How Much Can Realistically Be Earned with Day Trading?

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By Jacob Maslow

To answer this question, one must understand that earning through trading depends on a myriad of factors, starting from the funds invested to strategies involved in the application of a variety of risk management practices. Moreover, losing money when day trading is easy due to traders mostly depending on the day’s movement for making profits. Day traders do not hold stocks overnight which leaves them with only a few hours to exit.

Therefore, it is crucial to use the given time accordingly and manage stocks with deliberation. However, this does not mean that day trading does not benefit its investors. On the contrary, which is why many traders continue making money by using this particular strategy, seeing as those who trade with discipline and avoid taking too many risks can earn a pretty penny. For instance, not risking more than 1% of the portfolio for a trade is always a safe move. This means that if you are investing $10,000, you must avoid losses beyond $100.

There are countless strategies that experienced traders rely on, but most importantly one should stick to the strategies and abide by the routine without fail in order to survive day trading in the long run. And, those who do, will gain profits to show for their efforts.

How to Start Day Trading?

If you have never traded before, you must prepare yourself for the rough road ahead of you. No matter how well you do your research before making a trade, there is no way to know precisely what happens next. That is when strategies pitch in. Safe trading means knowing how much you can afford to lose and creating stop losses accordingly. If you fix your stop loss at 1% of the invested portfolio, you can keep the profit margin at 1.5%.

Also, pattern day traders must oblige to the rules the FINRA (Financial Industry Regulator Authority) sets for them. For instance, if you are a margin trader with frequent trade records, you must maintain a minimum of $25,000 in your trading account. Trading is prohibited when this limit is not met.

In addition, you must need a trading platform along with online applications to keep track of your selected stock trends. Furthermore, you have to include brokerage fees as well as taxes levied on short-term gains to estimate your overall profit. Factoring all costs will help you realize actual gains and determine how much you are earning by way of day trading.

What Factors Influence Profit Margin?

There are various parameters that influence the potential gains of a day trader.

Capital You Can Invest in Day Trading

If you buy a stock worth $10 and invest $100, you can purchase a maximum of 10 shares. Likewise, if you invest $1,000, the maximum stock you can purchase will increase with the fund. With a $1,000 investment, you can buy 100 shares worth $10 each. The profit will differ as well, because the greater the funds invested, the higher the profit.

Market You Choose for Trading

It is up to you, which market you choose for day trading. However, stocks are considered the most capital-intensive asset among other options, such as futures and forex. Hence, you can start with lower investment to realize higher profits when trading with stocks.

Strategies You Choose to Trade with

Depending on your strategy, you can either increase your profits by risking more or earn with patience by playing safe. It is not surprising to find day traders making profits in a matter of days. But in the long run, it is advisable to oblige to a low-risk strategy and stick to it. Gains will come eventually.


It is difficult to make assumptions on how much you can earn from day trading. It could be nothing or it could be millions or even more. What matters is how disciplined you are and how wisely you can manage your portfolio with minimum risk.

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