Today is day two of my challenge to day trade with 1,000 bucks And in today's episode, I'm going to walk you through why I chose $11,000 and how I'm able to day trade with such a small account on day one. After a roller coaster of trading going from green to red and back to green, I finished with about $412 But as I said, I didn't know how much my fees and commissions would be until the end of the day. so my fees and commissions were a little over $31 $. That means going into day two I am starting with $1,381 Two: Now remember, the broker that I'm using gives me six times leverage.

So the amount of buying power that I have is that $1300 * 6. Which means today I can buy a little bit more stock than I was able to buy on day one. All right. So now let's look at my first trade for day two.

All right. So Mullen just hit my scanner and this one is is one that was hot in the last couple days. So I'm looking to see if I can get in this right away cuz it's got news. I got a partial fill of 173 shares out of about 550.

Let's see I'm in at 10:30 and it went a little higher which is why I got a partial fill. but now we're stalling out. All right, let's see if I can get out on the offer 1046. that'd be 16 cents.

No fill so far. Uh, so this is a high Day Momentum scanner trade I'm bailing on it. $466 in the red keeping the loss tight. Small loss.

You know that's a little frustrating, but with stocks to hit the scanner and they have news, you just never know. So getting in with a tight stop and seeing if we can let it ride is great. In this case, it stalled out. Small loss.

That's all right. That's trade number one. I'm going to look for the next one and let's see what else we find. So right there.

First trade trade of the day in the red. But don't worry Here Comes Trade number two. Okay, so arbb uh, this one halted up at the open. So here here's what I'm looking at here.

This stock is strong. It was on the high a day Momentum scanner. it was on the top Gainer scanner. The problem is it's under $5 a share.

so I can't use my leverage I have $88,000 of buying power, but only $1,300 of equity. So that means I could buy 400 shares. 4 * 3 is 12200. So I can buy about 400 shares of this which now that it's halted up, tells me well it's got the potential.

So I'm going to look to do a dip and rip on resumption. All right. So orders at 305. hands on the buy button watching resumption showing 297 in right there, 305 and out right there.

Boom. $584 That is a dip and rip on a resumption. Clean. Well that definitely felt like a victory.

but I'm I'm only up $12 on the day, $11 on the day. I'm not making a lot of progress. but here's the thing that I'm reminding myself even these small baby steps are important if I can make even just $50 today. hey, 5 time 6.

That's going to add that much more buying power that I'll have for tomorrow for day three. So maybe today is not going to be a day where I have any big home runs. But if I can catch a couple of small base hits and just add a little bit of progress to the account, that's great. Ultimately, anything I can do to avoid a draw down is important, and adding a little bit of profit is good.

Now for those of you joining for the first time, I mentioned in the last episode that once we cross 10,000 new subscribers during this series, I will reset my account back to 1,000 bucks. I Also said that once we cross 10,000 thumbs up on videos in this series, you will help me unlock my newest piece of inventory. So I can get rid of this old broken monitor here and so I can upgrade this old laptop. All right.

So we're making progress slow and steady just like the small account. Challenge And you can help by hitting the thumbs up and subscribing to this episode. All right. so that was Trade One, Trade Two.

Now let's look at trade number three. Okay, so M MOX halted here. $ 859 is, uh, the resumption. Right now, it was halted at 8:14 I'm watching this for a dip and rip same as Arbb.

So looking for resumption? Just a moment of pause, hesitation, or pullback and then green on the tape. I'm going to hit that buy button I'm going to look for a squeeze higher. Let's see what this does. All right.

So I can use leverage on this and green on the tape. There we go. I'm in at 27 26. Uh, 39 is the halt up but 901 970 on the bit I'm taking it off the table.

Okay, so H 61 $1.50 puts me up$ 72 $73 on the day. just a little quick scalp there. So today the dip and rip on halt resumption paid. That's not bad now that locked up day two.

but I did have fees and commissions. So on day two, I had about $18 of fees and commissions. which meant after the $72 I I really only finished up about $54 So a pretty small green day in this episode. You're going to see day three, day four, and day five.

But let's talk for a second about why. I'm day trading with a 1,000 bucks? What's the why? All right, let's jump onto the screen. Share here. Why bother day trading with $1,000 Okay, here's my wild crazy opinion: I Think everyone should try day trading with a th000 bucks.

At least everyone that is who is interested in actively day trading. And this is for a couple reasons: Number one: small accounts require not only require they force discipline. if you cannot be disciplined with a small account, it will blow up and it will be gone. And that's it now.

What I love about trading in a small account is that if you make a aake and you blow up your account, your account is disabled and you will not be able to trade in it until you deposit more money. And that means you have a built-in resting period a cooling off period. Now some of you guys know my story, but for me, my turning point was a big red day that blew out my account. so I couldn't trade in it until I added more money.

So I had. It was actually like a week where I couldn't trade in it at all and that was the time I spent diving into my analytics, looking at my metrics, trying to figure out what I was doing right, what I was doing wrong. And that's when I made my discovery of the strategy that I actually was the most successful at. But I hadn't realized it because it was buried under so many other trades I was taking at the same time.

Had I been able to just continue trading, you know what I would have done? I would have gone onto a negative feedback loop. a spiral. a downward spiral where the more I would lose, the more emotionally fueled I would get which would increase my share size which would mean my I would take even bigger losses and then my accuracy would go even lower and I would just go down and down and down. I sometimes call it the Snowball Effect And for Traders who have been trading for a while, you know exactly what I'm talking about.

how you can just spiral. So the thing is, if you have a 253 $40,000 account, you could blow up the whole thing in one day spiraling. Now this can still happen with a small account, but with a small account. Because it's a small account, the total amount of damage is limited.

So my feeling is that you can reduce the damage, the the potential damage, and you can lower the stakes from making mistakes because mistakes will happen. So another kind of analogy that I would say is uh, I wouldn't let my son has a beginner driver. Well, he's not a beginner driver yet. but when he becomes a beginner driver I wouldn't let him drive a $250,000 sports car as his first car.

I'm going to assume that he will make mistakes because that's human. We all make mistakes. We make mistakes when we're learning to drive. We make mistakes with a trading account.

So why not make this the the stakes lower? Why not let him drive in an old Volvo like what I had when I was getting started. they're tough as can be you you Dent it so what? It's no big deal. So similarly, with a trading account, by trading in a small account, you're going to make mistakes, but the cost of those mistakes ultimately is lower. And I think my overarching philosophy here is that if you can make it in a small account, you can make it anywhere.

That's the old saying with New York If you can make it here, you can make it anywhere. and with a small account, it really does show an incredible amount of discipline, focus, and resilience. Now I've done many small account challenges and I can tell you each time I have to put my best foot forward I have to bring my best to the table in order to do well. It really requires that of you.

You do not have a lot of wiggle room. I Will say there are some things about this small account challenge that are especially challenging. For instance, the fact that the broker that I'm trading with doesn't allow margin on stocks under $5 That's that's limiting me and it is limiting me in a way that if I had A25 $330,000 account, I certainly wouldn't be limited. So there are some additional limitations with trading in a small account.

That's one of them. A second one is that sometimes I've seen so far in this challenge that there are stocks between five and up that the broker is also just not allowing leverage on because they think they're too volatile and too risky. So with only $1,000 I can't really make that much money I can't really trade them and as a result I'm sort of missing some of those opportunities. So while that is true, what that's also teaching and reinforcing is patience to be patient to wait for your setup.

and then when it comes to strike. All right. So now let's look at day three and my first trades from day three. So on day three, I'm beginning with $1,435 in my account the account's up 40% This is good and 1,400 * 6 my buying power is increasing.

Okay, so today with $ 9,745 in buying power I just locked up. First trade: $188.7 I forgot to press the record button before I took that trade that was a Flatt top breakout I was looking for the break through $8 You could see on the chart how we have support at around 720 this blue support level as we started to C curl over that level and through volume weight, average price I jumped in right there now on this stock I do have leverage so I was able to take a bigger size which is great. That's exactly what I wanted: 1,000 shares so it was just under 1,000 shares I Got a partial fill but got in with about 1,000 shares and got out so 18 cents a share of profit? That's hey, that's a great start I am happy with that. So this stock is interesting to me and I think that we're going to see some more opportunities.

It's up 120% It is one of our leading gainers today. So this I got to focus on and get dialed in and see if I can find a couple of more quick trades. So I'm starting to get dialed in here for a trade over the break of 850. Just a quick scalp around the half dollar and whole dollar.

All right. So putting my order at 851 hands on the buy button. 500 shares? Uh yeah. 5 600? Yeah.

I Want to keep it a little moderate here I don't want to go too too heavy. Not going to do a th000 shares? Uh, just yet. not yet. I already got one good trade today I don't want to give it back I want to add a little profit without screwing up? Okay A little false breakout there.

off of 850 we've got a little shooting star candle forming. Okay, so we're coming back up here and I've got my order still at 850. I'm going to put it for 500 shares. scale down a little bit and I'm looking for a trade here for the Breakthrough 859.

So I'm in here. 500 shares at 825 down 40 bucks right now. Uh, looking for the break through 859? Let's see, we've got 835 there. I'm not loving this right now because I sort of think that should have gone right away I took 110 off the table.

Uh, let's see what this does and I'm out right there I Sold on the offer. Uh so I'm up $214 56 added a little bit of profit on that trade. 500 shares in and out I just got a little little gun shy. a little nervous.

859 now is feeling it's feeling a little heavy here on the one minute, like we're getting a little extended. So that's all right. just going to keep chipping away small gains. and now let's see if this bases out.

Uh, might get another trade for the break of 850. All right. So this is crazy that broke 850 with some Incredible strength and I have a little bit of Fomo right now. but I'm going to look for a dip here for the break over 12 so 250 shares reducing size.

Let's see. looking for green on the tape. there's green on the level two in at 79 looking for the break over 12? Okay, uh. put my sell order out.

didn't fill anything. This is not not exactly I Wanted to see this push right through. I'm going to bail out here. What is going on? Why is my order not filling? Come on all right.

So just gave back a 100 bucks on that. Why didn't my sell order fill at150? So following this trade I realized that I actually hadn't set up my hot Keys correctly and that's why I was getting this or this problem and I was getting it both when I was buying and when I was selling on some of the trades that I have already taken so far, you might have noticed I was getting partial fills. Well it. it also happened here on the exit, so let me show you what what was happening.

All right. So with my hot keys I can choose the way I have the settings um uh, offset. So the way I have it is I want to buy the as for a stock squeezing up and I want to sell the bid for a stock where I'm ready to take profit and bail out especially if it's dropping now. I do try to sell on the ask so I do have a sell ask hotkey and on my sell ask hotkey I'm selling exactly on the ask price, no offset, just that's it.

But on the sell bid hotkey usually I have an offset of minus 10 cents I do 10 cents that way if the if the stock is currently at, let's just say for example, the stock is At150, my order is going to go through for 10 cents below the bid. It's going to go 1140 and that means my order will most likely get filled I'll get filled at maybe 11:45 or 11:42 I won't get stuck. So what just happened on that trade was I got stuck. My order was sitting there at 1150, but because there was no offset, it was pinned right at 1150 but the bid had dropped.

Okay, so what I ended up doing after this trade was I went in and I changed my hotkeys to add the 10cent offset that I normally use for the bid and to add a 10cent offset to the upside for the ask. So if I want to buy on the ask my order by pressing shift one if the ask is currently 1180, the order will go for 1190. That's going to get give me a little bit more room to get in. Now, as it's turned out so far, the partial fills have actually saved me a little bit cuz I had a couple of Trades where if I'd filled the full order, the loss would have been bigger.

but I think that's just the luck of the draw. gen. Generally speaking I want to be able to fill my full order cuz I'm confident in the trade so I need to be a little careful and make sure I'm focusing on the best quality setups, but these are the hot keys that I'm going to use. Okay, so it's day three, the middle of day three I realized my hot Keys weren't uh set up correctly.

So now let's look at the next trade for day three. All right I just have to change my hotkey setting here. Okay, so I got to go Bid minus Uh, let's see bid minus uh, where is it there? it is. Okay, okay, bid minus 10 cents.

All right. so I'm going to do- 10 cents and then that way when I sell it's going to go 10 cents below the bid. Okay, all right. so now that that's done, I'm going to fix the other hotkeys.

Okay so I'm putting my order here at 1121 for 250 shares, looking for that squeeze back through that top orders at 71? I'm in right there at 1140 looking for the squeeze through $150 Let's see if we retest $12 So there my got filled with no problem on the entry down. a teeny bit right here, but looking for the break through 1150 there's 57, 60, 66, 80, 71. All right, let's see what this can do. Is it going to go up to 12? There's 1187 Late 11, 1192, 1195.

Boom Taking some profit through the highs. Nice. All right, that feels good. Of course this one was only with 250 shares, but nonetheless, that's a good trade.

Okay, so still holding 32 shares? Shes now up. uh, over $200 which is good. 200 a day has been kind of my target I would love to hit 200 a day consistently with a small account. All right.

So now I'm putting a new order here for 250 shares. Looking to add back? Let's see if this want to continue up towards 13 high of day. just under right around 1250, there's 1288. Oh man.

All right. well I'm still holding 32 shares up. Over a dollar a share, 13 coming up. put the sell order there.

Uh, there we go. Nice. Sold another 30 share, 25 shares at$ 12299. Uh, still holding seven shares left up? almost.

Let's see coming up on $2 a share. Not bad. That was a nice trade. Wish I'd taken a little bit of a bigger position, put the order on the ask and out the rest 1248.

Now for the fifth trade on day three, I end up doing something you don't see very often. but I did a dip right at the open that gave a nice squeeze. Almost a dollar a share. So let's check out this last trade of day three.

Okay so I'm looking for a uh dip here off of 13 for a retest of the pre-market high around 14. So I'm going to take 250 shares here going into the open and let's see if we get a tested that pre-market high. So in there with 250 at 309, there's 245 260, 270, 288 out $463.30 in commission. Not bad.

About 10% of my profit went to fees and commissions which means I walked away still with a profit of about $415 That is super solid for day three. And that means in 3 days of trading, my account is up 80% Just about that is awesome. Now remember when I said everyone should day trade with a $1,000 account? Let me add a little bit more to that. Yes, I think it's important to day trade with $1,000 account because it teaches you discipline.

but I Want to remind you you should not trade with a real money account until you have first proven profitability in a simulator. And when I mean profitability in a simulator? I Don't just mean like one green day I mean you should have like four to five green weeks at a minimum. that's probably going to take you a couple months to string together. You know, five green weeks in a row.

So I would really encourage you to practice in a simulator Because listen, if you can't make money in a simulator, you have no business putting real money on the line. Let's be honest, real money is not going to be easier than a simulator it it's going to be a little bit harder because there's liquidity issues you don't have in a Sim So first prove you can make money at least in a simulator and then flip the switch to go live. So what I want to do for you guys who are tuning in for this small account series is: I want you to check out. There'll be a link pinned to the top of the description in the comments pin in the comments top of the description.

So I have put together a 30-day trial that is specifically for you guys right here on: YouTube It is a 30-day trial at Warrior trading where you will have access to a trading simulator with real time level two Market Data Hot Keys Everything the same as me so you could practice trading side by side with me and test yourself. see if you have what it takes to be a Trader during your 30-day trial. you guys are also going to get access to my chat room, my live audio video broadcast, my scanners and my charts and my news feed. so you're going to get access to all of that for 30 days to really give it a spin.

We're also going to give you a sample of a few classes from My Warrior Pro Curriculum I Want to do this because I Want to see you know you guys join me. Let's try to do this together. Let's see what you can do in a simulated environment where you're safe and will not risk real money Because as always I'll remind you my results are not typical this challenge. Well, I've been trading for a long time I've got a lot of experience so of course I'm able to do relatively well with a small account challenge, but even I can make mistakes.

and as a beginner, just do yourself a favor and practice in a simulator and check out the 30-day trial. It gives you a chance to test out our tools and practice in our simulator without taking a lot of risk. So check it out. Now let's go back to the slides.

Let's talk about the mechanics of how to day trade with 1,000 bucks. All right. So there are two types of accounts. You have cash accounts and you have margin accounts with a cash account.

The way this works is you can only invest and trade with cash. These accounts are the easiest to open. anyone can open them, but they're restricted by settlement time effective June 1st 2024. Settlement time is T1 Which means you have to wait one day for a trade to settle.

So if you take if you have $1,000 account and you take a full a trade that uses all of that buying power on Monday then you can not take any more trades on Monday But on Tuesday you could trade with that full th000 again. So basically you could trade your full account once each day and then you have to wait for those trades to settle and you could trade again tomorrow. There is no minimum account size for a cash account. you could open a cash account with 10 cents and there are no day trading restrictions.

With a cash account, you could day trade as much as you want until you run out of money. Which with a $1,000 account, well, you could take $1,000 worth of Trades And then once you've taken that, you've got to wait until all of those trades settle until tomorrow. So as an example here, a $1,000 account would allow you to trade up to $5,000 of stock each week with T1 right settlement on on one day. So basically it's your account balance times 5.

that's the max amount of money you can trade. given my goal of trying to get a 10% return on a trade with a 5% stop loss if I put the entire account into a trade I'd net $100 on day one with a Max loss of 50 bucks right now accounting for one red day a week I figure The way I kind of do my. my math is that my weekly goal uh, weekly goal is dailytimes 3 cuz I'm going to hit my daily goal on let's say Monday Tuesday Wednesday and Thursday and then I'll hit my Max loss on Friday and that's usually going to give back one day of progress so you know just to allocate for fees and commissions I Just sort of figure my weekly goal is the Daily Times three. So unfortunately the most I'd Be able to realistically grow my account with a cash account would be 30% in one week and that would be a really solid week week.

But here's the biggest drawback to a cash account. It takes the same level of knowledge, commitment, and skill to trade once a day and make 10% on that trade as it would to trade 10 times a day. So ultimately, with a cash account, you're limiting how much you can grow your account and how frequently you can trade. And given how much you've invested in your knowledge and your skills, why do you want to be held back? You want to be able to trade.

You want to be able to be active. Now, of course, a cash account. For someone trading with one share and just trying to build consistency, and who's treading it essentially like a simulator. That's fine.

But when you're trying to treat it like you know to real money, you're trying to actually grow the account, it's going to hold you back. So let me introduce the margin account. A margin account allows lending to trade with borrowed money. It doesn't change the settlement date.

The trades still take the same amount of time to settle, but you don't have have to wait for them to settle. You can continue trading essentially on borrowed money from the bank, which equals your account balance. But a margin account requires margin approval, so margin approval. there.

It's a long margin contract and the approval and the agreement states that if you lose money that you're trading that's borrowed, you'll owe it back to your broker. So they're lending you money to trade with, and if you lose it, well, you got to pay them back. Now with just settlement, you don't have to worry about that, so some people say. Ross How does it work with trading in a retirement account? I Do have margin in my retirement account my big account, but in a margin account, they will not sorry.

In a retirement account, they do not give you any leverage. So ultimately all it means is that I don't have to wait for settlement. I Could just trade, trade, trade, trade, trade. But I don't have leverage.

The four times or six times leverage that different Brokers may give you. So with a standard margin account, you're going to get leverage. They want you to trade. They make more money when you trade more.

so they want you to sign the margin agreement. They want you to use leverage. Also, if you want to short stocks, you have to have a margin account again because of the risk of unlimited loss. With shorting, you have to have the margin agreement that you'll repay your broker.

So the downside with a margin account is that there are minimum account size and it varies depending on your Br Broker and your location. So ultimately, when you apply for this margin account and you are approved, your broker will allow you to invest and trade on borrowed. Capital Settlement margin. Rather than waiting for trades to settle before the next day, you're just allowed to trade immediately.

that's used specifically for retirement accounts. So let's talk about how leverage works. Okay, so depending on your broker and your location, the amount of Leverage you can be offered will vary. Typical Leverage is four times.

which means if you have a 25 $5,000 account * 4 = 100,000 that means you could actually be day trading with $25,000 of your account and then $75,000 of borrowed money from the broker, which would give you that full $1,000 of buying power. I Don't have to tell you. It goes without saying I think I'll say it. Anyways, trading on margin and Leverage is very risky.

You should never do it if you don't. Always already have a track record of profitability, not just in a simulator, but also with real money. I am comfortable using margin and leverage because of the experience that I have, but a beginner Trader should not. And that's why the United States in February of 2001 enacted What's called the PDT rule.

the Pattern Day Trader rule. The Pattern Day Trader rule says that in the United States if you open an account in the US you have to maintain Ain a minimum balance of $25,000 If you're going to day trade on margin and day trading in the definition written at that time meant more than three trades in 5 days three day trades. So ultimately, everyone who's day trading is going to meet that, uh, that restriction or or hit that limit. So the result is that all of the US Brokers Robin Hood Weeble Amerit Trade, you know all of the Brokers, all of them.

They're forced to in enforce this $25,000 PDT minimum rule. However, International Brokers are not required to enforce that rule That that's a rule that the US made for Us broker dealers. So International Broker dealers. They follow rules based on the country that they're located in.

Now those Brokers will can also allow you to trade in the US market. So that's the type of broker that I'm using. I'm using an international broker for this challenge because they allow day trading with margin and leverage and the minimum account size is 500 bucks. So there are a number of Brokers that offer this.

This video is not promotional to any one broker or another. Ultimately, this is the way I think of it. The a broker is a tool and this is a tool that is a risky tool, specifically the tool of using leverage and margin and day trading with a small account. However, for someone who has proven they have the skill in a simulator and maybe with a cash account with Robin Hood or thinker Swim, you may feel that a cash only account is limiting you and holding you back and you don't feel you're able to just come up with 25,000 So for you, there is a cost benefit analysis to using one of these tools like an international broker.

So ultimately as investors, we have choice if we want to choose to open an international account. we can. but we have to do so. Knowing that there are some different risks with an international account, we we don't have us Deposit Insurance that we would have with a US account.

So I'm not going to put my life savings in international account I'll put a small amount of money 500 a th000 couple, I'm okay with that. but I just have to remember that I don't have the same recourse that I would have with a US broker dealer. And that's especially true if you open an account with an international broker that is in a country that doesn't speak English that then it's like a whole extra barrier of how you communicate with them and everything else. So you guys have to make your decision of what you think is best for you.

For me for this challenge, for the speed that I wanted to grow my account, it was a no-brainer to go with an offshore broker. So with the offshore broker that I'm using I have six times leverage and yes, if I deposited $25,000 I would have $150,000 of buying power. But I don't need to deposit a minimum of 25,000 in my account. And this is the thing that I mentioned before is I think that's way too much risk to take for a beginner Trader to put up 25 Grand that's way too much money.

That's like a you know beginner driver with a fancy car. You're going to make mistakes and mistakes are going to be painful. So instead I would rather trade with a small account so I can deposit $1,000 and then time 6. Oops.

time 6 equals $6,000 of buying power. And now just like that, I see a stock at $5.95 I could buy ,000 shares of it if it goes up to 625. I'm up 300 bucks right? So now I can start to grow my account a little bit faster using this margin and leverage. So on Day four, I came in with $1,850 194 of buying power accounts up over 80% in the first 3 days, which is great.

but on day four I traded a couple different stocks sngx which was a cheaper one so I wasn't able to use any leverage and then Lbph which was a more expensive one. I was able to use my leverage but it's a $16 stock and with bigger spreads I found that the risk on this one was a little bit more difficult to manage and so I ended up finishing the day with profit but it was not a home run. Day Day four: I locked up at in total at the end of the day. Final trade was a loss and so I finished with $93 80 of profit.

but I had $34 in commissions. That left me with less than $60 after fees and commissions. So one of the common team for the first 4 days has been dealing with some frustration around the margin restrictions at the broker that I'm using. so I can't I don't get leverage on any stock under $5 Which means with even with 1,800 bucks, you know the worst case scenario has been stocks that have been like $44.50 because $4.50 I can't even buy 500 shares with my cash and I don't get any leverage but a stock at $55.50 now I I can buy almost 2,000 shares of it.

So now I'm starting to get into a place where if the stock is priced right between five, Six, and seven, I can do some real damage with this account. Now of course that damage could go both ways and I am being cognizant of that. So the way I'm essentially figuring out whether or not a stock has Leverage is by pressing shift one. So my hotkey for shift one right now, the way I have this set up is shift one is share size.

My share size is buying power times 90% All right, so times 90. So if I have $122,000 of buying power or $10,000 of buying power to make the math easy, it's going to enter share size equal to $9,000 of stock. Now with the broker that I'm using on a day-to-day basis my my my typical Us account, they actually show me in the top Corner uh of each of each uh level two window. They show me how much margin I can get and so this one here says 100% And What that means is that I have to use 100% of my cash to take the trade.

In other words, no Leverage is offered whatsoever. This one is 25% which means I'm allowed to use full four times leverage. So I find that to be really nice. The platform that you've been watching me trade uh with this small account challenge does not have that same feature.

So the only way that I'm really able to figure out how many shares I can buy is by pressing shift one. Now shift one is going to tell me the number of shares I can buy, but it does not automatically adjust leverage for stocks under $5 So what I just know is that on a stock that's like $2 I could press shift one and it's going to take my buying power and multiply it by 0.9 And and then what it's going to do is it's going to check to see whether or not the broker has put an additional restriction on that stock. If they have, then I'm going to see that even even though I have my buying power, I still can't take a full position And that did happen on a few stocks. Even today, there was a stock that was $6 or $7 a share and I wanted to trade it, but unfortunately the broker had chosen to restrict leverage on it because it was a more volatile stock and ultimately they're trying to protect themselves.

They don't want to issue margin calls. So what's a margin call? A margin call is when you end up taking that trade. where let's just say for example, you know you buy. Let's say there's a you've got a $1,000 account and you've got six times leverage.

You buy the $6 stock a full thousand shares. which means you've got $6,000 on it and then it drops. Let's just say the stock drops to $3 a share. $3 a share.

You're down three grand. Well, wait a second. You only have a $1,000 account. That means your account is actually negative 2,000 and your broker is sending you a marginal a margin call in that amount.

And they're saying we want the $2,000 and in the US When you sign a margin agreement I mean it's It's like it's like a Lo It's a it's an official bank loan so you now will owe them that money. If you have a car you, they could force you to sell your car to come up with the money to meet the Margin Call They could force you to sell your house. And this is one of the reasons that short selling is so risky. Because even last week or two weeks ago, we saw this stock that went from $25 to $500 a share.

and if you were short 1,000 shares of that, you'd be on the hook for $475,000 as a margin call to your broker. So as a policy, I am not short selling in this account now, although I I may on one or two trades if I see a really good opportunity. it's not going to be my go-to strategy because the risk is too high, but there's still risk. With trading on margin to the long side, you could have a stock that does drop 50% although it's you know the likelihood is there.

I I Suppose right? It depends on what you're trading, whether or not there's news, what the catalyst is, so on, so forth. So there is certainly risk even trading to the long side when you're trading on Leverage So you have to do it responsibly. You have to do it carefully and you you have to work within the restrictions that your broker sets for you. Now, as we talked about earlier in the episode, if I was day trading with a $1,000 cash account, my growth ultimately would be limited.

I I think to probably 30% a week which is I mean that's still great I wouldn't be able to do it exponentially you know to Infinity but you know that would be sort of my my growth limit. Yes, I could trade some crazy out ofth money option contracts that maybe could go up 400% but that's like those are lottery tickets. That's not really the strategy that I trade, which is based on Thousand tens of thousands of Trades of historical data. So for my strategy, a cash account I could grow but it' be slower work.

So with a margin account I don't really have a restriction which is why here we are Day four, my Count's already up 80% and now let's take a look at day five Nei up 84% I've already broken the ice with my first trade on this up $66 a relatively small trade I have right now $1,913 in equity. which means as of now day five, my account is up 90% Okay, so first trade today is in the books and now I'm going to look to see if I can find some more trades on Nxi, but I'm going to tell you this one is going to be frustrating cuz it's right under that $5 price which means I can't buy a lot of shares of it I want to buy 1,000 shares of this and make 300 bucks and3 but I can't afford it. So I'm going to be limited on this one to 300 400 share positions and you know, yeah, I can make 20 cents and make 40 or 50 bucks but it's not going to be the same. So I'm just going to do the best I can given uh the restrictions on it all right? So I just locked up two quick trades on pidu I forgot to record before those trades.

uh I'm back in here at 931 150 shares I'm trading this with kind of small size, you know. I'm I'm a little timid on it, but uh, you know, let's see what it wants to do. It's volatile for sure. Okay, so we've got 960 on the bid 959, so I'm I'm back out of that.

small gains on it. just kind of gosh darn it. I sold it too soon. Whatever, it's fine.

I'm I'm just trying to chip away here. um see if I Can you know $200 already today? I'm feeling pretty good about that. Um I don't want to push it too hard I don't want to have a big draw down. so uh, we'll see if I can add a little more profit without taking too much risk.

All right. So now that Nexi is over, uh, $5 I've got my leverage trying to get in here I filled eight shares at seven? That's a, uh, not even a real position. That's annoying. I'm trying to do a dip here and see if it curls back up towards 750.

Yeah, the problem with eight shares is that the commission to buy and sell I mean I I'd have it go. have to go whole dollar a share even to make eight bucks. So now I'm kind of stuck holding this until I Either add to it or I don't know, just take the loss I guess but let's see what this does. I think I'm going to add down here for the pop back up over seven.

All right. But what is the deal do you see? So my order again partial you I'm just going to get out of this thing. for some reason my orders are not filling I put the order there and it just it did not I filled another 13 shares. so I just lost a couple dollars there on commissions.

Whatever. Okay, so I'm buying this here at 660. Uh, this is 500 shares right off the 20 moving average. This is psychological support and I'm looking for the curl back up to seven.

500 shares could have bought more, but dip trades can be a little riskier. So uh, let's see. So right now, up about 20 cents on the offer, Looking for $7 There we go. there's 87 89 on the ask, 90 good 94 taking half off right there at 7 that's 40 cents a share.

taking another half off there at also about 7even now let's see what else this wants to do. Okay, so we've got a high of day right around 740. Uh, this was resistance. Uh, so got to be a little careful there.

But let's see if this can get back over seven. I Want to see it hold $7 There's seven, all right. So I'm going to take the rest of this off the table here. Uh, not bad.

Honestly, not bad. That was a solid trade sitting at $382 4 on the day. Not bad. This is my third best day so far of the small account challenge.

Now sitting at 558 $56 Amazing! We just got a retest to the high of day. I got a trade there from 720 up to 730 starting to lean in and size up a little bit. I've got a little bit of a cushion so this is, uh, this is really coming together well. I am happy with the action today.

All right. So I'm looking for a trade through the half through the high of day. So I've got my buy button. uh ready to go here.

750 is the order that's the top of the limit. 500 Shars green on the tape. I'm in slow fill but filled at 730. just kind of a slow fill.

It was like filled and then kind of like stalled and then filled the rest all at once. Sort of weird. Not sure why, but I'm in. Um, but there's 40 back to 30 huh? on the offer? 30 on the ass? 38 I'm going to put it out and whatever.

I'm taking it off the table. I I This is having some resistance here. still holding 42 shares. Let's see if I can get out of the rest of this.

Uh, my order's there. it's just not filling. I'm going to sell on the bid. All right, that's good.

You know what? That's a solid day. $579 188. That right there is the best day of this small account. Challenge And there you have it.

The first 5 days are in the books. the account is up 140% I Started with a ,000 bucks. Now we've got $2,400 and I'm going to keep growing this account. Remember once we cross over 10,000 new subscribers? Boom! I'm going to reset the account back to 1,000 bucks once we cross over 10,000 Thumbs up on this small account series.

You're going to help me unlock a new piece of inventory. and I am desperately wanting to replace this monitor right here because it is very difficult to use for trading. It's very hard to see the scanners. Everything down here is impossible to read so I cannot wait for that.

So please smash that thumbs up button. It makes a huge difference for the channel and for my trading station right here. And I Want to remind you, hey, if you want to watch over my shoulder as I'm trading during this challenge, join us for the 30-day trial. This is an ongoing challenge, so join the 30-day trial.

You're going to access to a realtime simulator with level two Market data. You're going to have access to my scanners, my charts, my newsfeed, the chat room, and my audio video broadcast. Plus, we're going to give you a sampling of a few classes straight out of the Warrior Pro curriculum to help give you a jump start on your way. So come check us out over at Warrior Train.com There'll be a link pinned in the top of the comments and in the description to do the 30-day trial and coming at you.

Next will be episode three. Let's see where we go from here. All right, I'll see you there.