How to Day Trade
The Truth About Day Trading
This article provides answers to common questions from beginner traders that want to learn how to day trade. Hollywood often portrays day traders as lively characters who make a living by throwing paper around a busy electronic Wall Street trading room. An alternative theatric take on the life of a day trader is the stay-at-home insomniac, glued to his or her computer for countless hours looking at charts. Unsurprisingly, both interpretations of the life of a day trader differ from the truth. By learning how to day trade, we can see where reality separates from what the script writers say. To set the record straight, the rest of this article is divided into two categories: Assumption (representing common belief) and Reality (what the truth is).
Assumption: You can only make a living day trading by physically placing orders at Wall Street or at the CME (Chicago Mercantile Exchange).
Reality: Entirely a myth. Hundreds of thousands of day traders make a living (or additional income) by trading from home or office computers. Electronic day trading software is a multimillion-dollar industry with numerous companies that have been in business for many years. In addition, teaching traders how to day trade is also a large business (evident by this site).
Assumption: In order to learn how to day trade, you need to attend college to acquire a business or finance degree.
Reality: Untrue. Hundreds of thousands of day traders make a living (or additional income) by trading from home or office computers. Electronic day trading software is a million-dollar industry with numerous companies that have been in business for many years. Check out NinjaTrader, MetaStock, eSignal, MetaTrader and TradeStation to see the large communities and support offered by these industry-leading trading systems. With such support, it's never been easier to learn how to day trade.
Assumption: Day trading requires at least $20,000 to get started.
Reality: Misconception. To trade stocks, brokers require at least $25,000 to trade. This high cost is associated with the estimated risk involved with trading stocks combined with the general cost factor for purchasing stocks. Unlike stocks, markets like the E-Mini have a fixed value. This makes them much more accessible. E-Mini traders, by comparison, are able to begin trading with as little as $5,000. Of course, traders should only trade with money they can afford losing (not food or rent money for example). No matter what commodity, stock or index is being traded, each trader should pursue education in learning how to day trade to prevent losses.
Assumption: Learning how to day trade is expensive.
Reality: Depends on who you learn from and the quality of the educational materials. At Day Trade To Win, we offer the best bang for the buck. We offer specialized solutions (scalping courses for example) for traders who want an additional strategy. We also offer complete training, as with the Private Mentorship program, which teaches traders how to day trade from A to Z.
Assumption: To day trade for a living, you have to spend all day on the computer.
Reality: Again, this depends on the day trading systems and strategies you're using. At Day Trade To Win, we understand that people have children, pets, food to eat and places to be other than in front of the computer. Our focus, especially with the ATO (At the Open) is to teach you how to day trade profitably by noon. With enough contracts, a trader can lead a very healthy lifestyle by trading several hours each day.
Assumption: Day trading is a job for single, middle to upper class males who have abundant disposable income.
Reality: False. Day Trade To Win has many female clients (surprisingly so, actually). Day trading is a job of great flexibility. This allows plenty of time for daily responsibilities. Our clients come from a wide range of financial backgrounds – from highly successful entrepreneurs to everyday Joes. We believe that learning how to day trade effectively is a skill that can be learned by anyone, regardless of life history, gender and wealth.
Assumption: All day traders succumb to a total realization of greed, ending up breaking even at the end of the careers or worse off.
Reality: Incorrect. Day trading is not gambling. The markets are regulated and are reasonably predictable unlike the sequence of numbers generated from the pull of a slot machine. More importantly, price is based on a more palpable quality – an applied value of a company, currency or contract. At Day Trade to Win, we teach traders how to avoid risks. We don't want them trading until they fully understand a method. Trading is psychological. Using objective methods (not whimsical / astrological interpretations), we teach how to day trade without the nonsense and deliver results. Regarding the last point (end of careers), many traders begin day trading as a hobby during retirement.
Assumption: If I become a day trader, I will need to buy a webcam and set it up throughout my house to record paranormal activity.
Reality: True. Just kidding – only part of this is true. We only recommend that you have a webcam to record a testimonial for us, providing you've taken a course to learn how to day trade and you honestly want to review it (good or bad). If your house becomes haunted, there's nothing we can do about it (this is in reference to the movie Paranormal Activity where one of the characters is a stay-at-home day trader, by the way). If you're not making any money day trading, then there's something we can do about it. Head on over to our courses page to see what's best for you.