Also, just because you earned 20% in a day, doesn't mean that this will hold true in the long-run. You were lucky. That happens a lot. A penny stock jumps 20-30c. Happens, but not everyday, and not consistently.
Once the luck runs dry, and you fail, everything comes crashing down on you, since the losses change you psychologically. Penny stocks are vulnerable to spontaneous news, and trader sentiment.
I suggest you keep at it for at least another few months, and include commissions fees (just use the fee you would be charged at the brokerage of your choice). If you can get 70% or more good trades, then try it out.
Flat fees work best for large numbers of shares, so, penny trading is great, but, once you want to trade the more expensive companies, or with lesser numbers of shares, flat fees don't work as well.
However, with penny shares, if you make the wrong call, they can drop a lot as well, which can cause large losses. Penny stocks move slowly most of the time, which cause you to be unsure of its true direction, and, since you want to offset your commissions fees, you hold onto the position, hoping it will gain, just to suddenly see it fail.
Even with 1c/share commissions, you need to sacrifice 2c gain. My Canadian brokerage gives 1c/share commissions, that cap off at around $7, which is still less than the cheaper American brokerages.
There is honestly no difference between a penny stock and an expensive stock, as long as the payout is scaled proportionally. That is to say, if a penny stock moves 10c usually, and a $30 stock moves, say, 50c, it will be proportionally the same, albeit with more security from the expensive company.
Who knows, but with only a month of experience your chance of being a "good" trader is slim to none and based on your experience you'll never make it as a day trader.
Trading on a simulator is not the same as trading in the real world, and using penny stock on a simulator is a total waste of time and effort. There is no simimulator that can duplicate the penny stock market, since in the real world penny stocks do not trade in a regulated market.
To be a day trader you must first know how to trade and in order to trade you must know how to invest. To day trade you need several years experience as a trader. You must know the products and the markets in which they trade, how security transactions are cleared and more importantly you must know the rules that govern those products and markets. So you must know what you’re doing, why you’re doing it, and how to do it.
With only a month or so on a simulator and using penny stocks there's no way you have benefited from your activity.
I think you should look at trading realistically with a more mature attitude, - youre not there yet.
Simulators are completely unrealistic for penny stocks. They allow you to make trades that are not possible in the real world. An earlier answer correctly pointed out commissions as another issue.
Consider a stock toggling between bid (.0001) and ask (.0002). The simulator will let you buy at the bid price and sell at the ask price. In the real world, that is not going to happen.
There are lots of ways to make money on penny stocks, you just need to find the right guidance and community. You can't talk about penny stocks without mentioning Timothy Sykes. Join http://profit.ly/plans?aff=4544 for free or a paid one, your choice. I joined the free version because I don't need the in depth features. You become a transparent trader and learn with the community. Check it out and if you want to learn stocks, join Tim Sykes and get one of his plans, if you like large cap stocks, one of the other gurus can help accelerate your learning and teach you to trade. Tim is the master of penny stocks though. You'll learn how to short and make money on the dumps.
I bought superman's subscription. He trades everything from small to large cap as as well as options. I'm thinking of going to Tim since he mainly focuses on penny stocks and his subscription is cheaper. http://profit.ly/guru?aff=4544
More people meed to become transparent traders instead of randoms talking like they know something without backing it up. Check out the site, join, become transparent, subscribe to a guru if you like. This is the site for all traders.
Thank you Mochibot. I'll keep virtual trading for another month or two and read up on successful strategies until I can perfect my own strategy. I'll try to aim for a higher success rate each month.
You will do fine as long as you are fast enough. You will be competing against computers that analyze a situation and make a trade in a few milliseconds - soon to be microseconds. Good luck. You will need it.
why not?
I've taken an interest in stock trading and for the past month i've been using the paper money application to practice, so far i've made $1000 a week off of $5000. I've even made $1000 in a single day! I day trade penny stocks, following the current chart and when I see that the stock has reached a stable point when it rises and falls by one cent I buy it low and sell it high, often making $190 per trade. I've been pretty successful and i'm willing to open an account with $3000. How do you think i'll do?
