Surely A Large Human
Date registered: Jun 2006
Vehicle: '08 C219
Location: Between Earth and Mars
Mentioned: 2 Post(s)
Quoted: 482 Post(s)
Working For Yourself
I'm hoping some of you can shoot some holes in this theory, because the quick math looked promising.
Let's say I have $25,000 of cash to play with, and I want to be a stock investor. I want to watch the market in something close to "real time", and have trades executed somewhat quickly (within a minute).
My goal is to work no more than 200 days a year, or 40 weeks, and to bring in $200,000 before taxes. That works out to making about $1,000 per day.
The first day, I would need to make 4% on my $25,000. If I wanted to "let it ride", the percentage return I'd need to clear would go down. Otherwise, I'd need to clear 4% every day.
In that income range, I'd be responsible for around 40% in taxes I'd suppose? Paying quarterly maybe, or maybe not, before deductions. So I'd need to be able to live on $120,000 a year "after taxes", minus 30% to go straight into savings for college, nest egg, etc. until a satisfactory level was reached.
Between simple buy/sell activity in a given day, and possibly some short positions, there are hundreds and hundreds of easy to spot opportunities for stocks moving 4% or more.
What am I missing, besides capital gains taxes which I don't understand a bit? How can this be tweaked to address risks not captured here?