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Going for broke

  • #1
  • First Post: Jun 22, 2008 3:17pm Jun 22, 2008 3:17pm
It's an unsaid thing around here.... how capitalized each FF member is.....

Are you that starving college student? That retired CTO playing golf everyday?

The point is, when you don't have much money, its a long shot that you will hit it big with forex. Those of us (young professionals like myself) have to decide.... put extra money away for retirement (the safe bet) or gamble it into the forex markets and hope to hit it big.

You know, one of those 20 or 30 somethings that retired early. It's a canundrum.
  • #2
  • Jun 22, 2008 3:29pm Jun 22, 2008 3:29pm
Quoting tdion
put extra money away for retirement (the safe bet) or gamble it into the forex markets and hope to hit it big.
Never put all of your eggs in one basket.
Not all sins are created equal
  • #3
  • Jun 22, 2008 3:40pm Jun 22, 2008 3:40pm
Controlled risk isn't gambling. Gambling is gambling.
  • #4
  • Jun 22, 2008 4:29pm Jun 22, 2008 4:29pm
Quoting tdion
Those of us (young professionals like myself) have to decide.... put extra money away for retirement (the safe bet) or gamble it into the forex markets and hope to hit it big.
You have more choices than forex or a retirement fund.
How about real estate?
If I was 30 that's where my money would be going. You can buy condos, small unit apartment complexes and residential property for 30 cents on the $, right now.
  • #5
  • Jun 22, 2008 4:29pm Jun 22, 2008 4:29pm
You guys see the problem though?

Compounding gives the little guy a puncher's change of a knockout....

So there is the temptation.... repeatedly risk money in order to have a lucky strike....

Of course, high leverage compounding can put you in the poor house (well, you were there anyway, lol)
  • #6
  • Jun 22, 2008 4:32pm Jun 22, 2008 4:32pm
Hey bill

i'll tell you what i think....

real estate can continue to go down.... i am not anti-dollar, but being a realist, i believe we can go into another great depression...

sure you can buy investment properties, but then you are spreading yourself extra thin.... being responsible for multiple mortgage payments.... plus answering to "my water heater is broken" "my air conditioner broke" etc etc

the problem with multiple mortgages is that you are married to them....

Quoting billbss
You have more choices than forex or a retirement fund.
How about real estate?
If I was 30 that's where my money would be going. You can buy condos, small unit apartment complexes and residential property for 30 cents on the $, right now.
  • #7
  • Jun 22, 2008 4:42pm Jun 22, 2008 4:42pm
imo, going broke involves being greedy and stupid. Whether forex involves either is more of a personal assessment than a statement...

However, I don't see forex as a ticket to "hit it big". I like forex for the same reason i like strategy games: the challenge. I love to be the best, but most of all, i like problem solving. And even as a "young professional", the money i put into forex isn't designated as "savings" or "retirement", it's play money with a positive net return. And as long as you're doing it right, you put money in once and let it grow. If you're continually paying "tuition", you might just want to demo until the choice isn't between retirement and forex.

Quote
The point is, when you don't have much money, its a long shot that you will hit it big with forex
And chances increase the more money you have? Perhaps you're thinking in $ amounts. If you're aiming for that $1 billion trade, more power to you. Personally, I aim for 5% a week. And all i know is that that 5% will continually be 5%, whether my account is $10 or $100k.

Most fortunes are not made overnight. It's slow and steady. And the only advice i give people when they want to know how to make money is to "be friends with rich people". IMO, they do think differently and they obviously know how to make money.
  • #8
  • Jun 22, 2008 4:42pm Jun 22, 2008 4:42pm
Quoting tdion
Hey bill

i'll tell you what i think....

real estate can continue to go down.... i am not anti-dollar, but being a realist, i believe we can go into another great depression...

sure you can buy investment properties, but then you are spreading yourself extra thin.... being responsible for multiple mortgage payments.... plus answering to "my water heater is broken" "my air conditioner broke" etc etc

the problem with multiple mortgages is that you are married to them....
If it rental property (the only kind I would buy) you'll have income from your rentals. You're right though. It is a risk. Its also a lot of work. You can't sit home and do it like you can forex.
  • #9
  • Jun 22, 2008 4:46pm Jun 22, 2008 4:46pm
Right, but that's exactly the point. Are you trading forex to get rich quick, or to develop a trading skillset that you can use when you have significant capital to make percentage/month that can be used as residual income?

Should be the latter imo.
Anything you make on small account sizes should either be compounded or considered pocket change.
  • #10
  • Jun 22, 2008 4:47pm Jun 22, 2008 4:47pm
About real estate...

I'd rather invest when everyone gets excited about the economy again. Whether we go into another depression or not, people with the money will wait it out until it's safe. Just like forex, trying to predicting the market will kill you. I'm going to get in when the trend starts to turn around. Either way, i will be buying on a huge discount. If you buy now and the recession lasts for another year (end of presidential term), you will be holding onto the property while the mortgage payments suck you dry. Unless you're lucky and you find a buyer or a renter.
  • #11
  • Jun 22, 2008 4:50pm Jun 22, 2008 4:50pm
the real estate market is what it is.... impossible to call the bottom....
  • #12
  • Jun 22, 2008 4:51pm Jun 22, 2008 4:51pm
Real Estate is a nice investment.
I get around 8.7% from rental alone. And on the other hand you have
the ROI from increasing property prices.
Of course you have to put away some of that money for maintainance.
Still a good investment.

What I like the most is that you can actually touch and see your money at work.
And you're offering a place to live for other people. So there is a social part aswell.
  • #13
  • Jun 22, 2008 5:03pm Jun 22, 2008 5:03pm
Quoting tdion
the real estate market is what it is.... impossible to call the bottom....
You don't need to call the bottom.
If you're thinking to buy property and holding it in hopes it will go up, I agree. Its no differnt than taking out long term positions in forex.
That's not what I'm talking about though.

Right now single family dwellings are going cheap. You can pick up foreclosures for very low prices.

Find one cheap in a neighborhood that has a few rental houses in it.

Rent your's out. Price of rented property is based upon how much income it generates- period.

Fix the house up and raise the rent when the 6 mos lease is up.

Then sell it.

That way you aren't concerned about the long term price future of real estate.


I did that back in the early 70s and made a lot of money. The only mistake I made was not keeping on.

As I said, the drawback is that it's work. If you have more than one or two places, you'll be messing with them every weekend.
  • #14
  • Jun 22, 2008 5:04pm Jun 22, 2008 5:04pm
Quoting Tjpld
Real Estate is a nice investment.
I get around 8.7% from rental alone. And on the other hand you have
the ROI from increasing property prices.
Of course you have to put away some of that money for maintainance.
Still a good investment.

What I like the most is that you can actually touch and see your money at work.
And you're offering a place to live for other people. So there is a social part aswell.
Lol yes you're such a philanthropist.

Real estate is great if you have the money, however tdion is right. It's impossible to call bottoms and it's a close to permanent investment. There are other forms of investment (such as forex) with much quicker results (whether its a loss or a gain)...with imo the same ammount of risk (falling real estate prices vs broker tricks, etc)

Though the main issue is that trading is a skillset. It's not a matter of building your account up as quickly as possible, it's a process of refining your skills so when you have enough money in your account the percentage win's will be consistant, profitable, and enough to support your daily life.
  • #15
  • Jun 22, 2008 5:07pm Jun 22, 2008 5:07pm
Quoting billbss
You don't need to call the bottom.
If you're thinking to buy property and holding it in hopes it will go up, I agree. Its no differnt than taking out long term positions in forex.
That's not what I'm talking about though.

Right now single family dwellings are going cheap. You can pick up foreclosures for very low prices.

Find one cheap in a neighborhood that has a few rental houses in it.

Rent your's out. Price of rented property is based upon how much income it generates- period.

Fix the house up and raise the rent when the 6 mos lease is up.

Then sell it.

That way you aren't concerned about the long term price future of real estate.


I did that back in the early 70s and made a lot of money. The only mistake I made was not keeping on.

As I said, the drawback is that it's work. If you have more than one or two places, you'll be messing with them every weekend.
When you say keeping on, you mean continuing the process?
Also, why were your lease terms so short?
  • #16
  • Jun 22, 2008 5:08pm Jun 22, 2008 5:08pm
Quoting Tjpld
Real Estate is a nice investment.
I get around 8.7% from rental alone. And on the other hand you have
the ROI from increasing property prices.
Of course you have to put away some of that money for maintainance.
Still a good investment.

What I like the most is that you can actually touch and see your money at work.
And you're offering a place to live for other people. So there is a social part aswell.
PS: No offense on my comment to you, only poking some fun
  • #17
  • Jun 22, 2008 5:15pm Jun 22, 2008 5:15pm
Quoting renegade7
When you say keeping on, you mean continuing the process?
Also, why were your lease terms so short?
Yes. I stopped doing it after a couple of years. I had a good job and had gotten promoted while I was doing it. They made me move. I closed everything out and never did it again.

The lease terms were short because I wanted to raise the rent as soon as I could. I couldn't do it in the middle of an existing lease.
Raising the rent is the key to making money with this. Not for the additional income, but to increase the value of the property.
  • #18
  • Jun 22, 2008 5:19pm Jun 22, 2008 5:19pm
you make sense.... though it seems it comes down to being a cut-throat business man with no regard for the tenants.... many folks just can't afford a rent increase

it's neither here nor there.... i understand your point of view.... it is the capitalist way of doing things.... i guess i just wouldn't have it in me to raise rent on people barely making their ends meet.

Quoting billbss
Yes. I stopped doing it after a couple of years. I had a good job and had gotten promoted while I was doing it. They made me move. I closed everything out and never did it again.

The lease terms were short because I wanted to raise the rent as soon as I could. I couldn't do it in the middle of an existing lease.
Raising the rent is the key to making money with this. Not for the additional income, but to increase the value of the property.
  • #19
  • Jun 22, 2008 5:20pm Jun 22, 2008 5:20pm
Quoting billbss
Yes. I stopped doing it after a couple of years. I had a good job and had gotten promoted while I was doing it. They made me move. I closed everything out and never did it again.

The lease terms were short because I wanted to raise the rent as soon as I could. I couldn't do it in the middle of an existing lease.
Raising the rent is the key to making money with this. Not for the additional income, but to increase the value of the property.
Interesting.
Did you find you were limited by neighboring properties and their rent pricing, or was your property "well worth it" on the interior, etc.
How exactly did it "raise the value" with comparitive housing in the area for possibly much less?
  • #20
  • Jun 22, 2008 5:22pm Jun 22, 2008 5:22pm
Quoting tdion
you make sense.... though it seems it comes down to being a cut-throat business man with no regard for the tenants.... many folks just can't afford a rent increase

it's neither here nor there.... i understand your point of view.... it is the capitalist way of doing things.... i guess i just wouldn't have it in me to raise rent on people barely making their ends meet.
True, but as a renter you know that if you have a steal of a price to sign for a long term. 6months is VERY short, and I doubt anyone "barely making ends meat" would sign something like that when you factor in the price of moving, work location, etc.
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