 |
|
READER
QUESTION AT CTCR
Online
|
|
Question
on Silver Strategies
I just started
trading silver a few months ago. I knew nothing about
commodity trading before, but I thought I'd give it a
shot. I invested approximately $20,000 in 1,000 troy ounce
silver boullion in a margin account that gave me approximately
$80,000 leveraged funds. My equity was down to $15,000
when my trader suggested that I try to do a short transaction.
I did this to get a few thousand in profits by selling
long, so I could take the profit also when the price went
down. Meanwhile, I'm paying 11.65% interest on an account
where my equity is decreasing steadily. +AFw
Is this normal? Shouldn't my equity have increased when
I sold my silver? At what point should I be worried about
my decreasing equity? Can you share any data and trading
strategies for silver?
|
|
EDITOR-IN-CHIEF
COURTNEY SMITH'S ANSWER AT CTCR
Online
|
|
Editor-in-Chief
Courtney Smith: Stop
doing what you are doing now! Frankly, it sounds like
you are being ripped off. First, you should not be paying interest
on your account. Use futures instead. There is an implied interest
cost but it is less than 5% right now. Second, you've lost $65,000.
This is way too much to lose. It suggests that you do not have
the right methods and risk management. I suggest that you look
through this site for further insights into correcting this
problem. I particularly recommend that you buy our special theme
issue called "Why You Lose and What You Can Do About It". This
goes into detail on specific techniques that can help you. I
never recommend that people speculate without either letting
a professional do it or learning enough that they have a decent
shot of breaking even right from the very beginning.
|
|
