Many people who take a look as day trading as a career want to learn how to make a lot of Money in a short amount of time. Essentially, they want to get rich quick. Now, that sound like a tough ask. Most people who want that will fall prey to all sorts of get-rich-quick” schemes that will offer promises of easy money but leave the marks penniless at the end.
The irony of day trading is that you can make a lot of money, very quickly. But it will take years and years of practice before you get good enough to be able to do that.
One such story going around about a day Trader that made six figures in just two months sounds like the pitch for one of those schemes, but it actually is true. A veteran day trader took $583.15, put it in a brokerage account and, 44 trading days later, that money had been turned into $100,000. No joke. The verified broker statements are right here.
Now, it needs to be said that this particular trader has years of experience in the world of day trading, going through the school of hard knocks and coming out the other side, ready and able to put is skills to work on a day trading challenge like this.
For regular, novice traders to get ready to take on a challenge like this, they need a lot of reps. They need to spend time learning day trading strategies, how to pick stocks in real time, what to look for in a daily watch list, what free tools for day trading are best to start with, how to manage risk effectively and where to practice all those skills before risking their real money out in the Stock market.
And risk management really is the name of the game. More than 90 percent of day traders lose money. And most of those losses are a direct result of poor risk management. They send good money after bad by staying in losing trades too long. In order to beat the market, you need to get beat on individual trades quickly, limit those losses as much as possible and rack up enough winners so that at the end of the week, you have made more money than you have lost.
When you learn momentum day trading strategies, you learn to read a daily watch list, maybe from another veteran trader or maybe from a daily trading chat room. You then look at the fundamentals of a particular stock you may be considering, like the float. The float is the number of shares out there on the market, ready to be snapped up by regular traders. Then you want to be aware of any breaking news catalysts that might make the stock ready to move on that day. Taking advantage of the momentum of a stock on a particular day is key.
As a novice trader, you want to be able to take advantage of those stocks that are ready to move. And in order to be able to do that, you need to practice. How do you practice day trading? You spend time in a paper trading simulator.
Paper trading simulators allow you to start out with a certain amount of virtual currency and trade in a real-time market simulator that mimics the conditions of the normal stock market. That way, you can make mistakes and try out the strategies that you learn in online day trading classes, without the chance to lose any real money.
By making mistakes in a simulator, you can learn exactly what not to do when you get out into the real market. That experience can be invaluable for really embedding the techniques into your brain, so you can execute them faster and faster out in the real world.
Speed really is the name of the game in day trading. You want to be able to jump on fast moving stocks as early as possible, so you can maximize the amount of profits and get out before the inevitable crash. Volatility is your friend when you are a day trader.
So, when you start down the path of being a regular day trader, know that it is possible to get to the level where you can make six figures in just a couple of months. But that ability is built on years of study and practice. If you remember one thing, it is this: Day trading maybe a way to get rich, but it is not a way to get rich quickly.
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