic, one that I am asked pretty frequently, is how much money can one make trading stocks?
After all, this is why we're getting into it, right?
You want to know how much profit you're able to make, how much investment you're able to do in order to sustain a good income.
The first thing to determine is what your goals are with stock trading.
For a lot of people, they like their day jobs, they want to stick to their nine to five and their business, and they just want to make some additional side income through investment.
Others are looking to make investments their primary source of income.
I’m going to lay out the basics of what you can expect trading stocks and how much money you'll need to get started as well as where the profitability can come from.
First of all, how much money do you need to start?
So generally, I advise that any student starts at around $2,000.
$2000 is a very good base limit and for a lot of brokers, that's exactly what you need in order to unlock a certain level of features
Feeling like you need to hold off on investing until you have a large sum of money you want to work with is usually a massive, massive mistake.
Over time the amount of income and profit you're able to make compounds and gets larger and larger.
Now, if you’re dedicating your time to this and you get really involved with the research, with studying and trading, you can potentially become a skilled trader in about three months.
That's how much time I would spend learning about the markets before you actually begin full-time day trading.
But you can also get that same exact experience of practicing your trades by doing something we call virtual trading or paper trading.
With virtual trading, you're basically able to buy and sell stocks with demo money so you can understand how it would be if you were trading in a real-life scenario.
Let’s say finally, after three months, you're able to get your account to $5,000 between a mix of savings and growing your account through successful trades.
So what you could probably average with the $5,000 account is anywhere from $1,000 to $2,000 a week from profitable trades.
Once you have an account size of about $15k, you should be able to earn around $10k a month based on your investments.
And that's when you would want to go into day trading.
Another great thing about penny stocks is that there's the potential to make 50-100% gains in a single day.
Those are the moments and opportunities that we're after.
All you have to do is have a proper watch list and then have your software set up alerts. That way you get notified right away on your phone.
Once you have your setup on your browser or phone, you’ll want to receive notice when the stock breaks the 52-week high.
I often find, however, that people end up losing money because despite having those 10-20 stocks in your watch list, you might not notice much activity going on.
This leads you to start scrambling around, going to chat rooms, hanging out in the forums, and eventually you end up just trying to grab the wave.
Often times that’ll end up going against you.
It's important to be patient and have the necessary perseverance.
The whole goal is for you to become a better trader, then you'll be able to know which opportunities to take and which ones not to take.
All that’s required is time invested.
Start back home.
You can check out our series where you can watch me live as I analyze real-time stocks and trading.
With the right amount of personal investment and dedication, you can learn all there is to be a successful trader.
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