The Money Mustache Community
Learning, Sharing, and Teaching => Investor Alley => Topic started by: trailrated on September 22, 2014, 09:17:25 AM
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I have a coworker that is interested in day trading with a small amount of capital. We are having a "competition" first to see who comes out on top over the course of a year (maybe longer after), me with indexing or him day trading. If he beats me he is going to put a little in the market after. I know one year is a short period of time etc... but it is for fun.
Here comes the stupid question...
Does anyone know a site or an app that one can daytrade with fake shares? Something that takes into account "transaction fees" etc.?
Thanks!
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http://www.marketwatch.com/game/
I've used that in the past. I know there are some more "virtual stock exchanges" out there as well.
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Sounds interesting.
I have heard that 90% of all day traders lose all their money.
I had a friend doing it and I think it requires a fifth of vodka per day as well, so that needs to be figured into the cost of business. You would also want to figure in computer and internet fees and look at alternative use of time.
For instance if your friend is spending 2 hours per day trading and researching, you would want to value this at maybe $40 per day especially if you use those same 2 hours to earn $40.
That would seem like and expensive hobby then at 14,000 per year, only to loose all your investment?
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Sounds interesting.
I have heard that 90% of all day traders lose all their money.
I had a friend doing it and I think it requires a fifth of vodka per day as well, so that needs to be figured into the cost of business. You would also want to figure in computer and internet fees and look at alternative use of time.
For instance if your friend is spending 2 hours per day trading and researching, you would want to value this at maybe $40 per day especially if you use those same 2 hours to earn $40.
That would seem like and expensive hobby then at 14,000 per year, only to loose all your investment?
I like the vodka idea, now it's a party! Good points on the time, etc. I will be sure to bring it up.
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Don't forget about the tax effects of day trading. I read somewhere on the forum about that being the biggest cost and a nearly impossible hurdle to get over. Coworkers net profit will be taxed at ordinary rates while yours will be taxed at 0% or 15%.
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Don't forget about the tax effects of day trading. I read somewhere on the forum about that being the biggest cost and a nearly impossible hurdle to get over. Coworkers net profit will be taxed at ordinary rates while yours will be taxed at 0% or 15%.
Excellent point!
How does the saying go? "I know rich day traders and I know old day traders, but I don't know any rich, old day traders."
In all honesty, I think a fairer and less time consuming trick for your friend might be to simply pick 10 stocks at the beginning of the contest that he will hold for a year. He is far less likely to lose everything, the taxes will be lower and it might require just one fifth of a bottle of vodka. I say it is fairer because each of your time involved would be low. Although his would still be 10 times as much as yours.
I really do think an average Joe can do pretty good at beating the market by focusing on quality underpriced companies. It is how Buffet did it. Although his time horizon is more like 40 years and most of his money was made off bringing other people into his game and holding GEICO.
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There are a number of online brokerage sites that provide virtual trading. It's a very good thing to practice with, especially for options trading.
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"Fake" Day trading? Sure if you want to waste your time, I put 100% of my stach into Alibaba @ $92.45 a share. Not going to be fake when the stock splits and suddenly my stach doubles in value
(http://banter.wpengine.netdna-cdn.com/wp-content/uploads/2014/07/thanks-obama.jpg)
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TDAmeritrade has ThinkorSwim and the paper trading is pretty good. Can do stocks, options, futures and currencies. Takes into account commissions but obviously doesn't simulate slippage, which can be significant.
Unfortunately day trading is the hardest thing to do successfully, but for some reason everyone starts there first. It would be better to start on the longer timeframes and work your way to shorter ones as you gain more experience.
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Go to CBOE website and sign up to use the virtual trading account (free and realistic)
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I would just try Investopedia's free simulator (http://www.investopedia.com/simulator/). We used it in one my my college classes. I still remember how our team got 20% overall returns on 1 month of trading, while everyone else broke even or lost money. This was back in Spring 2009 and we bought mostly Apple stock.
Yeah, that was a total fluke. I'm an index investor today. :P
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"Fake" Day trading? Sure if you want to waste your time, I put 100% of my stach into Alibaba @ $92.45 a share. Not going to be fake when the stock splits and suddenly my stach doubles in value
It will be a lot more real if you get cut in half on it. I hope everyone understands what they bought with that, because it wasn't shares in Alibaba.