A growing number of individuals are taking advantage of the market volatility by engaging in day trading.
Trading stocks every day is a popular way to amass wealth swiftly.
Is this form of speculative investment really worth it?
Is there any resemblance to the dot-com boom of the 1990s, or is it completely safe to start day trading as a newbie right now?
How do you day trade safely?
How do you day trade profitably?
Now, before we answer these questions, I want to be totally up front here, so…
If you’re like most of my readers, you came across Day Trading for one main reason:
You want to make more money than you currently make, ideally by leveraging resources you already have.
Maybe you’re even looking for a quick turnaround on some of your cash, instead of waiting years, or even decades for it to compound.
Well, you’re in good company – who wouldn’t want all of that?
There’s one thing you need to watch out for though: legitimate scammers.
The idea of making 10X on your money in a day is obviously something that would entice the masses, and so it naturally attracts a lot of bad actors into the financial products space.
But for purposes of this review, let’s assume these people had the best of intentions.
Even with the most sophisticated systems out there, most experts barely manage to get it right 10% of the time…
Obviously there’s an argument to be made that 1 winning bet can outshine 10 losing ones…
But if you mess up and miss a trade even one time, your month can turn sour pretty quickly.
Suffice to say, there’s a whole lot of stress & uncertainty.
Now don’t get me wrong, it doesn’t mean you’re guaranteed to lose money. I’m just saying that you need to be aware of what you’re getting yourself into.
But what if you could build a different income stream, and start seeing profits within your first few days?
I’m talking about a system that doesn’t require:
- Obsessively checking your phone and charts
- The emotional turmoil of loss after loss, waiting for that win
- Glorified gambling
Something that you could make anywhere from $2,000 – $10,000 with consistently, month after month?
A stream of income that you can build as high (or low) as you feel like building it, without spending every waking hour watching for alerts and pouring over charts?
If that sounds interesting, you might want to think about using the Digital Rental Method.
If you wanna see what Day Trading looks like on the inside, keep reading.
What To Expect From This Day Trading Review
This review will go over how to day trade.
You’ll learn whether day trading is the right online business for you.
And at the end, you’ll find answers to some of the most frequently asked questions regarding day trading in general.
But most importantly, you’ll see the exact system many others have used to build their own internet marketing business to over $40,000 a month in mostly passive income.
What Is Day Trading?
For those unfamiliar, “day trading” refers to the practice of purchasing and selling stocks on the same trading day. Though it’s not limited to the foreign exchange (FX) and stock markets, those are where it’s seen most often.
A day trader is often well-educated and financially secure.
Swing traders use high levels of leverage and short-term trading tactics to profit from small price swings in highly liquid stocks or currencies.
A day trader is acutely aware of factors that drive short-term market movements. Trading on the basis of news is a common strategy. Economic data, company profits, and interest rates are all susceptible to market expectations and market psychology.
When such expectations are not fulfilled or surpassed, markets respond with fast, large swings, which may tremendously benefit a day trader.
Can I Really Make Money Day Trading?
Yes, You can!
But…
There’s a lot that comes along with day trading that many people struggle with.
Now, don’t get the wrong idea…
It’s not impossible to make money with day trading, but if you’re gonna put in the amount of grueling work to do this business (which, trust me, isn’t easy), you might as well bring in some REAL money while you’re learning the ropes.
How To Day Trade: What Is The Average Career Duration Of Day Traders?
Well, it depends. Some individuals may spend the rest of their lives on day trading.
One bad deal might end your day trading career if you don’t understand and manage your risks. That’s why it’s important to get ready..
A mentoring program, such as the SteadyTrade Team, might help you in your endeavor. There’s a chat room, a community, twice-daily webinars, and much more:
https://stockstotrade.com/steadytrade-team/
How To Day Trade: How Does Day Trading Work?
The definition of trading is to try to make a profit by buying an asset at a low price and selling it at a higher one. This is only the gist of a much larger and more complex set of trading methods, but it gets to the essence of what is at play here.
Day trading is done more regularly. Day traders finish their deals entirely in the same day, as opposed to buying a stock and keeping it overnight or longer.
How To Day Trade: Day Trading Tips For Beginners
There are many ways to increase your earnings from day trading, but the three most important are as follows, all of which have to do with mitigating the risks involved in day trading:
You Should Only Trade With Money You Can Afford To Lose.
Day trading requires a sizeable cash reserve; therefore, it’s important to exercise responsible financial planning and set aside a fixed amount of money for this purpose. Stop trading if your monthly mortgage or rent payment exceeds that amount. Why? There’s a chance you’ll lose it.
Start Trading Small.
When you start day trading, you inevitably make mistakes and lose money. When you first start your day trading activities, it’s important to limit your losses until you get more experience.
Don’t Give Up Your Day Job.
In a market that has been rising steadily, you may have a run of good fortune. Before expanding your efforts, you should assess how well your trading strategy performs during market volatility, such as a recession. Once you’ve made a consistent profit, you may decide how much time you want to devote to trading.
Start With Paper Trading.
Every newcomer makes mistakes, particularly when it comes to something as sophisticated as day trading the stock market.
Using real-time data, traders may simulate a real-life trading environment. Paper trading allows you to practice your setups without risking real money.
StocksToTrade is one of the greatest platforms available. It offers a strong paper trading function that allows you to practice your abilities without worrying about depleting your money account.
What You Will Need Before Starting Day Trading
Strong Understanding Of Day Trading Terminology And Technical Analysis
Learning the ropes of day trading, much alone becoming an expert, is no easy feat. The act of day trading may be compared to that of a professional athlete. Making money depends solely on how consistently you execute.
Trying to day trade without any kind of training or knowledge is a formula for catastrophe and financial loss.
Reading books and watching videos is the first step in learning day trading vocabulary and technical analysis! This is the process of acquiring knowledge. But keep in mind that just because you’ve read a skydiving book doesn’t imply you’re ready to jump out of an aircraft!
One of the difficulties in learning to trade is the vast quantity of information available. Things you discover will often be paradoxical. The reason for this is that technical analysis or entry and exit requirements that work for one strategy may not work at all for another.
Learning a little bit of 100 different tactics will not benefit you in the long run. It’s much better to understand all you can about a single successful method. So, while deciding who you’ll learn from, it’s always a good idea to ask yourself, “Is this individual genuinely profitable?“
The first step in learning how to day trade is to research.
Developing Profitable Day Trading Strategies Or Adopting Proven Day Trading Strategies
As a budding trader, you have two-day trading strategy options. You may either choose a strategy that is currently being used by other traders or develop your own.
If you make your own, expect to spend months, if not years, backtesting and polishing it before you can trade with real money.
Rather than reinventing the wheel, most new traders choose to learn a lucrative approach that has previously been proven. After learning that strategy, traders may choose to put their own spin on it by modifying it somewhat.
Whatever technique you use, it’s critical to have a certain setup, trading system, or methodology that you’re comfortable with before you begin trading.
It lets you focus on developing a competency in one area rather than attempting to locate opportunities for many setups at once and never truly being proficient in any of them.
If the setup/system you chose isn’t great for you, you may always learn more later.
The main thing is to focus on one thing and master it from the start. Whether you attempt to trade five different strategies at the same time, how do you know if one of them is lucrative if one of the others is losing you a lot of money?
Practice In A Day Trading Simulator To Convert Knowledge To Skill
You may have completed a few great trading courses, read a book or two, and been following free online coaches and believe you are ready to trade.
However, the fact is that you are most likely not prepared. Beginner-day traders are renowned for overestimating their skills, trading with real money, and losing.
Understanding day trading intellectually is not the same as being able to respond to opportunities and effectively execute them in real-time.
Here’s when practice comes in handy.
You’ll need a trading simulator to practice your strategies in real-time until you’re comfortable with order entry and trade management.
If you can’t earn money in a trading simulator, odds are you won’t be able to make money in a real account either!
One of the greatest mistakes a newbie trader can do is to enter a genuine trading account cold turkey.
What Are The Risks Of Day Trading?
The Securities and Exchange Commission (SEC) of the United States highlights some of the risks associated with day trading, which are described below:
Be prepared to lose money – a lot of money:
Because day traders generally lose a lot of money in their first few months of trading, and many of them never make a profit, good risk management is to risk losing money that they can afford to lose.
Day trading is a high-stress, high-cost full-time job:
Day trading is highly challenging and requires a high level of focus to monitor hundreds of ticker quotes and price movements in order to recognize market trends. Day traders have high expenses as well, generally paying big sums to their businesses for commissions, training, and computers.
Day traders rely heavily on borrowed funds:
Day-trading tactics employ borrowed money as leverage to create gains, which is why many day traders not only lose all of their money but also wind up in debt.
What Are The Day Trader’s Margin Requirements?
The minimum equity requirement for a client of a broker-dealer who is designated as a pattern day trader is $25,000, which must be put into the client’s account prior to any day-trading activity and maintained at all times, according to Financial Industry Regulatory Authority (FINRA)2 rules.
What Is A Pattern Day Trader?
A pattern day trader (PDT) is a regulatory classification for traders or investors that execute four or more day transactions utilizing a margin account over the course of five working days. The number of day transactions must amount to more than 6% of overall trading activity in the margin account during that five-day period.
If this happens, the trader’s account will be marked by their broker as a PDT. The PDT classification restricts future trading. This designation was meant to dissuade investors from trading excessively.
Should You Get Involved In Day Trading?
Day trading is only one strategy for the stock market, and it’s not for most investors. Here are some resources to help you balance less-intensive and easier methods of expanding your money management:
NerdWallet’s guide on how to invest money.
https://www.nerdwallet.com/article/investing/how-to-invest-money
Why Don’t Day Traders Keep Their Positions Overnight?
Day traders typically do not hold positions overnight for a variety of reasons, including most brokers have higher margin requirements for overnight trades, necessitating additional capital; a stock can gap down or up on overnight news, resulting in a large trading loss; and holding a loss-making position overnight in the hope that part or all of the losses can be recouped may violate the trader’s core day-trading philosophy.
Day Trading’s Best Securities
To begin, you must pick what types of securities you will buy and sell. Bonds, options, futures, commodities, and currencies may all be day traded, but stocks are among the most popular for a successful day trader since the market is large and busy, and fees are minimal or nonexistent.
The greatest day trading stocks often have the following characteristics:
Good volume
Stocks are popular among day traders because they are liquid, which means they can be traded often and in large volumes. Liquidity enables a trader to buy and sell without significantly impacting the price. Currency markets are likewise very liquid.
Day Trading Tools You Need
What you’ll need to get started with day trading:
- Online Broker
- Scanners
- Charting Platform
When Looking For A Broker, There Are A Few Factors To Consider:
Trade Execution
Some successful traders have certain requirements for their brokers. The most critical factor is execution speed. A matter of seconds may be the difference between catching and missing a breakaway. As a result, professional day traders want a broker that offers direct market access (DMA).
You may be wondering, ‘Don’t all brokers provide direct market access?’ No. Most online brokers serve as a go-between for the market and your order. When they sell your order flow, they route it to the market on your behalf, often merging your order with other customers’ requests and giving precedence to some routes over others.
To eliminate through the middlemen, you’ll need a broker who offers DMA. This way, if there is a bid or ask that you want to trade with, you can just grab that liquidity immediately rather than hope the stock trades at your price long enough for your broker to complete the order.
Lightspeed Trading is one example of a broker that provides direct market access.
Commissions
Because day traders trade so often, fees might be the difference between a lucrative and a losing month.
When it comes to day trading brokers, there are two price systems to choose from: per-share and per-trade. The option you choose is determined on the size of your position. The smaller the company, the more sense a per-share structure makes, and vice versa.
Per-Share:
Day trading brokers and proprietary trading businesses like the per-share structure. The typical per-share rate paid to the least capitalized retail traders is $0.005 per traded share.
Some businesses have a $5.00 minimum, which contradicts the point of the structure for a trader with less funds.
Per-Trade:
This is the industry’s most prevalent commission structure. You just pay a fee (usually approximately $5.00) for each trade you make. A $5 fee each transaction becomes essentially nothing after you reach a certain average position size.
Quick Note: It’s important to recognize that just because a broker has lower commissions doesn’t mean they’re a superior alternative. Some brokers are compensated for steering their order flow to certain market makers, which may result in longer wait times and lower fill costs. That is why, as previously said, it is critical that they have direct market access.
Stock Scanner
There is a significant distinction between a stock scanner and a stock screener:
Stock scanners continuously scan the market and transmit real-time data.
Stock screeners essentially scan the market for criteria and provide a static list of stocks, generally with data from the previous day.
Most day traders, particularly those who trade on extremely short time periods, need a decent stock scanner. Most scanners can scan on timeframes as short as ticks and as long as weeks, all while updating data in real time.
What is the purpose of a stock scanner? Because you need to trade the appropriate stocks, scanners are essential. Stocks that are moving on high relative volume as a result of some form of catalyst. We refer to them as ‘stocks in play.’
In-play stocks are more likely to follow through on breakouts and trend in a definite direction throughout the day.
This raises their predictability and boosts your chances of making winning deals. There are other scanner programs available, but Trade-Ideas is a favorite. Their scanners are completely configurable and quite dependable.
Charting Platform
Having a solid and dependable charting platform is beneficial for seeing price activity and making trading choices. Unfortunately, many brokers’ charting tools do not match the needs of active traders, thus they rely on third-party charting software.
eSignal is a sophisticated and complete day trading charting software on the market that is a good option.
How To Start Day Trading
Once you’ve mastered a strategy and are successfully trading it on a simulator, you may start trading in a real account.
Here are the steps you must take:
Open a brokerage account and deposit funds.
Have a written trading strategy that you can go through every morning.
Make your watchlist first thing in the morning.
Make a plan and stick to it.
At the end of the day, go through your trades.
Taking it slow is one of the most important pieces of advice we can provide novice traders in a real account.
Don’t go in headfirst and trade for maximum size. Take it slowly at first until you feel at ease.
Trade on a real account adds a lot more emotion and pressure to your trading, which will diminish as you acquire expertise.
After all, you don’t want to blow up your account and lose all your money on the first day!
How Much Capital Is Needed In Day Trading?
The amount of money you need is determined by whether you intend to make day trading your full-time income or simply a side business to generate a few extra bucks here and there.
Someone opened a modest account with $500 and grew it to over a million dollars in only two years.
That is an extreme case, and most traders, even experienced traders, would struggle to replicate such a return.
My argument is that you don’t need a lot of money to begin day trading.
However, while determining how much money you need, you must ask yourself two questions:
How much do you hope to earn every day?
How much money do you have to begin day trading with?
We just need to complete some simple mathematics once we get the answers to those questions.
Assume you want to earn $100 every day but only have $1,000 to invest in your day trading account.
That implies that if you trade stock for $2.00 a share, you can buy 500 shares, which means the price must rise 20 cents in your favor to meet your $100 objective.
This is an extremely simplistic example since we didn’t account for margin, which would give you greater purchasing power.
How Much Do Day Traders Get Paid?
This is a wide topic since many various factors come into play, such as the amount of funds you trade with, your skill level, market circumstances, and so on.
Highly expert traders may earn seven figures per year, while novice profitable traders can earn $200-$500 per day.
The markets are open around 253 days per year, which equates to $50,600 per year if you average $200 every day. That’s not awful!
If you make $500 every day, you’ll make $126,500 in a year!
Conclusion
Despite the fact that day trading has become somewhat controversial, it may be a profitable way to earn a living. Day traders, both institutional day traders and retail day traders, play a vital role in the market by keeping it efficient and liquid. While the day trading journey is still popular among newcomers, it should be reserved largely for individuals with the necessary expertise, resources, and trading platform.
Read Our In Depth Breakdown Of The Top 5 OppStocks Courses For 2024
But, when it comes to building a business, you have plenty of options. And even if you’re dead set on becoming a day trader, you’ve got way better options than day trading.
Keep in mind, I don’t get paid to promote any of the programs I review. I personally think day trading is a great business model, but you could end up leaving way too much money on the table.
Are There Alternatives To Day Trading
Yes, there are plenty of other business models to choose from if you want to pursue this making money online. Here are just a few:
Is Day Trading Legit Or A Scam?
Alright, time for the $1,000,000 question: is Day Trading a scam?
No, not technically. You can 100% make money with it, but it’s not NEARLY as simple as Day Trading wants you to think it is.
You need to understand that you are taking a very big risk with financial products.
So while it’s entirely possible that you hit the big leagues and retire to a vineyard… the path to get there is so stressful, it might just shave a decade off your life… IF you even get there.
A friend of mine actually writes advertisements for one of the largest financial program advertisers in the world… so believe me when I say: most of the awesome numbers they use in their ads & landing pages are borderline false.
What they conveniently leave out are the dozens of losing bets and trades that came before the big win you’re reading about.
Now, most people don’t have the emotional bandwidth to stick out 3 months of back-to-back losses before (hopefully) getting a big win.
I’d rather use that 3 months of work (in my spare time) building Digital Rental Properties, and then collect a handful of nice little $500-$2,000 checks every single month afterward (AKA passive income).
And the cool part is that you can do it in a lot less time than 3-months (I personally did it in my first 2 weeks of using the Digital Rental Method).
You can do it from anywhere in the world, so it’s a genuine “laptop-lifestyle” business.
All you need is a laptop and an internet connection.
Some of my friends are Digital Rental Method that run their 6-figure businesses from:
- Camping trips at national parks
- Beachfront in Hawaii
- On the road in a camper van (with a pet pig!)
They focus on living an enjoyable life first, and focus on income second. All thanks to this program.
They can take weeks or months off, and money keeps rolling in.
Living happily is the top priority.
If the thought of living perpetually at your dream vacation spot interests you, being a Digital Landlord might be for you!
What Is My Top Recommendation For Making Money Online In 2022?
I’ve personally tried all of the major online business models:
- I’ve traded crypto & purchased a bunch of fancy “insider stock tip” newsletters
- I’ve sold fidget spinners through Amazon FBA
- I’ve drop-shipped a toilet bowl putting green on Shopify
- I’ve sold women’s health supplements via Clickbank affiliate marketing
And I made money with all of them, so trust me when I say: there is no “perfect” business model.
That being said, my #1 recommendation for making real money online is, hands-down: being a Digital Landlord.
Whether you’re a complete newbie, or you’ve been around the block before but have never had that “big win” to propel you forward, using the Digital Rental Method is for you.
Why?
1)Time: If you’ve got a spare hour or two each day, you can do this. If you want to drop everything and go all in, you can do this. More time obviously means faster results, but even putting in a few hours per day is enough to see real success.
And because of that flexibility, you don’t need to trade your time for money. Once the income starts, it’s recurring.
That means you can take a month off, travel the country, pursue a passion project, chill on the beach, or charter a boat across the world.
But you can only do that once you’ve created an income stream that doesn’t require YOU to be there all day, every day.
2) You Own & Control EVERYTHING: When it comes to the markets, nothing is in your control. You have zero influence over market-shifting macroeconomic trends.
The number of people that have ACTUALLY beat the market consistently can be counted on one hand.
Why pour your soul into a business that you realistically have zero control over?
With the Digital Rental Method, you literally own all of the assets, which means you have ultimate control.
3) It’s Effectively Copy-Paste: Here’s my favorite part: once you have your first Digital Rental Property up, you can literally copy-paste another version of it and find another willing “renter” in a few days. DOUBLING your income doesn’t get much easier than that…
If you wanted to double your income in the markets, you would need to make twice as many winning trades, or double your profit on each trade. And I can guarantee you that’s a lot harder than a few clicks & a phone call.
4) Make Money Helping Real People: When you make money in the markets, you’re not really helping anyone but yourself. There is a loser on the other end of that trade.
But With the Digital Rental Method, you’re helping solve REAL problems that people are ASKING for help with:
Small local businesses around the world need one thing: customers. Without them, their business would fall apart. If you can provide those customers, they’re going to be really happy – and they’re going to pay you for it.
You’re helping a struggling mother or father put food on the table for their families, put their kids through college, or simply live life a little bit more comfortably.
Having this type of impact on the world is what will help you sleep soundly at night.
So, the rest is up to you. You could keep looking at other programs like Day Trading, which might make you money if you luck out.
You could keep researching and researching for the next few months (or few years), never making a concrete decision.
OR, you can look deep inside, think about those dreams, hopes, & desires, and make the decision to ACTUALLY make it happen, just like it has for thousands of other students before you.
Making a fortune while actually helping real people that need it.
If this sounds like you, click here to see how it all works.
