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Day trading is buying and selling a financial instrument within the same day or even multiple times in a single day. Taking advantage of small price moves can be a lucrative game if played correctly. Despite the name, not all day traders are dummies. In fact, many day traders are pretty savvy. However, there are still a lot of people who lose money day trading. If you’re thinking about giving it a go, here’s what you need to know.


How Does Day Trading Work?

To make money day trading, you need to buy low and sell high—or sell high and buy low, in the case of short selling. Sounds simple enough, right? The hard part is knowing when to do it. Trying to time the market is a fool’s game—instead, you need to have a system that will help you make money in both rising and falling markets. 

Creating a system isn’t easy, and it will take some time to perfect. However, once you have a system that works for you, stick with it! The worst thing you can do as a day trader is constantly change your strategies. Over time, you will develop an intuition for when to buy and sell. Still, in the beginning, it’s essential to have set rules in place, so you don’t make any costly errors.


What Kind of Instruments Can I Trade?

You can day trade stocks, bonds, currencies, commodities—pretty much anything that is traded on an exchange. Each instrument has its own quirks and nuances that you’ll need to learn to be successful. For example, stocks are typically traded on exchanges such as the New York Stock Exchange (NYSE) or Nasdaq. In contrast, currencies are traded on forex markets. It’s essential to do your research before you start trading to know what kind of market you’re getting into.


Is Day Trading Right for You?

Only you can answer this question. Day trading isn’t for everyone—it takes nerves of steel and split-second timing (not to mention deep pockets). However, it can be an exciting way to make money if you’re up for the challenge and willing to do the work.

About the Author
119 posts
Joe Kelly

Joe Kelly is a versatile entrepreneur with a passion for day trading, product design, and real estate investing. As the creator of My Investing Club's flagship course, the Day Trading Jumpstart Accelerator, Joe has made a name for himself in the financial world since he began trading the market in 2015. Specializing in options, large cap day trading, and swing trading, Joe possesses a wealth of knowledge and experience in small cap stocks, which was his primary focus for the first five years of his trading career. This expertise has led him to mentor countless individuals, sharing his insights and strategies for success. When Joe is not busy making strides in the financial sphere, he can be found cooking up some of the most delectable steaks and smoking mouth-watering, Texas-style BBQ. A man of many talents, Joe enjoys playing guitar and woodworking in his spare time. Family and outdoor activities play a significant role in Joe's life. He loves spending quality time with his wife and children, engaging in a wide array of outdoor pursuits such as fishing, bike riding, hiking, swimming, skiing, tubing, and volleyball. Joe's enthusiasm for everything outdoors and his diverse range of interests make him a well-rounded individual, both in the professional and personal realms.