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Saturday, December 1, 2007

December has arrived: $500 Challenge Accounts

Ok, I have three rules for the $500 Challenge Accounts.

1) The initial investment is $500.00, to be split amongst the accounts. We did that back in October. $130 went to Sharebuilder for longer term investments, and $370 went to Xpresstrade for futures options purchases. Last month optionsXpress took over the last remaining accounts at Xpresstrade, so now the account that started with $370.00 is an optionsXpress account.

2) Every month, I can contribute $100.00, that can be split amongst the accounts however I choose. In other words, I can send $30.00 to Sharebuilder, $70.00 to optionsXpress; or $100.00 to optionsXpress, and nothing to Sharebuilder, etc. Last month I contributed the entire $100.00 to Xpresstrade (now optionsXpress). Thus raising our total to $130.28 (Dividend paid) in the Sharebuilder account, and $470.00 in the optionsXpress account. Now that we have arrived in a new month; December, and I'm thinking I'm going to contribute the entire $100.00 to the optionsXpress account again, bringing that balance to $570.00. I will be transfering $100.00 to that account on 12/20/2007. Which means it probably won't clear until about 12/26/2007, or so. Regardless there is still too little in each account to trade or even invest with, since I'm going after aggressive growth with these accounts but I don't want to lose what tiny amount is in those accounts. The commissions would eat me alive for what little shares I could purchase, and I can't trade the optionsXpress account for money management reasons. I want to build the optionsXpress account up to at least $700.00 (preferrably more) before I start trading that account. My accuracy rate is about 92%, and my risk / reward ratio is about 1:2.3. So it wouldn't make any sense to trade it before that time.

The Sharebuilder account will earn approximately 4.18% interest on the money that's in there 7 day yield, and there are no fees for either account.

That's the plan for now.

3) I'll be using regular investment and trade vehicles. Bonds. Stocks. ETF's. Futures Options. But not this month, for the reasons I listed above. Open-mouthed

Todays Sharebuilder Balance: $130.28
Todays optionsXpress Balance: $470.00


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This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment advisor, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The $500.00 challenge account is run for the education of other traders

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