Before I give you some updates on my trading account, I want to let you know, that I am developing a new website for the Point & Figure indicator, as I see that there are many people out there, that like to trade the purce price actions provided by Point & Figure charts. I wanted to thank everyone for your conversations, questions and recommendings…

Updates

Soon, I will set up a forum for all customers to let them share their experiences with Point & Figure trading and to answer most of the questions that occur concerning the usage of the indicator (like which timeframes to use or which box sizes and reversal are best for which trading style and market).

New instructional videos are also in the creation right now, plus many basic and advanced informations on Point & Figure charts in general. And there will be a time limited trial version for everyone that is interested in buying this indicator soon, as this has been asked from some visitors.

Trading in July and August

I don’t remember everything what happend the last 2 months right now, because some time has already passed since then. But the trading the last weeks was kind of hard. No real trends have established and markets did range. I had to adjust my trading style to this and made some losses in the beginning. After that, I got more aggressive,  because I was not satisfied with the whole development of my trading account… not that the results are not good, so far. But I wish that I my account would already have made a steeper progress. To achieve this, I made some:

Changes in my $100.000 Challenge

I live in Germany and because of this, I decided to switch my trading account from Dollar to EUR. I have also switched my broker because the current one (Liteforex, see commercial at the top of this blog) doesn’t support EUR accounts. To keep up my trading history, I have decided not to only pay out my current balance, but to add as many Euro to it, until the amount is the same… I ended in August with $352, which I have payed out, and started a new trading account with 350 EUR. For this, I had to add another ~100 Euro…

So my new goal in this challenge will be to make 100.000 EUR. To speed things up a little bit, I also decided to add another 50 EUR each month from the next month on. I know that this is not the same as if I had started with $100 and made no addional payment, but it’s still a challenge to make some serious money out of small, monthly savings.

My new broker (ActivTrades) also offers some interesting CFDs, which I also started to trade – didn’t do well at first and lost ~16% in a few days. But I could recover soon and am currently at ~ 370 EUR now. To make my trading account more transparent, I have added some widgets from this great website, that I wand to recommend everyone: www.myfxbook.com

You can get live updates of my account wich are updated every 5 minutes. Plus, new trades and closed trades will automatically be send to my twitter-account. I have added this account on my website, too.

Any comments will be appreciated.

Starting with an account balance of 100 and trading it all the way up to 100,000!

I know that 100 is by far too less starting capital to trade for a living. But I will try to prove that it’s possible to start with only a small balance and grow it to a size where trading for a living is possible.

To achieve this goal, I will trade more aggressively than I would trade a bigger account. Loosing $100 is not a big deal and I could start again just the next week. But loosing 10.000 is something different and I wouldn’t trade such an account with equally high risk.

Under normal conditions I would open a position with a risk of 1%. For this trading challenge, I will put a risk of 2% – 7% per position with an average of 5%, depending on my gains. After some consecutive losses, I will lower my risk down to 2% and only increment the risk after some profitable trades.

How long will it take to make 100,000 out of 100? I don’t know.
Here are some weekly, monthly  and returns per year that are needed to achieve this goal in a given time:

I think a constant return of more than 100% per year isn’t very realistic, and even 50% – 80% won’t be easy. So the only solution for not having to wait 20 years to achieve my goal is to add up some capital in the beginning very fast and trade with higher risk.

Should I, for example, make it to 5.000 in 2 years, then it would “only” take another 7 years with a yearly return of 53% to get to 100,000. So this will be more of a long term approach and not a “getting-rich-in-1-year” adventure.

I started this challenge on 19th of January 2009. The broker I am using at the moment offers opening accounts in dollar cents and trading mini lots. So a 0.1 lot position means a win or loss of $0.01. Should I reach a decent account balance of $1.000 to $2.000, then I am going to change the account to a standard account with micro lots.

Update, 09/2009:
I have changed some rules of my challenge. The account was switched 1:1 from Dollars to Euro, that means $350 where withdrawn and a deposit of 350€ has been made on my new account. The broker offers mino lot trading, but is in real Euro now and not in cents as before.

Additionally, I will deposit another 50.00 EUR each month from now on – first additional payment will be made on 10/2009 to speed up the whole process a little bit