I may only be a teenager, but I want to start investing. I've been looking around seeing what I could do to turn a few little dollars into twice its value. I've wanted to just wait for the value of mtgoxCAD to go down then to just buy buy buy, then sell it all when it gets expensive, but then I saw mining contracts and just mining Bitcoins myself. If I were to go with this
contract, and I used the 500MHash for 9 dollars I would only be getting 10 dollars from it at current mtgoxUSD rates.
I'm still curious about other options.Now my question is, what do you guys think would be a viable plan to make some small change from Bitcoin?
Here's the method I've used that has helped me make 700% profit on a $100 investment since about June 20th. That's right...700% profit using a SAFE strategy since the bubble burst.
I took $100 when TradeHill was still accepting Dwolla (you will need a new deposit method at this point) and deposited it into my TH account. 150% of my profit has come through mining using a 6970. The other 550% has come though trading.
1) Use entire deposit to place a buy order approximately 10% below current market value. The exact price at which you set your bid order is dependent on a number of factors and takes a little experimentation to get "correct."
2) Wait for someone to dump a large amount of coins
3) Typically, a quick dump on TradeHill is immediately followed by a return to the pre-dump price assuming that the dump on TradeHill wasn't precipitated by a dump on Mt. Gox
4) Immediately sell your coins at the pre-dump price unless you have very good reason to think the price is going to continue to go up.
The pros of this method:
1) Assuming you keep close observance of the market, it will be very hard for you to lose a lot, if any, money. It's very low risk.
2) You stand to make anywhere between 5-10% profit on every trade.
The cons of this method
1) There will be many times where you will not perform any trades for several weeks, either because the price stays very stable or increases.
2) If the price increases, you may miss out on a rally because you are always waiting for the dumps.
3) If your buy order is not adjusted correctly, you will miss the dumps. I can't tell you how many times I would have caught the dips if I had increased my bid price by a penny. For example, today I had 2 buy orders placed: 1 buy order was set at 3.1300001 and the other was at 3.130001. One of the dumps hit my 3.130001. It missed my 3.1300001.
4) This is NOT a long-term investment strategy. It's essentially an extremely conservative day-trading strategy.
About 80% of my trades have been profitable whereas 20% have either been break-even trades or trades for a loss. I've also made a few mistakes including (yikes) typos while entering my bids or sells.