You will not survive! GREED and STUPIDITY go hand in handTo long term success is this business you have to avoid using too much leverage! I recently did a challenge to see if I can actually make money with $20. The result of that was not so great ,and the main reason was because I went in too big.The fact is that making money with a small capital is very hard.For one you won't make much an any given trade. Second, you will probably want to use more leverage because it's such a small capital. Let's all admit leverage will kill you no matter how much capital you have.
I would say that trading with a very small capital is not worth it at least not as low as $20. I believe that saving at least $1000 to get started is reasonable.This way you can avoid using too much leverage and also have the possiblity to make some decent money.Don't get me wrong I'm sure someone has made a lot of money starting with a very small capital, but that's very rare it's like winning the lottery.
Have you ever heard of a trading going from 100-10,000 in a week? Well most likely that trader went back to zero. Why? I will tell you why because trader's like that usually use too much leverage, and when you use too much leverage you can't have any consistency.Most of the time their account can go from 500 to 1000 then back to 400 and then back to 1,200 and so on. This is a horrible way to trade because you will start to have fear, live off hope, and be very emotional.Having too much leverage will test your greed level.The more greed you have the more leverage you will use.
Now, let's talk about entires it's a good thing to have good entires in any given trade. We also know it's impossible to have PERFECT entires 100% of the time because markets are unpredictable.For example trader (A) can have great entry using a lot of leverage, but the pair spikes up resulting in the trader blowing his account. On the other hand trader (B) didn't use much leverage so he was able to hold on until the trade came into his favor.When you have such a small capital you really don't have much of an option but to use a lot of leverage this is another reason to wait and save instead. We see it all around if you over leverage in real estate, in business, or anything you most likely will lose.
Quote:"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis."-Jesse Livermore
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