Day trading for a living can be a pretty difficult way to earn. You have to start with a rather large quantity of money to even get going, and then you have to survive through the steep learning curve in order to even start becoming profitable, and earning a living. This can often take 6 months to a year, and most traders don’t make it through which leads to a 90 percent or higher failure rate for those who attempt day trading.
The reason why the learning curve is so steep is because you have to learn about how the market works, how to actually use trading software, and how to read and analyze stock charts. This is a fairly broad range of information that you have to become intimately familiar with before you go into live day trading. There are fundamental and technical analysis techniques to learn so that you can make good stock picks before the trading day even begins. You have to learn your trading software inside and out so you aren’t fumbling around when it comes time to trade, potentially costing you a lot of money. And of course, you also have to understand stock charts, and how to read patterns as they develop in real time. Taking all of this knowledge and moving it to a real time environment where real money is on the line can be a difficult transition to make.
You also have to have a decent amount of cash to begin trading. The SEC requires a minimum of 25,000 dollars in order to open a day trading account which will give you a 4:1 margin. You also should have a fairly comfortable cushion so that when you take the inevitable losses, you don’t go below that 25,000 mark. This could mean at least 30,000 or more. Beyond that, if you plan on doing this full time, you have to consider living expenses for a year. This amount will obviously vary depending on your lifestyle. Either way, it will require anywhere from 50,000 to 100,000 dollars to get going, and to stay in the game for the long wrong. Many traders fail simply due to being under capitalized.
This may seem difficult in both educational and financial requirements, but the rewards are well worth it. A good day trader can net well into the 6 figures a year range, and the actual expense of learning is far lower than that of any traditional education even if you end up losing your entire trading account.
