How To Buy A Coffee With A Single Stock Trade In 10 Minutes

I’ll admit, I struggled with the title for this post. Mainly because it puts a lot of pressure on me. As I write this, I’m just at the start of the strategy. That said, I have full faith in the strategy, and wanted to give myself something to push me forward. The strategy that I’m talking about is trading stocks (surprise) with Robinhood.io. Why Robinhood?

Free commissions.

Moo, bitches...

Say what?

That’s right. Free commissions. I’ve talked about Robinhood.io before, but it wasn’t until this week that I was able to finally trade with the app, because it took them this long to get an Android app put together. I invested $10 to test it out. That’s where the title of this post comes in. My goal isn’t to make millions, it’s to trade enough in a single trade to buy myself a cup of coffee.

My coffee costs $2.80.

So there we have it, I have to trade 28% of my original $10 in a single trade. Will I do that in a single trade? Hell no. It’s going to take some build up. And in fact, I’ve actually already been working on that.

I deposited my initial $10 on August 18th, 2015. Today is August 26th, 2015 as I write this. My portfolio sits at $10.72. For those keeping track at home that’s a 7.2% of the original invested amount. And I’ve even lost money on a trade. Once. Just once.

So what’s my strategy? It’s actually really simple. Small gains. I head over to Yahoo Finance or Capital One Investing (Previously Sharebuilder) and look for penny stocks that are showing high fluctuations for the day. I want them to be pretty consistent spikes, or at least trending one direction or the other. Once I know the trend, I aim to buy at the low end of the spike, and sell at the¬†middle of the spike.

Why the middle?

I don’t want to risk too much, so I put a limit sell order on the middle price, and then I watch. I do the middle because it let’s me change the price if I think it’s skyrocketing again, but it also let’s me have a point to hold out for if the spike is slow. You see, I want to be in and out of a stock within a few minutes. I don’t want to hold for an hour or two. That’s too risky. I want to be able to pick it up at $0.40/share, and sell it at $0.425/share within a few minutes.

I’ve made some decent trades this way. Once I make a profit, I buy more stock. This let’s me compound the benefit. The plan is to cash out once I hit $20, which will let me risk as much or as little as I want, because at that point my initial investment, my cash capital, is out of harms way. I will only ever break even at that point. Thus, I can’t lose.

Yea, yea, but what about the Coffee?

My average profit on a trade is 6.5%, which means to make the $2.80 in a single trade, I will then surpass my $20 goal, and be able to cash out. Do I think that’s going to happen soon? Who knows. You’re only as profitable as your last trade.

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Robinhood – A New Trading Platform

So a friend of mine sent me a link today for a new trading platform called Robinhood. I’m a skeptic, but I thought I’d detail a bit of what it’s supposed to be here. Commission free stock trading. They don’t really have a clear explanation on how they’ll make their money without commissions, but they’re venture funded by Google and others, so I’m giving them a bit of leeway there.

I signed up to become one of the first adopters, and I’m hoping to get my link before long. If you’re interested, sign up yourself. I’m not going to be putting much faith in them until I see for myself what to expect. I’ll probably gamble $100 on trades.

I emailed their support email an hour ago, but haven’t heard back yet. I’m looking to find out if they’re going to support automatic investing like ShareBuilder does, which would be one in their favor. If they do, then my previous posts about 3 months to profit would not be required at all, since they’re all about limiting the commission fees.

They’re working currently on implementing Margin trading, which I would never use because I find it insanely risky. I’m a much more conservative investor. I like to have my money work steadily for me, not do crazy shit and expect it’s going to come back rich.

Happen to know about Robinhood? Leave your knowledge in the comments so we can all bask in the glory that is your hubris.