8 Ways to Nail the Day Trading Business for a Wealthy 2023
In a perfect day trading world, many traders dream about a daily 70% win rate. Yet, winning a lot of your trades doesn’t mean you’re a profitable day trader. Many experts aren’t too far off when they say day trading is a sweet science.
But, how can you become a successful day trader? Can you retire comfortably making your dream a reality? There isn’t a set formula.
Yet, there are some tactics you should follow to get a hang of the sweet science of day trading. Not sure where or how to start? We’ve got you covered.
Here are 8 things you should do to run a successful day trading business.
Learn All the Basics About Day Trading
Before getting started, you should learn all about day trading. What is day trading? Can you day trade on any market?
When you day trade, you buy and sell a stock on the same day. If both transactions aren’t carried out on the same day, you can’t call it day trading.
Some think day trading is exclusive of the stock market. But, you can day trade in any market such as Forex, Penny Stocks, among other investments.
Like any business, your success will depend on your business plan. How much money do you need to start day trading? What are the typical day trading costs?
Besides the social media posts, you might’ve seen from day traders trading on a beach. There is a lot more to this business than the fancy lifestyle. How much money can you risk?
Are you considering getting into day trading part time or full time? What market are you going to be day trading in? These are some of the questions that can guide you in developing the right plan for your business.
Learn from Other Day Traders
No one has day trading all figured out. Every day trader has their own routine and style. Follow other traders on social media, day trading websites and read about what they are doing to achieve their trading goals.
All of them have been in your shoes and share their experiences. Consider reading books like the 10-minute millionaire to learn trading strategies that have proven successful for other traders.
Set Your Daily Game Plan
Besides knowing about the markets and strategies, a trader is as good as their daily game plan. You must set your daily strategy beforehand. Don’t try to wing it because your win rate will go down the drain.
Your game plan should include your entry and exit points for your trades. Also, you should consider adding your possible approach if it doesn’t go as planned. Setting the right daily game plan will give you the best chance at achieving high profitability.
Eat and Breathe Discipline and Patience…
Yes, you read that right. Discipline and patience are a must in day trading. You might be thinking but, how can you relax when trading is an adrenaline rush. Many newbie day traders panic when their trade goes south.
A successful day trader always stays disciplined and sticks to their plan. Do your homework and don’t skip anything about your trade. Learn everything there is to know about the stock before adding it to your plan.
If you don’t stay disciplined to your process, your win rate may go down the drain while your risk ratio will skyrocket. A successful day trader achieves a balance between these two. As you keep day trading, you will learn so much about the market that you will spend more time trading and less researching.
Set Your Trade Limits
A successful day trader sets their entry and exit points. You can do this by using limit orders instead of market orders. Using this type of order will allow you to control the buy and sell price of the stock.
Keep in mind that you must set realistic entry and exit points. Remember that the order won’t be executed if the stock doesn’t hit those prices. Day traders start executing their orders as soon as the market opens.
But, if you’re a newbie day trader it’s recommended that you survey the market when it opens for the first 15 to 20 minutes. Remember that the first trades of the day will cause volatility in the market prices.
Take Baby Steps Before You Start Running
So you developed your business plan, you decided to put 10,000 to 30,000 dollars toward your day trading account. Don’t fall into the trap of going all in on your first trades. It’s recommended to start small and work toward big trades.
The best day traders risk between 1 to 2 percent of their account on every trade. As a newbie, it may be difficult to achieve such a low-risk ratio at first. When you are getting started, it’s recommended to focus on 1 or 2 stocks in your day trading session.
It will work as your test drive into day trading. Don’t forget to learn everything there is to know about these stocks before placing your trades. Stay patient and get the hang of the process to become a rockstar day trader.
Ripoff the Band-Aid! Always Be Realistic
Day trading success comes down to profitability. Some day traders become too optimistic about their trades. In this business, you must keep your emotions in check and be realistic about your profits.
You might love what the company is doing to change the industry. But, you should get rid of them if their numbers aren’t turning in the right profits.
Can You Establish a Profitable Day Trading Business?
Yes, you can establish a profitable day trading business. It will all come down to your game plan and execution. Remember to do your homework — a day trader is as good as their knowledge.
Focus on your trading goals and how to make them happen. If you possess in-depth knowledge about a certain market, it’s recommended that you start day trading in that market.
Don’t sell yourself short or get bummed due to a hit and miss on your first trades. Stay patient and committed to building the day trading empire you have been dreaming about.
Want to learn how much your trading platform might cost you? Read our article to find out. Also check out how to invest in stocks for beginners.
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