There’s a common saying in the trading world…
You need money to make money.
While that is true, for some odd reason — many believe they need a lot of money to make it as a trader.
To be honest with you, I don’t think it’s completely necessary to start with a massive account — and that’s why I was taken aback when I saw this response from one reader…
I am new trader and not have a lot of money. Can you please also pick some low price stocks so new traders can also trade and make some money.
I want to show you how new traders can tap into the market, and uncover stocks to potentially trade — whether they have a small or a large account.
When I first started out to trade, I pretty much knew nothing about the market. I saved up as much money as I can, and in relation to the account sizes other retail traders have…
I was considered small fry.
However, I didn’t let that stop me from developing an edge in the market.
I just had to tailor my trading to my account size from the start. That meant trading more conservative, not throwing down large bets in random stocks, and only focusing on trades in which I had an advantage.
For the most part, if you have a small account, it’s crucial you identify:
Where you have an edge in the market (is there a specific sector that you’re able to consistently make money in or a specific style that you’re comfortable with).
How much you’re willing to risk per trade, your position size, and time frame you’ll be holding your positions.
Although I have multiple trading edges now, the one that got me off the ground running is my catalyst runup strategy.
The whole idea for me is to identify an upcoming catalyst event, get into the stock (or options) ahead of time, and ride shares higher. I’ll look to exit the trade before the catalyst event, or if it reaches my target, whichever comes first.
Of course, I’m also trading with stop-losses here.
I know what you’re wondering, how can one identify these setups?
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The key is to come up with good filters.
Finviz is a free tool you can utilize to uncover trade ideas.
If you go under the “Screener”, you’ll notice something like this.
In this specific filter, I filter for stocks trading with an average daily volume of at least 750K, price under $10, and market capitalization above $300M.
There are about 340 names, so it’s important you can figure out what’s going on in the market for that week. For the most part, biotech stocks have been hot…
So let’s filter for those for this example.
I like to look under the chart view and identify stocks with specific patterns I like.
So there are about 42 names here, and I can probably get it down to around 5-10 that have catalysts.
Once I’ve done that, I have develop trade plans for each specific stock… and execute.
If you’re a new trader, it can get overwhelming at first, especially since there are so many potential opportunities out there.
The key is to find the right ones and build your account over time.
If you’re struggling to come up with trade ideas or are just overwhelmed, then I believe you’ll love the Fast 5 Program.
It’s all about uncovering the one trade idea that I believe will deliver fast profits. The goal is to get in around 10 AM on Mondays, and lock in gains by Friday.