Hello... I haven't posted on here in a while, as I have been busy with school. I am almost 14 yrs old, and have $500. I want to make money, and not have to wait a long time to get it. I have thought about it a lot, and decided it would be wiser to invest in penny stocks, before investing in silver/gold. I feel I could buy more precious metals that way, if I have more $$$. The only thing is, I don't know if it is legal for me to trade penny stocks. I would use an iPhone app, like acorns or something. My plan is to 1) Find a good stock 2) buy a large amt. of the stock, and 3) sell an hour or two later, once it has gone up by 30-40%. Say I invest in 3000 $0.10 stocks ($300). They go up by 40% (4 cents). I make an easy $120. I gradually increase the investment amount, obviously not investing all in one stock. This is my plan. If a stock doesn't go up in a few hours, I'd sell it immediately. So i ask: 1) How can I trade penny stocks? 2) what service can I use? 3) how can I setup an account? 4) what other penny stock related plans do you recommend/what are your thoughts? Thanks!
funny. I don't day trade so I can't answer your questions but I will say if it was that easy everyone would be a billionaire. i hope it works out for you.
1) You do need to show photo ID and something like a water bill or some other bill in your name which is directly linked to your address so I would say you must have to be over 18 to be allowed to start trading. I agree with Midastouch, you're oversimplifying trading. Penny stocks don't just jump 40% in a few hours. Well, not very often. And in a market that they do jump like that, they're equally likely to fall by that much. If you really want to do some trading, find good companies, look into their reserves, management, debt loading, and stability of supply, etc. Then hold them for some amount of time. That's the way to make money on those stocks. Some have made 6 X gains this year if you caught the right ones but it takes research and a lot of time. Your method is not how you make money mate. I would say you're more likely to lose than to win, because you do have to pay for every transaction buying shares. That means you need to make back at least that much on every trade to even break even. On such small purchases it would be a large percentage just in fees. I wish you luck and I think you are getting interested at a good age if you stick with it. But don't think that this is easy, trading is hard; you will lose if you don't take it seriously.
What about custodial accounts? What do you recommend I invest in at my age? Any good links/tutorials/books?
Do you know what the odds of that happening are? What's your plan if the price drops in half in a few hours?
You can also lose even if you do take it seriously and do all the research in the world. Make no mistake, the stockmarket is gambling, simple as that.
Ok... I will just stack silver and a few grams of gold. It actually makes the most sense... I like shiny things/collecting, I will save money, and make profit in 5 or 10 + years. thanks!
Err, yes it is. Go look up the definition of what gambling is. It's not gambling if you know a stock is going to go up (in your case within a few hours). How do you know this? The answer is you don't, you are gambling it will go up. Do you have answer for the question of what you will do if the stock goes down? And as for penny stocks, there is most often a large gap between the buy and sell price. Under your strategy if your stock hasn't gone up within a few hours you may not be able to instantly sell at the price you bought it at. You can easily lose 10% or more on a forced day trade without the price having gone anywhere. Do that a few times and your money will vanish.
Sorry... I was unclear. By "Oh, and it's not gambling", I was talking about stacking silver/gold. Thank you very, very much.
Gold and silver is gambling just as much. At your age, if you want to Invest $500 the best way possible pick your favouite STEM related subject (Science/technology/Enginnering/Maths) then find yourself a 1st/2nd year college student doing that degree, then pay them to tutor you until the money runs out or your getting straight A's Boring but true
Ok, I should just get tutored? I already have straight A+. (all 100, except for 1 subject, at like 95.) I do however, enjoy programming. I know java, html, css, java script. Right now I'm teaching myself C++ which is just better overall to use for game programming (instead of java). Maybe I could take a course/pay to be tutored on C++ game development. The only thing is, I would keep money, and teach myself. That's how I learned all other programming languages.
Good on you for wanting to make money rather than spend it like most kids your age would be. Try paper (pretend) trading for a year and see how you go. Make decisions and keep track of them in a spreadsheet. Learn everything you can about stocks and trading - it will be useful knowledge for your whole life. Perhaps over time you will realize what type of investing or trading suits you.
Better yet, take just one week and pretend to day trade your $500 every day and see how it turns out for you. It will really teach you the reality without having to gamble your money yet.
Start stacking prep gear, looks like your gonna need it in that part of the world soon, no matter who wins the election.
Obviously you have much going for you. My father inlaw ,a Scottish returned prisoner of war, renovated at least 2 houses and kept building up by studying the horses etc meticulously and bit by bit betting on 2 3 place. Not really recommending betting on horses but that attitude of bit by bit, building using bare minimal of tools. Yeah plan ahead, get lots of experiences to draw on but have a life as you travel, remember people, family are soo important, and greed isn't good, Learn how to be an asset , seems like you are, your questions say a lot, all the very best.
