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Day trading tips for newcomers to start part-time

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Many people have an interest in day trading but do not have the desire or circumstance to make it their full-time career. By starting off slowly and integrating day trading into your routine on a part time basis you are giving yourself an opportunity to earn money, learn the industry, make mistakes, and discover recovery strategies, all in a lower risk manner than if you were relying on this as your full-time profession. If you are considering taking this path, then you should also consider researching common best practices as well as the pitfalls commonly experienced by others in the field.

Day trading can be a very lucrative way of making more from your money. Buying and selling financial instruments either once a day or multiple times a day might get you some high profits, but it has some inherent risks. For newcomers to the day trading game, those risks can be very easily missed, and that can expose you to losses that would otherwise have been avoided. If you understand the basics of day trading, you immediately become more likely to make a profit. If you’re being drawn to day trading as a potential means of making more from your money, then here are some of the most useful tips to remember.

Adjust your schedule

Figuring out how to balance your full-time job with being a part-time trader will take some finesse. Since the market is only open during specific hours you will need to be conscious of those hours and what that means for your professional responsibilities. You can learn about taking advantage of premarket trading hours as a strategy to both give yourself an edge and be available to your full-time job.

While being a part-time trader is completely respectable do not fall into the habits of being a casual trader and understand the difference. The main difference is your mindset. Trading part-time means that you are still a dedicated and disciplined participant but that it is a piece of your pie and not the whole thing. While casual trading predominantly refers to those who trader whenever the mood strikes or the time to do so becomes available.

Your expectations will also have to be adjusted to line up with your part-time status. You cannot expect full time profits from part time work. Having said that, the more you get into it and identify market and trader trends, the more efficient you will become. Realizing that only a few specific hours of each day will yield the best results for your specific goals can eventually lead to larger profits while still maintaining part-time labor.

Avoid system hopping

There is nothing wrong with taking your time to identify which trading style best suits your capabilities and your goals but try to avoid bouncing around too much. There is a sweet spot between figuring out your strategy and giving up and abandoning it if it does not yield instant gratification. It is often recommended to part-time traders to pick one system and then make a contract with yourself that you will explore that system exclusively for the duration of your contract. The two broad categories you will be deciding between are day trading, and swing trading.

Swing traders have the benefit of having time in their side in terms of not being restricted by the hours of the market. While day trading presents the challenge of a time clock. Day trading will require more attention throughout each day and decisions will have to be made inside each days’ market hours. Audit both your weekly schedule and your personality in an honest capacity to help you determine while style makes the most sense.

Know the markets

When it comes to day trading, knowledge is power. You’re going to want to update yourself on all of the basic trading processes, but you also want to stay current on market news. The stock market can rise or drop for an incredible variety of reasons, so you need to be up to date on what’s happening in the world and how it might affect currency and stock prices. You might find that you have seen breaking news that will have an effect that others haven’t considered, and that means being able to position yourself for greater profit potential.

Know your capital

You need to have a very strict awareness of how much of your money you are willing to risk. While big profits are certainly achievable with smart day trading, losses can be sudden and very damaging. High profile traders traditionally invest just 1% or 2% of their overall budget on each trade. This not only minimizes risks but also means that as your profits grow so too can your investment amounts. Know what you are prepared to lose and minimize the danger of not being able to trade at all.

Commit

Day trading will take up most of your working day. If your time is limited, then you will not have the flexibility to make the day trades that will yield the biggest profits. You need to be able to track the markets that you’re trading in, and if you’re not watching then you may miss the best opportunities. The key to being a successful day trader is being able to invest quickly, and if you’re not willing to put in the hours, then your progress will be much slower. Make sure that you get a feel for the brokers that you use, and make use of the many available platforms that come with tools and resources for improved day trading investment. Platforms can help transform the success of your day trading venture and could be the key to making faster profits over a shorter amount of time.

Don’t race

If you’re just starting out as a day trader then it’s a good idea to start part-time and slowly to get a feel for the way that the markets move. Begin by only trading on one or two stocks every session. If you try to do too much too soon you will make it much harder for yourself to keep track of what’s happening. You will also find it much easier to spot those high-yield opportunities if you are not being bombarded with data regarding too many alternative investments. You might even consider trading in fractional shares to reduce your risks even further.

Your day trading will only be a profitable activity if you do your research. Many people fall into the trap of thinking that they can become a day trader part-time, but make no mistake: it is a full-time job. The more that you treat your day trading seriously and take the time to learn as much as possible about the market, current trends, and what affects the prices on an evolving basis the more likely that you can generate a profit that will compensate for the hard work that you put in.

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