Being a day trader has its own pros and cons. The pros of being a day trader is that you are your own boss. Your earnings are determined by how good you are, and the earnings potential is basically unlimited.
Cons are that day trading is very difficult. You might end up with a loss after a day of trading and there are no guaranteed pay days. We will dive more deeply into these topics in this post.
You get to be your own boss
The first thing that being a day trader is like is that you get to be your own boss. Nobody is telling you to wake up at a certain time every morning. It is up to you. If you feel like taking a day off in the middle of the week, go ahead.
Being your own boss comes with negatives as well. You will need to be disciplined about your daily schedules.
Nobody will call you out from lunch break, if you decide to have a little bit longer break, that’s fine. You are the boss, you set the rules, you are the only one suffering if you miss out on a good trading opportunity because of this.
Your performance determines how much money you make
Instead of being paid by hourly wage, as a day trader, your salary is completely based on your own performance. Nobody is going to watch over your shoulder. All is up to you.
If your strategy is not bulletproof and back-tested, the one who is losing is you. Not your boss, you will take the hit. Day trading comes with freedom, but also with a lot of responsibilities.
I have a post about what are some realistic returns you can make as a day trader. You can read it here.
You can work from anywhere
With just an internet connection and a device to execute the trades, you can basically work from anywhere. That could be your own home or across the world at some beach in Thailand. Whatever you prefer, day trading is not tied to a certain location.
One thing to keep in mind is market hours. If you are doing your trading from the beaches of Thailand, or any other country in a different time zone, you might end up spending your nights trading.
This depends on the markets you are trading. The US stock exchanges are open in US hours and that might be a problem if you live on another side of the world. If you trade forex or cryptos, this might not be as big of a problem.
You need to learn to manage your emotions and stress
Day trading is a very stressful career path to go in. You might end up losing a lot of trades in a row, going days or even weeks without making any profits. You need to have a proper risk management system and be determined enough to follow your strategies even if you face multiple bad trading days in a row.
One option is to set yourself limits, for example, if you lose 3 trades in a row, call it a day. Take the rest of the day off or look at your trades, where did you go wrong.
Day trading is easy to start but difficult to master
Anybody with an internet connection and a device to execute trades can become a day trader. However, it is very difficult to be constantly profitable as a day trader. Mastering day trading, like any other skill takes numerous hours of studying, trial, and error.
Eventually, if you stick with learning, you might become a profitable trader. It might take months for some, years for another. Depends on your past knowledge, strategy as well as mentality.
Being a day trader comes with a lot of stress and uncertainty, since you don’t really know how much you will make in the next week or month. You might even end up with a losing month.
It also has its own perks, such as the freedom to work when you want to, where you want to, and if you feel like taking a day off, it is all up to you.
One option for trading is algo trading. This basically means that you have software that does the trades for you, according to pre-set rules. I have a post about algo trading as well. You can read it here.
Hopefully this was helpful to you, have a nice day.
This is not financial or investing advice. Some estimates say that 95% of day traders lose money. Always do your research before risking your hard-earned money.