How to Be a Day Trader

Learning to be a day trader

Being a day trader can be very exciting and rewarding. You can work from the comforts of your home and make a lot of money in a very short time. Even amateur traders can compete with the large professional trader because the small investors now have access to the same tools and information that only the professional trader had. However, becoming a successful day trader is not easy or without risk.

Difficulty:

Moderately Challenging

Instructions

1. Get the tools you need to become a day trader. Set up a trading station with online access. Subscribe to any financial newspaper or online access to brokerage trading tools. Having good information is a key to trading success.

2. Study different day-trading strategies to find one you are comfortable with. Decide which markets or sector you wish to trade in. It is better to be a master of an industry or strategy than always changing strategies.

3. Practice trading on paper or with a free online demo account before trading with real money. Track your results and learn from your mistakes and perfect your strategy.

4. Keep informed with world and financial news. In a global market, events around the world can affect your investments, so be prepared and informed.

5. Be disciplined with your trading. Don't get emotional with your investments and limit your losses so that you can trade another day. Be prepared for volatility.

Tips & Warnings

• Day traders often make very little per trade, so use a reliable broker with low commissions. As with any business, you need to keep your expenses low to remain profitable.

• Big profits can be made day trading, but it can be very risky. A swing in the market can wipe out your profits quickly. Hedge your trades whenever you can to preserve your trading capital.

Resources

• E-Trade