How Do I Start Trading Stocks With Little Money?
11/2/2025
How Do I Start Trading Stocks With Little Money?
Look, I’m going to be straight with you. When I first got interested in trading, I had maybe $200 I was willing to risk. And honestly? That wasn’t even enough to feel comfortable clicking “buy” on anything.
The financial guru bros on YouTube made it seem like you needed $25,000 just to get started (thanks, PDT rule 🙄). But here’s what I actually learned after three years of figuring this out the hard way.
The Real Minimum to Start Trading
Technically, you can open a brokerage account with most platforms for $0 these days. Fidelity, Schwab, Robinhood—they all dropped their minimums years ago. But having $0 in an account doesn’t mean you should start buying stocks yet.
Here’s the thing nobody tells you: the money you need isn’t the barrier. Knowledge is.
I know someone who started with $5,000, lost $3,000 in two months, and quit forever. I also know people who started with $100, learned the ropes properly, and slowly built their accounts up. The difference? They didn’t jump in blind.
Why Your First “Investment” Should Be $0
This is going to sound counterintuitive, but hear me out. Start with paper trading first.
When I finally stopped trying to prove I was smart enough to figure it out myself and actually practiced with fake money, everything changed. I could test strategies, make stupid mistakes, and learn what my actual risk tolerance was without watching real money evaporate.
On RankTrader, you literally start with $0. You get a virtual account, and you can trade against other people who are also learning. It’s like playing poker with chips before you sit down at a real table. Except unlike poker, you can actually see how you’d perform in real market conditions.
I spent three months paper trading before I put real money in. Best decision I ever made. Because when I finally did trade with my own cash, I’d already made all the dumb mistakes in practice mode.
What You Actually Need to Get Started
If you’re determined to trade with real money from day one (and I get it, paper trading feels less “real”), here’s my honest recommendation:
Start with $500-$1,000
Why this amount?
- It’s enough to feel real without being devastating if you mess up
- You can actually diversify into 2-3 positions
- Most strategies become viable (fractional shares help here)
- You’ll take it seriously but not lose sleep over every move
But here’s the catch: that $500 should be money you can afford to lose. I’m not being dramatic. I’m being realistic. Most new traders lose money at first. It’s part of the learning curve.
The Free Way to Actually Learn
Here’s my actual recommendation for someone starting from scratch:
Month 1-2: Paper trade only Get on RankTrader, set up your virtual portfolio, and just start making trades. See what works, what doesn’t. You’ll probably lose fake money. That’s perfect. Learn now while it’s free.
Month 3: Join a competition This is where RankTrader gets interesting. You can compete against other traders with paper money, and suddenly it feels real because there’s something at stake (bragging rights, leaderboards, sometimes actual prizes).
Month 4+: Consider real money After you’ve proven you can be consistent with paper trading, and you understand your strategy, then consider putting in real capital. Start small.
The Strategies That Work With Small Accounts
Once you do start trading real money, here’s what actually works when you have under $2,000:
Buy and hold individual stocks: Pick 2-3 companies you understand, buy fractional shares, and be patient. Boring but effective.
Swing trading: Hold positions for a few days to weeks. You avoid day trading rules and can catch bigger moves.
ETF investing: SPY, QQQ, VOO—these give you instant diversification. Less sexy than picking individual stocks, but way more practical for small accounts.
What doesn’t work? Day trading with a tiny account. You’ll get flagged as a pattern day trader if you have under $25k, and you can only make 3 day trades per 5 days. It’s restrictive and frustrating.
My Actual First-Trade Story
Want to know what I did when I first started? I put $800 into my account and immediately bought shares of a company because I saw someone mention it on Reddit. No research. No strategy. Just pure FOMO.
I lost $120 in two days.
That was my tuition for learning that I had no idea what I was doing. If I’d paper traded first, I would have made that exact same mistake—but for free.
The RankTrader Approach That Actually Makes Sense
Here’s why I think the paper trading route is so much better now than when I started:
I’ve been beta testing RankTrader - when it launches, you’ll be able to get a virtual account and start trading immediately. No money down. No risk.
But the competitive aspect changes everything. When you’re competing against other traders on leaderboards, trying to prove your strategy works, it pushes you to actually learn. It’s not just mindless paper trading—you’re seeing how you rank against real people testing real strategies.
And when you eventually do put real money in? You’ll already know what your win rate is, what your average losses look like, and whether you can actually stick to a plan when things get choppy.
The Bottom Line
You can start trading stocks with as little as $1 if you really want to. But should you? Probably not until you’ve practiced.
The amount of money you need is less important than the amount of knowledge you have. And lucky for you, gaining that knowledge doesn’t have to cost anything.
Start with paper trading. Take it seriously. Track your results. Compete against others. Learn what works for you.
Then, when you’re actually ready, start small with real money. $500, $1000, whatever you can afford to potentially lose while you’re still learning.
The traders who make it aren’t the ones who start with the most money. They’re the ones who start with the most discipline.
And discipline is free.
I’ve been beta testing a platform called RankTrader that does competitive paper trading really well. If you’re looking for a way to practice with actual market data and some competitive pressure to keep you honest, it’s worth checking out when they launch.