Young People Who Day Trade for a Living
I’ve spoken about day trading before and how I tried it one summer.
For three months straight, I traded foreign exchange using technical analysis, fundamental analysis and sometimes sheer luck.
I have also mentioned my friend the Shinobi Trader who trades for a living and uses options and forex to trade.
Both are highly leveraged trading instruments and I should remind you that trading leveraged instruments involves risk.
Please continue to the full disclosure regarding trading.
What is Day Trading?
Day trading involves buying and selling a financial instrument at a high frequency.
For example, if you decide to become a day trader of stocks, you would buy and sell several times a day. If you decide to day trade foreign exchange, you would long and short several times a day.
I have met a few day traders.
I knew one who day traded stocks to the tune of one million dollars worth of transactions.
He had losses of about 800 thousand dollars and netted about 200 grand for the year.
Not bad huh?
But I’ve also seen the other side. Personally, I experienced a loss of my entire trading account when I day traded forex.
However, I was able to learn from my mistakes and now I can trade profitably. I learned that day trading is not for me because it was too emotional.
Can I Make a Living Day Trading?
Making a living doing something that does not involve guaranteed money is pretty risky. In terms of risk I would list the following from least risky to most risky.
- Picking up a check from passive income sources
- Working a job
- Day Trading
Obviously there are more ways to generate income that could fit into that spectrum, but this simplified example is just to give you an idea on how risky it is to day trade.
It is possible to lower the risk.
There are ways to trade forex with low risk and any time you learn more about your craft, you are lowering the risk.
Is it possible to make a living day trading?
This trader would say yes.
Mom Day Trader updates the blog with trades that she has made.
On June 4th, 2011, she placed three trades. Two were winners and 1 was a loser. She was able to trade during the day and bring in 200 bucks. Not bad for a half a days work.
Would you consider day trading?
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