Author Topic: How much money do I need to start trading?  (Read 820 times)

Offline TradingAdmin

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How much money do I need to start trading?
« on: May 28, 2015, 11:00:36 pm »
You need money in your trading account for two reasons:
  • To post margin for the positions you want to enter, and
  • Floating capital to absorb the price fluctuations (real-time profit / loss) for the positions that you have entered and to absorb changes in margin requirements over time
The amount of margin you require depends on the commodity(ies) that you want to trade in - see this link (http://www.investdifferently.info/futureslist.php), the second table for a list of the margin requirements for the different commodities we are looking at.  (NB Please Note:  These margin requirements changes over time, sometimes becoming considerably more, sometimes dropping in value).  There are few commodities with margin less than $1,500.  You want to be able to enter at least two contracts.  Therefore margin alone you are looking at $3,000 or more.  Add a floating balance of at least the same - $3,000 - and you look at a minimum account size of $6,000.

The broker we use requires a minimum deposit of $10,000 to open an account.  You may trade with less, but that is the minimum requirement to OPEN an account.  Of course you do not have to use our broker, you may use any broker you like, as long as he is able to route your orders through to the necessary Exchanges.  There are brokers out there that will allow you to open an account with $3,000.  But to be realistic about this, $3,000 is severely limiting your trading possibilities (unless you are prepared to be really patient and wait for the right opportunities - which means you will probably not trade every month).

What should be clear is that this is not a get rich quick scheme.  You cannot start with $100 or even $1,000 and hope to make a success out of this business.  You need to make a substantial investment, you need to be serious about this business.  However if you are prepared to make the investment  and you are prepared to learn how to, you can make a success out of this business.
« Last Edit: January 26, 2017, 12:42:04 pm by TradingAdmin »