How much money can you make off stocks?

by Keith

I want to invest in stocks but have no idea what stocks are or how they work or how much money can be made by investing and trading them.

Can somebody please put in simpliest terms what stocks are, and how much money can I make off them.

Comments for How much money can you make off stocks?

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How much money do successful small stock (day) traders make and do 90% of stock (day) traders lose money?
by: Mika

Info from my small unique book “The small stock trader”:

“The successful small stock trader (a retail stock trader with a stock trading capital of no more than a few hundred thousand dollars) may make about +50% yearly net performance on the long run, after 4-5 years experience and spending at least 20 hours a week on his indie stock trading/investing “small business”… for even after over 5 years of stock trading experience, working 30 hours a week, I barely meet my +5% monthly performance target in my active months, excluding the bear markets. I say “excluding” the bear markets, because while shorting the bear market sounds easy in theory, in practice it is not an easy thing, even for some great stock traders with decades of experience. So, during the bear markets your first goal should be to protect your stock trading capital…

Many studies claim that about 90 percent of the small stock traders eventually lose money and leave the stock market within their first year. Thus, only 1 out of 10 small stock traders survives to earn a consistent living in stock trading. The most important thing to remember is that the same winner often takes the gold year after year. This proves that stock trading is a skills game, one in which luck plays a small role… It is indeed rare for a small stock trader to consistently make over 5% a month, even if they work 70 hours a week. If you consistently make 100% annually, perhaps you will be one of the best stock traders in the world- and one like none I have ever heard of, though I have heard of a few derivatives traders who consistently make around 100% per annum. However, in the derivative market, the leverage can sometimes be 1:10, while in stock trading, the leverage for swing trading may be around 1:2.5.”

So, it is wise to be realistic and do not waste your little time, money, and skill/abilities on books/websites/newsletters/”gurus” that promise doubling/tripling your stock trading capital each year, for even the few great stock traders such as Jesse Livermore, Bernard Baruch, Gerald Loeb, Nicolas Darvas, William O’Neil, and Steve Cohen had an average annual return of +35-40 percent in the long run. However, generally speeking the larger your stock trading capital, the less your performance, as a small stock trader is more flexible, focused and simple than a big stock trader. Even Warren Buffet once admitted that he could make +50% each year on small caps if he had to manage a small stock investing capital.

I hope the above small article was a little helpful!

Mika (author of “The small stock trader”)
Unlimited Potential Gains
by: Kenny

Yep, most beginners that come into it dont have much idea how it works...all they want to know is how much can I make?

Once they have been in to it for a while they begin to think more about how much they could lose.

When you buy a 'share' in a stock, you are buying a share of the ownership of that company.

Pick the right stock to invest in and you could see some very high returns compared to leaving your money in a bank account.

In theory, the stock market offers seemingly unlimited potential profits just for the taking and those new traders thinking about how much the 'could make' are regularly taken to the cleaners.

Try a beginners trading course or virtual trading account to practice with to see how much you could actually make instead of how much you could potentially make.

You will also learn the cheaper way, how much you could lose.

Regards
Kenny

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