Can I Start Trading With $100?

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If you’re looking to invest in the financial markets, day trading is the way to go. Unlike a standard investment where you see how your money grows for an extended period, this one lets you open and close your trades in a single day.

As the name suggests, day trades are limited to within the day and aren’t held overnight. Thus, it means choosing assets that are likely to go through short-term price fluctuations, such as stocks, commodities, cryptocurrencies, and more. You can learn more about day trading binary options at InvestManiacs.

There are lots of reasons to not want to put tons of money on a trade. Thus, you probably want to know if you can start trading with an amount as little as $100.

Is It Possible to Day Trade With Just $100?

Generally speaking, you can definitely day trade with just $100. However, this would also depend on the firm you’re partnering with and the strategy you’re looking to implement.

Most of the time, the broker decides what the start capital is. The amount also isn’t something you should argue with them about. After all, it aligns with the strategies they provide. It may prove too difficult to map out a profitable course of action with such a low amount, and you have to accept that.

When $100 does work for a specific plan, you can trust that the plan has undergone thorough research and strict risk assessment.

Day Trading With a Hundred Bucks in Four Steps

Follow these steps to day trade successfully and with efficiency:

Step 1: Team Up With a Brokerage Firm

With a start capital of $100, it’s important to find a broker to agree with on the following things:

  • Minimum deposit. Naturally, if the firm’s minimum deposit exceeds $100, you won’t be able to work with it.
  • Charges. As much as possible, charges should be spread instead of on commission. There’s usually a minimum charge for a commission-based strategy, which triggers minimum charges per trade.

A spread fee, on the other hand, is treated as a built-in cost and charges based on the trade amount. That makes it a cheaper and relatively better alternative.

  • Leverage and Margin. Trading on margin with leverage for $100 trades lets you realize reasonable earnings. You get a maximum 50:1 ratio in the US and a 30:1 ratio in Europe, which are good enough conditions to trade in. Make sure your broker provides a ratio that lets you profit from a $100 initial investment.

Step 2: Select Securities

It would do you well to aim for higher gains in the case of a $100 start capital. Your account might not experience much growth if that isn’t one of your priorities.

Securities that are more volatile will help achieve higher gains. Among the most volatile in the world is the currency market. That’s why you’ll want to invest your $100 in currency pairs more than in any other asset.

If you speculate correctly, that small amount could translate to some incredibly good returns. In particular, you’ll want to stick with the popular forex pairs that come with low costs and fees. You’re not investing much, so it would be best to keep those additional charges at a minimum.

Step 3: Come Up With the Right Strategy

It is more crucial than ever to get your strategy right since your initial amount is so low. To do this, you must consider the timing and amount of each trade carefully. On top of that, there should be risk management and exit strategies in place to ensure minimal loss.

Research is crucial for coming up with the correct strategy. Look to partner with a solid platform with a low minimum initial deposit and trade amount, diverse assets, and add-on features. These are qualities you can leverage using your small investment.

In case you have trouble mapping out a profitable blueprint, try participating in an active forum for traders or registering for alerts and notifications from active traders.

Step 4: Begin Trading

Now that you’re done with steps one to three, it’s time to create your account. Select the account type that lets you day trade with $100. For most broker sites, that would translate to a basic account. Submit the firm’s requirements, including personal details, and wait for the email confirmation.

It’s standard procedure in these scenarios to confirm your identity, so you might be asked to provide income information. Though, chances are you may forgo providing this piece of data since your starting capital is only $100.

Start Day Trading Today!

An inexperienced trader may find day trading incredibly stressful. Aside from not knowing much about what you’re getting into, you worry about possibly losing your money from a bad hand. Thus, you may not want to put anything more than $100 on a trade. Well, that’s perfectly possible and, even better, can still earn you some decent profits when done right.