4 ms·

Seeing how well LinkedIn did, I am very tempted to try and daytrade these stocks, buying at release then selling about lunchtime. I'm only interested in trying

Seeing how well LinkedIn did, I am very tempted to try and daytrade these stocks, buying at release then selling about lunchtime. I'm only interested in trying it with about $200. This would be my first time trading. Does anyone know which service would be good for this? ETrade?

jonknee 15y ago
With $200 you will not have the ability to purchase shares at the IPO price (or if it's anything like LNKD anywhere near the IPO price).
radicaldreamer 15y ago
You can't really daytrade with $200, most brokers require at least $1000 to start an account. You'll also be limited to 4 or 5 roundtrips until you get dinged by an SEC rule that limits day trading to accounts with at least 25k equity and margin capabilities. Don't start trading with an IPO stock or anything that's bound to be volatile, it's just a bad idea in general.
- Lewisham 15y ago
  Bummer. My Get-Marginally-Richer-Very-Quickly scheme is ruined!
  - trotsky 15y ago
    It's really for the best. Trading like that it's much easier to end up on the wrong side of than it appears from the outside. Take that $200 and put it in a roth ira or similar - you 20 years from now will appreciate it.
    - nostromo 15y ago
      This is generally good advice, but I'd point out two things: 1) It's only $200. Even the most conservative investors will often put aside 5% or 10% of their portfolio for active investing. 2) 10 years ago, the S&P 500 was around $125 a share, and is now about $130. If we have another decade like that, $200 invested in the S&P 500 10 years ago will be a whopping $216 after being invested 20 years -- barely keeping ahead of inflation.
      - trotsky 15y ago
        I agree it's not always good advice, but I do think it's good advice for someone without investing experience and of limited means when they ask about day trading a stock on its IPO day. You can of course actively manage your investments in a roth just fine, but cap gains don't incur a tax liability.
      - jerf 15y ago
        This infographic is so good I just can't resist whipping it out every time it's even remotely related to the conversation: http://www.nytimes.com/interactive/2011/01/02/business/20110102-metrics-graphic.html http://www.nytimes.com/interactive/2011/01/02/business/20110...
        nostromo 15y ago
        Fantastic link, thanks! I'm amazed that money invested in 1928 was negative in real dollars if withdrawn in 2011. It's also interesting how devastating inflation can be -- notice how the great depression and the dot com bubble look mild compared to stagflation in the 1970s.
nikcub 15y ago
the easiest way is to find a CFD provider. It is like trading options with large leverage except that it is a contract with another party. CFD's are also a lot more expensive than the usual derivatives, but are a lot easier to trade and are a lot more accessible (you have two buttons to press and a chart) When you open an account, they will start you on a 2:1 or 10:1 margin, and over time you can have this increased. You will need to link a source of funds to the account, and they will ask you a lot of questions in setting up the account. You will likely blow the entire $200, but it will be a fun learning experience. The large trading firms out there have algorithms that look for trades just like the type that you will be making, and they intentionally shift the price around with large orders (that usually are not completed) in order to wip out your position. Google up about it and read as much as you can. It is a dirty industry - many affiliate marketers who make good money sending new users to one of the large trading sites, which can afford to make large affiliate payments because they make a ton of money on these trades. I have accounts with three different providers, and I get decent rates - but I opened the accounts ~10 years ago in one of the only jurisdictions where it was legal at the time, and had to lose a bit of money and establish a good relationship with them before they would give me a decent spread, interest rate, price, margin and access to some stocks etc. Chances are if you open an account now they won't give you access to LNKD or Zynga and only the top ~30 NYSE and NASDAQ stocks until you have some trading history. post-IPO isn't the best time because you have a lot of latent demand to enter the stock from indexed funds and others - so you might want to wait for it to settle I became disillusioned with it all since it is an insurmountable task. better to find stocks and companies you believe in and go long by buying them up on margin Edit: forgot to mention that minimum deposits are usually $10k, but that might be different now. there is currently no traditional options market for LNKD, but there will be soon tl;dr: google for CFD providers, game is rigged, watch out
MichaelApproved 15y ago
At best, it would cost you $7 to buy and $7 to sell in commission fees. That means $14 round trip or 7% of your initial investment just to break even. Respectfully, the above is a very basic concept. Not knowing that means you're new to investing. In that case, don't even think about day trading until you've had many years of investment experience. Even with that, people still get killed day trading.

jonknee 15y ago

With $200 you will not have the ability to purchase shares at the IPO price (or if it's anything like LNKD anywhere near the IPO price).

radicaldreamer 15y ago

You can't really daytrade with $200, most brokers require at least $1000 to start an account. You'll also be limited to 4 or 5 roundtrips until you get dinged by an SEC rule that limits day trading to accounts with at least 25k equity and margin capabilities. Don't start trading with an IPO stock or anything that's bound to be volatile, it's just a bad idea in general.

Lewisham 15y ago
Bummer. My Get-Marginally-Richer-Very-Quickly scheme is ruined!
- trotsky 15y ago
  It's really for the best. Trading like that it's much easier to end up on the wrong side of than it appears from the outside. Take that $200 and put it in a roth ira or similar - you 20 years from now will appreciate it.
  - nostromo 15y ago
    This is generally good advice, but I'd point out two things: 1) It's only $200. Even the most conservative investors will often put aside 5% or 10% of their portfolio for active investing. 2) 10 years ago, the S&P 500 was around $125 a share, and is now about $130. If we have another decade like that, $200 invested in the S&P 500 10 years ago will be a whopping $216 after being invested 20 years -- barely keeping ahead of inflation.
    - trotsky 15y ago
      I agree it's not always good advice, but I do think it's good advice for someone without investing experience and of limited means when they ask about day trading a stock on its IPO day. You can of course actively manage your investments in a roth just fine, but cap gains don't incur a tax liability.
    - jerf 15y ago
      This infographic is so good I just can't resist whipping it out every time it's even remotely related to the conversation: http://www.nytimes.com/interactive/2011/01/02/business/20110102-metrics-graphic.html http://www.nytimes.com/interactive/2011/01/02/business/20110...
      - nostromo 15y ago
        Fantastic link, thanks! I'm amazed that money invested in 1928 was negative in real dollars if withdrawn in 2011. It's also interesting how devastating inflation can be -- notice how the great depression and the dot com bubble look mild compared to stagflation in the 1970s.

nikcub 15y ago

the easiest way is to find a CFD provider. It is like trading options with large leverage except that it is a contract with another party. CFD's are also a lot more expensive than the usual derivatives, but are a lot easier to trade and are a lot more accessible (you have two buttons to press and a chart) When you open an account, they will start you on a 2:1 or 10:1 margin, and over time you can have this increased. You will need to link a source of funds to the account, and they will ask you a lot of questions in setting up the account. You will likely blow the entire $200, but it will be a fun learning experience. The large trading firms out there have algorithms that look for trades just like the type that you will be making, and they intentionally shift the price around with large orders (that usually are not completed) in order to wip out your position. Google up about it and read as much as you can. It is a dirty industry - many affiliate marketers who make good money sending new users to one of the large trading sites, which can afford to make large affiliate payments because they make a ton of money on these trades. I have accounts with three different providers, and I get decent rates - but I opened the accounts ~10 years ago in one of the only jurisdictions where it was legal at the time, and had to lose a bit of money and establish a good relationship with them before they would give me a decent spread, interest rate, price, margin and access to some stocks etc. Chances are if you open an account now they won't give you access to LNKD or Zynga and only the top ~30 NYSE and NASDAQ stocks until you have some trading history. post-IPO isn't the best time because you have a lot of latent demand to enter the stock from indexed funds and others - so you might want to wait for it to settle I became disillusioned with it all since it is an insurmountable task. better to find stocks and companies you believe in and go long by buying them up on margin Edit: forgot to mention that minimum deposits are usually $10k, but that might be different now. there is currently no traditional options market for LNKD, but there will be soon tl;dr: google for CFD providers, game is rigged, watch out

MichaelApproved 15y ago

At best, it would cost you $7 to buy and $7 to sell in commission fees. That means $14 round trip or 7% of your initial investment just to break even. Respectfully, the above is a very basic concept. Not knowing that means you're new to investing. In that case, don't even think about day trading until you've had many years of investment experience. Even with that, people still get killed day trading.