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4 Reasons why you should start with a R5,000 portfolio

by , 19 June 2019
4 Reasons why you should start  with a R5,000 portfolio
Q. "I would like to know if it's wise to start trading with capital of R10,000? I am a beginner and have never traded before?"

A. I always recommend a starting portfolio value of at least R5,000, when you start to trade.

Not only will you be able to grow your account larger and at a faster rate, but also because of these four main reasons.
Reason #1: More funds mean more trades you can take
You'll have enough funds to take on a number of trades, at any one time.   
This way you'll be able to hedge (balance) your trading positions in case one or two of them don't go your way.
Reason #2: Curb any potential trading costs
You'll always need additional capital to make up for any hidden trading costs that your broker will charge, whenever you take a trade.
These costs include the: spread between the bid (buying price) and the offer (selling price), the brokerage you’ll pay to buy and sell a trade, the platform fees to gain access to live streaming data, and even the interest costs that you'll pay while holding onto overnight positions. 
Reason #3: Peace of mind
In short, the more money you deposit, the safer your portfolio will be against any big losses.  
Just like a plane needs to fly at a high altitude to avoid crashing into buildings, structures and even birds, so too will you need the extra capital (height) to avoid the unnecessary dangers of getting hit by a large and an unexpected loss due to an external event.  
Reason #4: Diversification 
With more funds in your trading account, you can use the money to take on a number of different trades from different trading strategies and trader services (such as Red Hot Storm Trader and Pickpocket trader). 
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Q. "Timon, as a person who has never traded before, why do you think it is important for guys like us to join your Red Hot Storm Trader service?" 
A. I believe it is a pivotal step to initially join a winning and a proven trader service like Red Hot Storm Trader as you'll be able to cut the steep learning curve of understanding how to trade, what money management principles are best to use and understand how other successful traders make their income on a weekly basis.
“Wisdom yields Wealth”
Timon Rossolimos,
Analyst, Red Hot Storm Trader
P.S: Got a trading question or feedback you'd like to share? Then ask here at our exclusive Facebook group with over 52,000 aspiring traders

4 Reasons why you should start with a R5,000 portfolio
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