I think learning how to day trade for a living is one of the smartest things you can do with your extra time while on lockdown.
Think about it … this year we’ve all had to learn social distancing. Many of us are still on lockdown orders … And a lot of people are ready to learn something new with all the free time on their hands…
Like how to day trade for a living.
I think this is a great time to learn. The stock market’s been so volatile lately — that’s amazing for active traders. Despite the market mess, many of my top students and I are nailing trade after trade. It’s not hard to see how great it is to be a prepared, self-sufficient penny stock trader right now.
In this post, I’ll tell you how to day trade for a living. Plus I’ll give you pointers on how to know if day trading is right for you, and how to get started. Let’s do this!
Table of Contents
- 1 What Day Traders Do
- 2 An Example of Day Trading
- 3 Is Day Trading For a Living Possible?
- 4 Benefits and Challenges of Day Trading
- 5 How to Day Trade for a Living: 7 Pro Tips
- 6 How to Day Trade for a Living: The Bottom Line
What Day Traders Do
Every day when the stock market opens, thousands of stocks start moving. They tick up and down in price until trading finishes in the afternoon.
Day traders try to find the biggest movers and ride the momentum. They profit by buying and selling stocks and riding those short-term price movements. It all usually happens in one day — hence, day traders.
People drawn to the markets, the laptop lifestyle, and self-employment are often drawn to day trading … But what does it really take to pursue a career as a professional day trader in 2021? Before I answer that, let’s look at…
An Example of Day Trading
So, what’s a day trade look like? It’s pretty simple…
Here’s a hypothetical example:
You decide to keep a list of all the penny stocks that recently had big moves in price. Clickstream Corp (OTCPK: CLIS) is one of the tickers that pops up. This internet data play was a huge runner the week before. (Read more about former runners here.)
You add it to your stock watchlist. (Sign up for my FREE weekly watchlist here.) One morning you see the company’s made a big announcement. You think it’s enough to push the stock price up — at least in the short term.
You decide to purchase the stock at 17 cents per share after the market opens. The stock gradually moves up in price over the day, hitting a high of 25 cents by the afternoon.
Notice I mention a key indicator here: a company announcement. Check out this video for how company news — or even the anticipation of it — can move stocks:
There’s so much more that goes into deciding which stocks to day trade … But in a nutshell, day trading is entering and exiting a stock position within a single trading day. And I want to take a moment to answer a question I get a lot…
Is Day Trading For a Living Possible?
People love to ask me this question. They wonder if anyone can really make a career out of trading stocks day in, day out…
Working from home, being your own boss, taking days off whenever you like, working from anywhere (when there’s not a global pandemic) … Not many careers are anything like this…
I’ve been making a living from the markets for over 20 years. I turned my $12,415 bar mitzvah money into over $1.65 million in college. Since then, I’ve made over $5 million in trading profits.**
I’m not the only one who can day trade for a living. I designed my Trading Challenge to teach students to be self-sufficient traders. Some of my top students have gone on to become millionaires** … Some even trade better than me. I think that’s the best compliment a teacher can get.
So, absolutely, learning how to day trade for a living is possible — if you’re prepared to work hard, study your butt off, and commit to the process.
(**Note: success as a trader requires dedication and effort. Most traders — roughly 90% — lose money. These results are not typical. Do your due diligence and never risk more than you can afford to lose.)
Time to move on to the…
Benefits and Challenges of Day Trading
Time for real talk. Let’s examine why day trading can be an amazing profession — even if it means you gotta work HARD.
That’s what can come with the trading career, and I hope it excites you. I love trading penny stocks, and I love the life I get to live because of my success.
But what about the downside?
To be honest, the day trading success rate is pretty low. Somewhere around 90% of traders lose money. But that’s not as bad as it sounds…
To be honest, the average wannabe trader is a complete idiot. If you’ve found me, and you’re reading this blog, you’re probably looking for real information. That puts you ahead of so many traders.
And I’ll say it again — trading for a living requires a lot of hard work. And there’s no guarantee you’ll ever truly get it.
So yeah, there are the downsides. But ask any professional trader, they’ll almost all tell you it’s all worth it in the end. Now let’s look at…
How to Day Trade for a Living: 7 Pro Tips
If you’ve made it this far into this post, you’re probably starting to wonder if pursuing a trading career could be for you.
So what’s next?
Here’s a list of 7 tips for how to become a self-sufficient day trader in 2021 and day trade for a living.
1. Learn a Trading Strategy
You can’t just approach the market with guns blazing, buying and selling whatever looks hot.
If you try to trade like that, you can kiss your trading capital goodbye in no time at all…
You need to have a set trading strategy. You need to understand the process.
Or a strategy could be more complex, like stocks hitting all-time-highs, with hot news, and huge buying pressure…
Your strategy can be as simple or as complicated as you’d like to make it.
Trading is all about performance — like playing a sport or learning to play an instrument.
Think about it … If you want to get good at golf, what do you do? Practice hours and hours at the driving range.
If baseball’s your thing, you spend hours in the batting cage. If it’s music, what do you have to do? Practice!
It’s exactly the same in trading.
Being a skilled trader involves training your brain to pick up on stock patterns that happen all the time. You have to know what to do when stock prices are going wild. It takes time and a lot of practice to gain experience that will help you trade better.
You can practice trading in a number of ways…
First, there’s simply getting screen time. That’s where you sit in front of your trading screens and watch stocks. You see how they react at certain price levels or when big news stories hit.
When you’re ready, you can start trading small. You can get the feel for small gains and how to cut losses quickly — that’s rule #1! And you’ll learn the psychological lessons that come with having real money at stake in the markets.
Whichever way you choose to practice, work to improve a little bit each day. That’s how you build your trading skills and your knowledge account. Maybe you’ll even be on your way to becoming my next top student.
3. Get Some Trading Capital
Ever heard the saying “it takes money to make money?”
That’s kinda true in trading. You need some capital in your account to buy and sell stocks. But you don’t need to start with big money.
You can start with a small amount of capital and let small gains add up…
(**Students’ results are NOT typical. Roughly 90% of traders lose. Always remember trading is risky, and never risk more than you can afford.)
How’d he do it? He studied his butt off and made lots of trades. When he found consistency in his trades, he gradually increased his trading size. Most importantly, he stays humble and keeps learning.
So, if you want to start trading, build your knowledge account first. And when you’re ready, you can start with a small account.
4. Choose the Right Broker
If you want to trade stocks, you need to open an account with a stock brokerage. Don’t worry — it’s a pretty quick and easy process.
But it’s important to understand that not all stock brokerage firms are equal.
Repeat after me: I will only trade with reputable brokerage firms!
Reputable brokers are often located in the U.S., heavily regulated, and well-capitalized. These are usually safer places for your trading funds. Some are small but highly respected firms. Some are easily recognized, like TD Ameritrade and E-Trade.
They all have different account types, rules, minimum balance requirements, and fees. Take time to find the right one for you.
5. Get a Trading Mentor
Want to succeed as a trader as fast as humanly possible? Find a trading mentor.
Trading mentors can help you shorten your learning curve. They can help you avoid a lot of headaches and dead ends in your trading journey.
I have to warn you though … Be careful who you pick as your mentor. The trader education industry is full of snake oil sellers who couldn’t trade their way out of a paper bag.
That’s one of the reasons I created Profit.ly. It’s a website that allows traders to enter, track, and verify every single trade. You can see me there with over $5 million in verified trading profits.**
6. Master your Trading Platform
You have to use the best tools. Your trading platform is everything. Master your trading platform.
It’s how you can find the best stocks for your strategy. You can use it to build and maintain watchlists. And it’s also where you can catch social media buzz on stocks — if you use the right platform.
I use StocksToTrade every day. I helped design it, so the built-in scans fit my strategies for day trading low-priced stocks. This tool is incredible. You can check out StocksToTrade with a 14-day trial for just $7.
Back in the day, premarket prep was way more work. Be thankful you’re starting trading in 2021 … It’s so much easier to research and trade stocks. But know what you’re getting into. For the record, I trade with these rules.
7. Work on Your Trading Psychology
What do most newbie traders struggle with the most?
It’s not finding trading setups or the right strategy…
One of the biggest challenges for traders is trading psychology and having the right mindset.
Trading is HARD. And it’s not as simple as winning trade = good or losing trade = bad.
It’s about the process. It’s finding consistency and knowing how to cut losses.
Your mindset and how you approach the market every day is crucial. It’s how you develop discipline.
How to Day Trade for a Living: The Bottom Line
I think learning how to day trade is great for 2021. You have access to so many resources now. The internet’s changed everything.
And you can choose your level of commitment. I have tons of free videos on YouTube. You can subscribe to Pennystocking Silver for access to thousands of videos and learn from the past (yes, it matters!). When you’re really ready to commit, you can apply for my Trading Challenge.
The steps in this post can give you a powerful head start if you think you’re ready to learn how to day trade for a living.
What do you think? How willing are you to put in the work to learn how to day trade? Leave a comment below!