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How to Start Day Trading: Your Practical Guide



Ever wanted to try your hand at day trading? It’s surprisingly easy to get going – if you know how. So, if you’re thinking about a career in day trading, here’s how to start. 

What Is Day Trading?

Let’s start with the basics – what is day trading, anyway? 

Put simply, day trading means buying and selling assets in a short space of time. Typically, this means selling and buying assets within a single trading day. The goal of day trading is to cash in on price fluctuations. Meaning, you buy when a price goes down, and sell when the asset price rises again. 

There are, technically, no limits to how many trades you can make in a day. Some day traders might only make one or two trades a day, while others make dozens. It all depends on:

  • How much time you can spend on day trading; and 
  • How much you could afford to lose.  

How Much Money to Start Day Trading

So that’s what day trading is, but here’s another big question. How much does it cost to get started? Do you need lots of cash on hand, or is it affordable? 

Well, you can start trading with as little as $500. That’s what makes prop firms so attractive to talented day traders – they make trading accessible. You can get started with a prop firm like Maven Trading for just $45!

That said, there’s a rule you should be aware of, and that’s the “drawdown” restriction. 

Prop firms can only allow traders to “lose” so much capital before they restrict the trader’s account. This limit is the drawdown restriction. When you’re planning your investment strategy, you need to bear this limit in mind.

  • If you reach the drawdown limit, your account may be suspended.
  • There’s always the option to “buy back” the drawdown you lose so you can keep trading. This requires capital, though, so you don’t want to drift too deep into the drawdown limit. Otherwise, you might struggle to “buy back” your place within the prop firm.

Prop firms are supportive. They want traders to succeed. They’ll help you with risk management strategies so you can make impressive trades without falling foul of the drawdown.

The main takeaway is that you don’t need much money to get started. However, it might influence how you actually trade. We’ll cover this below.  

How to Start Day Trading, Step By Step

If you want to start trading, here’s how you should go about it. 

1. Do Your Research

Think about the market you want to invest in. Research it thoroughly. It’s not enough to just have a general idea of how to invest. You need to know your market, and how to respond to fluctuations, before you start. 

2. Know Your Goals and Objectives

What do you want from life as a day trader? This is a key question to ask yourself. Think about the answer carefully. While you’re at it, here are some other points to cover:

  • Know your risk tolerance and stick to it. 
  • Determine what kind of assets (such as crypto or forex) you want to trade. 
  • Be honest about how much time you’re willing to spend on trading. Your time commitment determines if day trading is a good move. 
  • Review your goals regularly to ensure you’re meeting your targets.

3. Set an Investment Strategy

How do you want to invest? Study the different strategies. 

For example, you might try buying and selling based on current trends. Or you might opt for assets that “swing” between high and low prices. Or, you might try exploiting short, sharp market changes.

Consider opening a demo account to get a feel for what works best and what you enjoy. Also, have an “exit plan” or strategy and stick to it

4. Determine Your Limits

Next, set your investment limits. These limits should always be in line with your prop firm’s own drawdown rules. 

Be realistic about what you can spend (it’s usually best to start small). You can always change your limits as you get more experienced and confident in your abilities. Set your price points, stick to them, and learn from every trade. 

 Stock market exchange graph green and red black background

At Maven Trading, we’ll help you set limits as you learn the tools of the trade. We’ll support you in the short and long-term – after all, we’re in this together! 

5. Choose Your Platform

Finally, you need to choose your investment platform. You’ll need some basic tools to do this, such as a laptop or desktop computer, and internet access. 

You can work with a broker or choose a prop firm. A benefit of choosing a prop firm is that you’re not risking your own money. In exchange for a fee, you’re sharing the profits but getting access to their trading tools and resources.

Is Day Trading Right for Me?

So, we’ve covered day trading and how to start day trading quickly. Is it right for you? Well, we can’t give you a firm answer – it’s a personal decision. However, we can give you some pros and cons to think about to help you decide. 

Day Trading Pros

Clearly, day trading can be exciting. Here are some advantages to this trading strategy.

  • If you know what you’re doing, you can make impressive returns on your investment.
  • You might enjoy the intellectual challenges of day trading. It requires skill, creativity, and talent.  

Can you make money day trading? Absolutely. But you need a strategy. And you need to be prepared to take some (calculated) risks. 

Day Trading Cons

Day trading is fast. It’s thrilling. But it’s not without its risks. Here are some drawbacks to consider before you start trading.

  • You may find watching market fluctuations stressful. It’s not an enjoyable trading strategy for everyone.
  • It can be harder to make money if you’re not day trading full-time. Not everyone wants this kind of commitment. 
  • Since it is fast, day trading is volatile. You’re relying on short rather than long-term market fluctuations to make money. The downside is that these fluctuations could cost you money. 

Start Your Day Trading Journey

Do you want to start day trading? We can help. At Maven Trading, we help talented traders make big moves without risking their own capital. From risk management to tips on day trading strategies, we’ve got you covered. 

Get funded today!


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