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Online Share Trading

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Porshe
Contributor
May somebody indicate to me capital needed for trading please
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14 REPLIES 14
SimonPB
Valued Contributor
how long is a piece of string ?? me thinks ideal is R100k .. you could try (an likely fail) with R30k or so ..
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Mol
Frequent Contributor
Me started 2 jrs ago trading warrants with 20k. Lost it all. Again started with 10k. Now I am on 70k. Wont lose again. Its a learning proses.
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john_1
Super Contributor
well actually its a simple calculation...if trading cost for shares require a trade size of R10k to get lowest cost to trade relationship..and no trade should represent more than 2% you need a minimum of R500k.. but to start investing you need R10000 as that is the smallest amount you are advise to buy in related to cost...start out investing!
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john_1
Super Contributor
Also if one applies the same principle to trading products were the cost /trade size relationship is R5000 min size..then one needs 250k if trade size is no more than 2%...that said you can always start with less.. but your odds of success reduce with each rand below this min threshold.
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Not applicable
John, correct me if I'm wrong, but is the 2% rule not calculated on the amount you are willing to risk (stop loss)and not the trade size?
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john_1
Super Contributor
no the 2% is trade size, stop loss needs to be +- 20% of the trade size..that way you can be wrong 50 times in a row and still you have only lost 20% of your capital...and if you getting it wrong 50 times in row..you need to get a new stratergy..
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SimonPB
Valued Contributor
disagree .. the 2% is your risk, in other words your stop value .. say you got R100k, 2% at risk is R2,000 .. so if your entry is R10 and the stop level is R9 then you have R1 at risk per stock and hence can buy 2,000 stocks ..
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john_1
Super Contributor
thats makes sense.. except that way you get less than 50 chance to total wipe out, my way you get a whole lot more.. both work, but I would sugest that yours is great when the odds are in your favour and you know what you are doing.
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suki
Super Contributor
Lets turn my R100 000 into R700 000
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SimonPB
Valued Contributor
well you get an infinate amount because as you losing your R100k is dropping and hence so is your trade size .. an in theory you'd never get to zero, albeit trade sizes would be way small .. so not infinate, but plenty ..
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Terra
Super Contributor
Watch Traders Corner on Mondays at 18:15. Garth McKenzie demonstrates 1-2% risk, and explain the mechanics of the trade.
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prancing_horse
Super Contributor
Suki,it appears you find it hard to believe that 10000 can become 70000.In the Make a million starting towards end 2008, PSG's competion was based on SSF starting with R10000, this morning that account was worth R74000 with a small exposure to GND.Six months ago it was R72000, just shows the easy money was made from april09 to about sep.My CFD account has only grown from R250000 to R279000 the reason is simple, I was happy to 'blow' 10g's but now not happy to lose 70 or 250 so now I'm very cautious before commiting too much capital to a trade.I've decided to transfer 50000 to my long term portfolio and start trading more boldly with 25000 that will be left in my SSF account.Yes 1 can become 7, just as 7 can become zero
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suki
Super Contributor
My point was, i admire you. i wish i had that skill. i know its possible.
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suki
Super Contributor
please send me your email address on the following [email protected]
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