How to Become a Part-Time Day Trader? Profitable Trading

Trading concepts

How to become a Part-Time Day Trader?

Part-time day trading is an idea that is attracting more and more attention across the globe. It is alluring because who in this world wouldn’t want to earn some extra money. Additionally, it offers flexible working hours as well as working from anywhere in the world. 

So, if you are looking to become a part-time day trader and want tips and ideas on how to start part-time day trading, then you are on the right platform. Because we are going to give you a roadmap for becoming a part-time day trader. Let’s start without wasting a second!

What is day trading? 

Day trading, as the name suggests, refers to trading throughout the day but never keeps open trades overnight. Day traders keep buying and selling financial instruments such as stocks, cryptocurrencies, ETFs, etc. multiple times. They actually seek to capitalize on small price fluctuations to make money. Small profits from small fluctuations become significant gains at the end of the day because day traders execute trades multiple times. 

Moreover, day traders are different from active traders or long-term traders. They don’t carry an open position until the next day. In other words, day trading revolves around trading during the day and capitalizing on daily price movements of financial instruments. However, it is important to keep in mind that day trading isn’t an easy way of trading. You need a lot of knowledge, skills, and a particular mindset to be successful as a day trader.

What is part-time day trading?

Differentiating between part-time day trading and full-time day trading is a tricky task. Why so? Because trading isn’t a profession that follows the trajectory of other full-time or part-time jobs. The reason is that trading doesn’t require you to initiate trades one after another. In fact, not even full-time traders actively execute traders throughout the day from 9 am to 5 pm. 

Moreover, trading is about quality. It isn’t about quantity. That means you need to seek the best trading opportunities rather than executing trades again and again. All successful traders prefer to sit out even for days if the market doesn’t present a good opportunity. This is the way to do it and this should be your approach as well. However, it is important to note that not executing a trade doesn’t mean you aren’t working. You need to assess and analyze the market continuosly to get yourself ready for pouncing on any opportunity the market sends your way. 

Simply put, part-time day trading or full-time day trading doesn’t necessarily refer to how much time one spends in active trading. Instead, part-time day trading refers to trading for limited hours while having other obligations as well. Conversely, full-time day trading refers to trading while having no other obligations such as a full-time job.

How to become a part-time day trader? 

If you are looking to become a part-time day trader, then the following tips and tricks are going to make your quest seamlessly easy. 

1. Start with conducting a self-assessment

Part-time day trading is a good idea to make some extra money while doing a full-time job for a steady income. However, it is important to conduct a self-assessment before entering this profession. As we have already discussed, day trading requires knowledge, skills, and a particular mindset. You need knowledge and skills to conduct technical analysis. Whereas, a particular mindset is required to take a risk. Therefore, it is important to assess yourself and know whether you are determined enough to learn and enhance your skills. You also need to assess whether you can take a risk or not? This assessment helps you find out whether part-time day trading suits you or not.

2. Arrange sufficient capital

Now, if you are determined enough to learn about trading and also have the required mindset, you cannot trade without a capital. Moreover, trading doesn’t ensure consistent profits for anyone even the expert traders don’t win all the time. There may be long periods when you won’t make any profit. Therefore, it is important to risk capital that you can afford to lose. However, part-time day traders have another steady source of income. So, their chances of financial ruin are comparatively low. 

Now the question is how much capital do you need to make a considerable profit from part-time day trading. There is no absolute figure we can quote here as an answer to this question. However, it is best to have at least a capital between $20,000 to $25,000 in our opinion.

3. Start learning about financial markets

Financial markets work in their own way. No one can dictate the course of the markets. That said, it is important to understand how markets behave. Understanding factors such as trading hours, impacts of major news events, and so on can be crucial for successful part-time day trading. In fact, you need to build a strong knowledge base to cope with how markets behave. 

4. Choose an instrument for trading

There are different financial instruments that you can trade. For example, you may choose between stocks, forex, cryptocurrencies, commodities, ETFs, futures, and so on. Choosing any one or two is better because all instruments trade differently and therefore, you cannot develop trading strategies for all of them. Choose one or two, and understand their characteristics, and trading requirements. It helps you build a good trading strategy. 

5. Build a trading strategy

A good trading strategy is a prerequisite to successful trading and part-time day trading also requires one. You can start with a simple trading strategy that is easy to execute. Later on, you can move to more complex trading strategies as your confidence and experience grow.

6. Prepare your mind

Trading isn’t all about trade executions, figures, charts, or patterns. It also heavily relies on your state of mind. You can get into a perfect state of mind for trading by sticking to a schedule, studying markets, expanding your knowledge, and honing your skills. It is necessary even when you are a part-time day trader. 

How to be successful as a part-time day trader? 

Getting into a profession isn’t always difficult. The difficulty lies in achieving success in that profession. You can easily become a part-time day trader if you have some money to trade. However, becoming a successful part-time day trader won’t be easy. Here are a few tips to achieve success in your part-time day trading endeavor. 

  • Strictly follow your trading strategy and trading plan. It helps you stay on track, set realistic profit targets, and get profits.
  • Look for quality rather than quantity. Don’t try to maximize the number of trades. Instead, try to maximize gains. And this is only possible when you look for quality, not quantity.
  • Trade only patterns you are an expert at. There are hundreds of patterns out there that you can trade. However, you won’t be successful until you trade only patterns you are an expert at.
  • Don’t risk too much capital on one trade. This is the key. You need to keep in mind that you may lose your entire capital if that trade went wrong. Therefore, never trade too big and wait for opportunities. 
  • Never stop learning and honing your skills. Knowledge and skills are among the factors that decide your destiny in trading. Therefore, never stop learning and honing your skills. Continuous improvement certainly leads to success in part-time day trading. 

What do you need to keep in mind before opting for part-time day trading? 

As we mentioned a short while ago, part-time day trading is alluring. However, you must keep in mind a few things before opting for this job. The lives of traders in general and day traders, in particular, aren’t as glamorous as it seems. You cannot fathom the depth of a lake until you enter it. Day trading can be overwhelming for many people. Why so? Because getting success in day trading often requires monotonous as well as countless working hours in front of a computer screen. It also requires you to conduct a lot of painstaking research. That’s quite a big ask when looking to become a part-time day trader.

Furthermore, it also isn’t an easy course that ensures easy money. You cannot predict how much money you will make or will you be able to make any money at all. That means you need to understand the fact that trading isn’t the profession that guarantees success to everyone. Simply put, it is always a better idea to consider all those things. This isn’t to discourage you. Instead, we are giving an honest account of what you may encounter later on.

However, if you are determined and committed, then starting part-time day trading isn’t a bad idea at all. Part-time day trading enables you to gain experience and educate yourself about financial markets while hanging onto your current job or business offering steady income. 

Russell Crane

Russell Crane

Russell is an Algorithmic & Technical Analyst Trader @ PatternsWizard.
His passion is to share his knowledge about TA, patterns & more. Why hope for your trading to work when you can precisely know the performance stat of every pattern?

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