Making 25-50$ a day off 10,000?

[kpx85]

This is more of a question for those out there actively trading. I just barely started buying and selling stocks two months ago. At first I was buying and selling at the wrong times. Buying shares that were cheap and got a few good reviews online without knowing much more. Now instead of losing money I'm at the very least coming out positive on over 60% of my sells (after all fee's).

I was wondering if its unheard of to make... say 25-50$ (on average, per weekday) which adds up to 500$ - 1000$ each month. I know that's a 5-10% gain in a 30 day period and 15-30% for a quarter but is it unheard of for an active trader? Now that I have started to actually gain back some money I lost and really started to enjoy the whole process I have started to wonder about the average's that most come across. Im not starry eyed thinking I will get rich off such a small investment but my interest in growing the amount over a period of time has grown. Any comments?

[Luc1Grunt]

Originally Posted by kpx85

This is more of a question for those out there actively trading. I just barely started buying and selling stocks two months ago. At first I was buying and selling at the wrong times. Buying shares that were cheap and got a few good reviews online without knowing much more. Now instead of losing money I'm at the very least coming out positive on over 60% of my sells (after all fee's).

I was wondering if its unheard of to make... say 25-50$ (on average, per weekday) which adds up to 500$ - 1000$ each month. I know that's a 5-10% gain in a 30 day period and 15-30% for a quarter but is it unheard of for an active trader? Now that I have started to actually gain back some money I lost and really started to enjoy the whole process I have started to wonder about the average's that most come across. Im not starry eyed thinking I will get rich off such a small investment but my interest in growing the amount over a period of time has grown. Any comments?

Those numbers are realistic. You need 25k for day trading status or you will be stuck waiting for settled funds / chasing trades. 10K will work for swings...if you have the patience and a system to follow. Your OP stated "daily".

[aiki14]

I agree with Luc that the numbers are realistic, with the caveat that a prolonged downturn in the market can wipe out a lot of gains. I think you need a few different arrows in your quiver to enhance your chances. A margin account, so you can take short positions is essential, the 25K to give you pattern day trader status, a tax strategy so you don't give back the gains at 35%, and level 1 options to take hedge positions.
If you go in just taking long positions, and waiting for T+3 settlement, it will be very difficult, in fact quite unlikely, you'll see those type of gains on average over a long time frame.

As an aside, it's nice to see you're enjoying the process, and I hope that continues. I have found it a real rush to make money trading, especially when going against trends. Here's to your continued success and welcome to the forum.

[Luc1Grunt]

Fill your cup one little drop at a time.

Be patient with small bits of growth.

Ruthlessly enforce stops.

Exits are more important than entries in 99% of the trades.

Calling tops/bottoms/reversals will slowly grind you to blow-out ( or close to it).

Shorting is half of the market....you need the margin.

[GenNove]

But how would you get paid?
the 1k a month you have t osell your shares right?

[Luc1Grunt]

? Say again all after...."How....."

[spanky]

Originally Posted by aiki14

... a tax strategy so you don't give back the gains at 35%

Aiki, would you elaborate? I'm interested in what you would have to say on this. Thanks

[Luc1Grunt]

Trader filing status allows Mark to Market as opposed to wash sale

LLC allows the business expenses

Treat ALL trading expenses as business expenses to include internet, platform, magazines, home office, sexitary named Brandi etc.

[aiki14]

Originally Posted by spanky

Aiki, would you elaborate? I'm interested in what you would have to say on this. Thanks

If you're a buy and hold type, hold your wins a year and a day, sell your losses a day short of a year. Long term capital gains are taxed at 15%, short term as regular income. All options gains are Long Term even if you hold them a day.
Also it is key to remember the tax man when you evaluate your strategy for trades. Remember the wash rules especially if you are in and out of the same position frequently. If you have a win and a loss on the same stock in 30 days you cannot declare the loss on your taxes, thus your win is taxed at your rate and the loss cannot be written off against it.

http://www.smartmoney.com/tax/capita...tory=washrules

[optiuser7]

From all the above posts , I have the following questions :

1.As a new trader , I have long as well as regular trade but I wudn't call myself as a active day trader yet.
2. I have cash account only with discount broker.

So say if have made gains around $500 in two months , do I still owe a 35% tax of that 500 I made if I did not incur loss at all ???

3.Also if a person has a regular job and still does perform day trading , how does it count towards tax , since this will be an additional income ?