In the USA, the CARES Act allows you to withdraw up to $100,000 out of your 401k, if your paycheck has in anyway been affected by the pandemic. You have until December 31st 2020 to do this, if your plan is participating in the CARES Act.
I decided to put $10,000 into Tesla stock. Then another 10k, then another 10k, then a few odd dollars to make it an even 75 shares. I think I had a total of about $31,300 invested.
I thought it would be funny to buy at $420.20, because, 420 for Elon Musk, and *20.20 for the year.
You might be looking at Tesla's closing price yesterday, of $695, multiplying that by 75 shares and slapping me virtually on the back and congratulating me for gaining almost $21k in only 7 weeks of investing, but.....I am not THAT lucky.
My intention was to INVEST, long term. But the 2nd deposit of $10k caused some issues. I transferred the funds to my bank, waited 2 days, bank said funds were available, transferred to my brokerage account with Charles Schwab, waited another day or two for the transfer to be final, and the funds available.
Easy peasy, although not the most efficient means of moving money from one institution to another and then on to the 3rd. For some reason, the 2nd deposit got recalled, for non sufficient funds. AFTER I spent it on Tesla stock. So now my brokerage account is frozen, can't buy, can't transfer. After several calls and much confusion, they finally said I had to sell everything, since technically I bought stock with their credit.
So I sold all the stock, got my account unfrozen, and started buying all over again. I profited $2550 from that disaster. And now it is early November, SP500 has already announced the inclusion of Tesla, so the price just keeps going up and up, and I have to start all over buying it again, but then
Hmmm, I wanted to be a long term investor, but, TSLA was trading plus/minus $40 a day, so I took a chance with just $11k, bought some shares, then sold them the same week. I profited $800. WOW! Let's do that again!
But by this time the stock REALLY started taking off, and stalled at $650, and I was poised to snatch some shares on the next decline. Which happened, and I dumped all $34,350 into the stock last week.
So far I had been quite lucky, but the price actually dropped below what I paid, for several days, and the inclusion into the SP500 was getting closer and closer, and I was still in the red. I was getting a bit panicked. But then, yesterday it was all over the place in price, and I sold with one minute to spare, for a profit of $2100.
I was furious when the check bounced and I had to sell and start over, but if it had not, I would never have gotten the courage to do frequent trading.
$5450 for 7 weeks. I think I like this short term trading stuff, even after the taxes.
I see many cheap stocks that move up/down/up/down every day by 20 to 50 cents. I could get 3400 shares of $10 stocks, sell for $0.20 higher a few days later, and make $680 a week or more. It just seems too easy to make money this way. I could be making up to $175,000 income in just one year if luck holds. So....Other than the obvious financial risk of frequent trading, are there any legalities I need to be aware of? Do they limit this sort of thing?
Edit---23DEC2020: Monday the 21st, invested (gambled?) about $9300 in 3 separate petroleum companies. Sold them today, the 23rd. Add $550 to my coffers. Running total is now an even $6000. The hardest part of all this is SPENDING all the money on new stocks. Once I get them at the price I think to be rather good, getting rid of them is much easier. There is always 12k-20k $$ sitting there (except when I was all in on TSLA most recently), in reserve due to having open orders.
To be honest, I am DOWN on 3 stocks, for a total of about $700 (out of about $6000 invested), but that is not a loss unless I sell them at the down price. Two of the 3 would be good long term investments if I get stuck with them for a while.