Student Loans For Trading
I was wondering if it's possible to take out a student loan to trade. Is it illegal if the loan is from a private institution? Is it illegal in general?
I'm about to transfer to a real university from a community college and I have to take out a loan anyways so might as well throw in a few grand to trade with no? I want to day trade equities but you need at least 30k which would impossible to get, I think, so I'll have to stick with futures/options. I already trade forex and I want to branch out.
And what are your thoughts on this statement: The odds are way better nowadays that you'll make more money from trading than a college education







I know of plenty of kids who
I know of plenty of kids who used student loans to fund spring break trips.
Go for it take out a margin
Go for it take out a margin account so you can play around with about 80K. If you think you can beat the market and are willing to use someone else's money then go for it. Worst case you just file bankruptcy everyone is doing it these days...Stay away from levered etf's though. when you take out margin and it turns into a 6/1 play they can move against you pretty quick.
TOJSHU: Go for it take out a
Go for it take out a margin account so you can play around with about 80K. If you think you can beat the market and are willing to use someone else's money then go for it. Worst case you just file bankruptcy everyone is doing it these days...Stay away from levered etf's though. when you take out margin and it turns into a 6/1 play they can move against you pretty quick.
Why are you encouraging him to destroy his credit rating?
I would advise not doing
I would advise not doing that. You say you trade Forex. Are you profitable with that? If you are, just use that money, but if you aren't, that's just another reason borrowing money to speculate is a bad idea.
"A man generally has two reasons for doing anything. One that sounds good, and the real one." - J.P. Morgan
Would you fund your trading
Would you fund your trading by charging it to your Mastercard or Visa? Your answer should be no.
Rule number one for beginners: Do not trade money you cant afford to lose. Just save up (1.5-2k should be enough) and set up your risk management before you trade. Make notes on every trade and write down what went wrong/great in that trade. Set an entry price, stop loss and when you should cash in before you hit the execution button. When I traded back in HS and college, there were a couple of times I thought my risk mgmt was too tight (seeing postions hit stop loss just to bounce back up). However, I cant count the times my stop limits have saved me from losing more than just a few dollars (think DNDN's crash Aug 3rd to Aug 4th).
Picking stocks isn't hard when your starting out. Being disciplined is the hard part. Better to have some cash on hand than hoping that your 610 entry in AAPL will bounce back up tomorrow.
CNBC sucks
"This financial crisis is worse than a divorce. I've lost all my money, but the wife is still here." - Client after getting blown up
Or he could take out a large
Or he could take out a large loan and put it into a regional band preferred stock BBT or USB, clipping a 6.5% dividend or so. These names are thought of as quite healthy. I think "day trading" is probably only really profitable for a small amount of people. It's gambling dude know everything about two or three names and play it like that is my advice.
Like said above never risk more than your willing to lose.
the odds are way better
the odds are way better nowadays that you'll make money from trading than a college education
GBS
I have traded futures and
I have traded futures and options before and I was profitable with that i just decided to put my money into forex, which I am also profitable in, because it was a lot more convenient with my scheduling. But I used the funds from my account to pay for all the apps and the deposits for the schools I applied to. I'm not gonna take out a 30k loan, i was thinking more on the lines of 1000-3000 so that way I can at least try all the products, except equities of course.
comment deleted
comment deleted
YOU JUST GOT TROLLED
http://www.troll.me/images/red-foreman322/dont-you...
What's the legality of this
What's the legality of this though?
Who are you going to believe, me or your lying eyes?
It's completely legal. You
It's completely legal. You just have to find a loan institution that will create an account or deposit for you (as opposed to direct deposit to your school account).
That being said, it is still a very risky idea. I would advise against it. You'll have plenty of time to trade when you're older and can risk your own money.
"History doesn't repeat itself, but it does rhyme."
This is just stupid... almost
This is just stupid... almost all retail accounts will lose $.
Trade when you have some savings that you can afford to lose.
Lemme sum this all up for
Lemme sum this all up for you... LEGAL = YES, SMART IDEA = NO.
But, do whatever you want.
I'll actually take the
I'll actually take the opposing view here and say go for it, but you have to be very disciplined.
DO NOT treat your student loans like a piggy bank. Figure out what you actually need to pay for school and take that amount + $2,500 ONCE. Give yourself one chance at this, because like others have pointed out - as a retail investor the odds are against you.
In the long run, if you work hard at investing this money and you have a general passion for it (possibly making trading a career one day) the experience alone will be worth $2,500. It would be great if you make money, but the odds are against you. I know you said you've had some previous experience trading, but really consider your risk profile and how much luck factored into your previous results.
It's also worth noting that student loans are not forgivable in bankruptcy so you WILL have to pay these back. Also, TODSHU is an idiot - don't follow his advice.
Frankly, if you are already
Frankly, if you are already taking out a sizeable amount for school it isn't necessarily the worst idea ever. Best case, you get a four year deferred loan to crush it in the market with. Worst case, it is just an extra bit of student loan debt you have to pay back. If you are taking out 50,000 for school anyway I don't think it is an awful idea to take out 5,000 extra to trade with. Don't treat it as play money, however, be serious about it. If you do it with good intentions and learn something from it I think it is part of the "education".
However, if your just taking out a ton of student loan money just to trade with I think that is a terribly stupid idea. As Accounting said, you basically can never discharge that. If your that much of a risk junkie just save up and go to the casino on the weekends.
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i would highly advise that
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I've been down this road so
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I know its a stupid idea. But
Gotta agree with the majority
Do it if you want but write
If expected returns are more
Key in that statement being
"History doesn't repeat itself, but it does rhyme."
historiclegend: If expected
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TOJSHU: Go for it take out a
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Louis Bacon.
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