I will point out that this isn't necessarily new, I just wanted to figure it out for myself and my exact situation (I learn best that way). I know there are references in other posts to similar scripts (maybe even ones that do the exact same). If there is one out there, please don't assume this is plagiarized 🙂

Hi all, I am feeling quite dejected, foolish, and let down. I have spent a couple of thousand on learning to day trade, and I have only just realised that the financial bar to entry is far higher than I had anticipated. First, a bit of background. I have been trading in the DAS sim for 4 months now, and doing pretty well. I started with a $1000 dollar account as this is what I could afford for a live account (fortunately what I can afford has increased since then). I have been growing my demo account consistently by 1 to 2 % every day. My plan was to use Capital Markets Elite Group as my broker to escape the PDT rule. I am non-US based. I have been logging and reviewing my trades thoroughly, as suggested by the BBT community. However, I misinterpreted the CMEG commission rates on trades... I thought that it was $2.95 per trade, which is only paid when opening the position. I thought partials and closing trades did not incur costs. I was doing well using this fee structure. However, after watching Carlos's video on CMEG fees (https://www.youtube.com/watch?v=yoKpnFiagzE) I now know that I was way, way, way off. Every 'ticket' incurs the $2.95 fee. So entering, partials, and closing the trades also incurs the fee. My trading style involves opening a trade, and then quickly scaling out (sometimes 5 or 6 partials), and often leaving a runner share size on. I can quite comfortably make my 1% a day doing this if it is $2.95 per trade. However, considering that I am currently only going for less than $30 per day, if I use the REAL fee structure, then entering a trade, taking 5 partials and closing out will cost $20.65 in commissions?!?!?!? Hopefully I am wrong and someone can call me silly for feeling dejected because this is not how it works. Otherwise, can someone please enlighten me as to how it is possible to be profitable in a small account with CMEG? I watched a video recently where Mike B said that he aims for $50 a day BEFORE commissions. I assume after commissions he wont have much left if he is using CMEG. I know that Carlos uses CMEG, would be interested to know how he gets around the ridiculously extortionate fee structure and is able to make a living out of trading? Perhaps it's impossible to scalp and take partials on a small account with CMEG? And instead a new approach is needed where you enter, let it move in your direction, and close, without taking partials; otherwise your profits will have been eaten up. Thanks in advance!

Hi there, As far as I understand from your post, you may have misunderstood some things about risk management. And that's totally fine, considering that when you start doing this there's a thousand new bits of information coming at you every day. Long story short, the theory is not that you shouldn't SPEND more than 2% per trade, but rather that you shouldn't RISK more than 2% per trade. Let's take an actual example: You have 25K so 2% of that is $500 risk. Say you want to long a stock at a price of $10 and you put your stop loss at 9.50$. This means that you risk $0.50 per share, and given that your max loss per trade is $500 (2% of your account), then the calculation you have to make to decide how many shares you can buy is 500/0.50=1000 shares. Now, one thing I'd add is that, in my humble opinion, risking 2% of your account per trade is way too much, particularly when you're just starting out. Think about it, merely 10 losing trades and your account is already 20% down. I would consider the option of only risking a fraction of 1% because risking too much per trade can throw your psychology off balance in the middle of a trade and make you focus more on potential losses that you aren't comfortable with rather than the proper trade management that you need to produce consistent results. Hope this helps 🙂 Vlad

Just to expand on what's been said before. The discounted commission rate with CMEG is at 0.004 per share with a minimum of 50c per 'ticket'. If you trade a stock and get 125 shares - that would be the optimum no. of shares (125 x 0.004 = 50c). So, if you are taking 125 shares or less, you pay 50c for every entry, partial, exit, etc. If you are taking more than 125, then you start to pay a bit more - e.g. if you open a trade with 250shares, that's $1 right away. I also have a low balance (4-5K), and commission suck, especially if you find yourself a bit down and are then overtrading to make it back. I have found times where I would break even on Gross, but then face a $30 commission/ECN/sec fees. One tip.. Don't trade stocks where the price is very low and you have a tight stop - you may be risking $25, but you are taking 1000 shares right away (you're already $4 down on the trade). I prefer to play higher prices stocks that move by larger dollar amounts, you take a significant amount of lower shares. On the flip side, I don't trade things like $AMZN where it's 3k per share.. maybe you take 3 or 4 shares, and how are you going to partial out? I prefer to trade $50 - $500 normally (although I do trade $TSLA and $NVDA at time too 😉 ) Hope that helps.