Between yesterday and today I posted somewhere under $60 in net profits based on a gross profit of $165.03 less commissions. With IB my take would have been around $146... which is 240% higher than my return. The trades are only between 9 and 21 cents per contract so I need to consider increasing my capital to trade more contracts as well as decreasing my costs as I am not certain that there will be as many large profit trades going forward. The format we are using now, although a return to the original, has a twist. We are not holding ANYTHING over night or even into the later day. While that may change I cannot bank on it and therefore I need to consider that we may just be taking more smaller and incremental profits.
Having said that, Tuesday and Wednesday were not bad due partially to more trades and partially to some better gains. My concern is that many posted that they were able to make the $500, or close, gain for the day and there may be a move toward keeping to the lower profile format trades. This would not bode well for a smaller account like mine.
The IB route will help but is not going to happen until my current momentum trades are completed later in July and even that timing may depend upon what profits that are to be had from those trades still in progress. If they are not so great then I am going to have to build up cash with day trading first. Also, I cannot use less than $25,000 which is a benefit in and of itself.
So the plan now becomes one of consolidation of my capital. Taking my current trading and extrapolating the results based on possible cash transfer balances results in a relative increase of my profits once I take the switch to IB. That and applying the decreasing relative commission costs should give me a rough guide as to where I might expect to be.
As it stands I can double my cash by moving it into the margin account then work with those increased profits to create a larger base to move to IB faster even given the high commissions. This assumes that I take 100% losses on all of my current positions, just as a worst case scenario.
Seeing as we are not going to hold trades overnight I can eliminate the June 18th losses as they were expired contracts. This gives a better idea of where June may have been otherwise, then doubling my profits and applying the IB commission structure for a comparative purpose only. I dropped all the losers to a 20% loss to simulate the current plan...we are looking at about that for stop losses right now so it is about right even though some of the losers were from the prior month... I will remove those as well for realistic results.
TFSA with Questrade:
Profit = $4900
Monthly ROI to date = 38%
IB recalculated:
Profit = $6349
Monthly ROI to date = 49%
Questrade recalculated after consolidation at June startup figures:
Profit = $8183
Monthly ROI to date = 38%
IB recalculated after consolidation at June startup figures:
Profit = $10,602
Monthly ROI = 49%
IB recalculated using a $30,000 base for June startup:
(my minimum target deposit, which I will likely overshoot once profits are taken into account at the time of transfer)
Profit = $14,602
Monthly ROI to date = 49%
Well, taking the current TFSA recalculated June profits of $4900 and the IB based on $30,000 base of $14,602... or $8761 after worst case taxation, I am obviously ahead doing a full consolidation and transfer. Had I realized that IB was an option at the very beginning I would already be there and be seeing the results directly instead of having to wait for cash to become free in order to get this plan rolling along. I was too focused on the tax free implications and lost sight of the fact that there were other cheaper and better brokers for the plan that I was going to implement. Nothing against Questrade. They have been a very good first choice while I played with my small account balances to see where I would end up, something I could not have done with IB from the start anyway. April I could have switched but to be honest it was not the right time... now is.
Jeff.
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