I want to achieve the impossible: become a successful trader from starting capital of £50. This is the very minimum deposit required at the financial spread-betting sites (only available in the UK).
I have started first with UK100 but may also enter Silver and FOREX. I’m working with a 1 or 2 pip spread and the initial size of my stake will be £1. It’s that simple. Anyone one want to join me in this attempt please post your experiences.
I’ve read plenty on the internet, watched youtube videos, where I’ve been told that it’s impossible to become a successful trader without £5000, or at least £500 minimum. Well, in the short term I’m prepared to put £500 to it but not £5000. But I’m not even going to start with £500.
My attempt to go from £50 to £500 could help others understand the difficulties of trading and - if successful - some inspiration that learning can pay off, for relatively little down payment. It will also give me experience of trading for real money - and the psychology involved in that - possibly cheaper than were I to start at a larger amount.
BTW I’m not a professional trader pretending to be a newbie (this will probably become obvious!). Three months ago when I wanted learn how to trade I thought I’d have 50% chance of being right, straight away. After all - the price will either go up or down. 50% chance! I lost £100 in 12 trades, only one of which was correct. So you can’t get more hopeless at trading than me.
Okay, it’s not quite true: I’ve had three month’s practice so I now I can look at the chart and can guess which way it is going about 80% of the time. If you want to try this you may need three months preparation.
My currently meagre ability is mostly because I recognise “Ms” (rounded tops - or a “tit’s up” formation ) and “W” (“bottom’s up” formation), ascending and descending triangles which form along support and resistance levels, then breakout. However this knowledge isn’t necessarily enough to go from £50 starting point as I don’t always know how far the breakout will go, or initially reverse. We’ll find out! (I’ll combine this tits up/bottoms up strategy with other indicators).
I have tested a much more promising high probability strategy that is about 85% for at least 15-20 pips with little swing (relatively tight stop of about 15 pips). Some of the remaining 15% could be caught too. However I would only start this with a decent amount of capital - £500. So I want to go from £50 to £500 so I can use this even better strategy. Or I might give up and decided to start with £500.
Why even bother starting from £50? First, the challenge. Second, to gain the experience.
I’ve found out from small scale attempts with other strategies that following any “only enter if X and Y but not Z are true” strategy is more difficult than it looks. In fact, I’ve made mistakes trying to follow a specific strategy that I would have never made just looking at the chart and thinking for myself.
The probability rate is a lot lower than the paper rate of any strategy, due to one’s ability (or lack thereof) to make accurate observations, and make subtle judgements quickly. It’s easy to get so excited by the prospect of winning your imagine an entry signal that is not there.
This is true because using an “if X and Y but not Z” strategy is just like trying to execute a golf swing which is made up of “do X and Y and not Z” component movements. It looks easy when a professional does it, one can understand it on paper, one can explain how the professional does it, but physically doing it takes practice, during which time (costly) mistakes will be made and you feel like giving up.
Currently working from home and for some reason 90% my entry signals occur when I’m working so progress is slow. I will update thread with my progress. Were I to get wiped out right away, I’ll probably have one more go with another £50.
Oh yeah, I began this £50 Challenge weeks ago. I got to £74 then fell back to £47. Yesterday I was £69. Today I’m back to £49.
