IS trading for you? It's a question everyone attempting to trade needs to seriously answer. The chart above illustrates two monthly targets ($5000 and $2500). A seemingly reasonable starting point; no get rich quick, earn as you learn, etc.
But on a closer look, small contract traders may need to trade multiple months to reach the target, and this assumes they learn to trade with a winning strategy before crashing their account.
If they can be successful and grow their account, then the targets could be reached on a "trade" basis rather than a month basis.
A goal to target is to accumulate 20 times your monthly take home pay. $5000 per month time 20 is 100,000. Earning 5% per month on your savings will equal, yes, the $5000 monthly take home pay.
At a margin rate of $500 per contract, $10,000 will be sufficient to trade 20 contracts, and you could set your trading to 10 contracts holding 10 in reserve. Even at 10c's you would need 10 points per month to hit your target. The balance of your savings is invested in equities etc per your individual requirements.
If you can take the time to learn trading, keep you risk in check, and let your account build, you will be able to trade more contracts with confidence and reach your monthly target. Any extra, give yourself a raise or move it to other investments.
It takes time, patience, and study.
Some will look at this and not bother for 5000 or 2500. But they would miss a very important point: the 5000 is potentially one trade with 20 contracts ( a 5 point trade). What they miss by exiting is the real question, "How many of these can you do in a month?"
Good Points.
ReplyDeleteWhere can you trade for $500 / contract??
Try TransAct Future and other leading firms. The reference is for E-mini ES contracts.
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