Start from the Basics: Day Trading For Dummies

Trading Up Blog

Start from the Basics: Day Trading For Dummies

Day Trading For Dummies

If you are an investor who is interested in getting started in day trading, you may be confused about how to begin.

Day trading for dummies lets you take advantage of this lucrative opportunity by providing you with all of the inside information that you need to make a smart financial move.

The first thing you need to know is what day trading means. In simple terms, day trading is a trading strategy in which investors hold securities for just one day. Traditional trading has investors holding their securities for weeks, months or years.

Next step will be the requirements to become a successful day trader. Starting, of course, from the beginning.


The securities in question include stocks, futures, derivatives, stock options and even currencies. The only requirement to start day trading from dummy level is that you choose a security that is traded on an exchange.

The initial price that you pay to purchase the security is not typically a concern. Day traders make money off of the volatility of their investments.

Don’t forget your day trading software!

Day Trading for Dummies – Pros and Cons

Risk associated with day trading is both high and low. The fact that you could be spending a lot of money on securities means that there is an element of risk, but there is less of a chance that you will lose big when you are only holding the security for a day.

The negative aspect of day trading is the fact that your securities are only given one day to perform. If you do not make money in one day, you are not going to make money on the investment.

Instead, traditional investment techniques allow investors to wait out the market to earn.

Helpful Terminology

• Ask Price/Offer

This is the lowest possible price that a seller will take for a security that you would like to purchase. If you are looking for a security to purchase, the ask price is its sale price. One of the most important terms for day trading for dummies. 

• Bid Price

This is the highest price that you as a buyer would be willing to spend to purchase a particular security.

• Intraday

Something that happens within the trading day. This is often used to describe the price changes that occur in one day.

• Limit Order

This means that you dictate the maximum price that you will pay for a security, and the order must adhere to these price limits. It also refers to the lowest selling price when you are the seller.

• Liquidity

This refers to how quickly a security can be converted into cash. It also refers to your ability to transfer securities.

• Margin Account

This brokerage account is used to fund the purchase of securities when you do not have the cash available to do so.

• Market Indicator

These are indicators of the direction that the market is taking that are evidenced through technical data, a general feeling from other investors or economic factors. this is an important term for day trading for dummies.

• Market Order

You place this type of order when you would like to purchase or sell securities at the market price. this is a very popular term for all that are learning day trading for dummies.

• Scalping

Some day traders use this strategy to make substantial profits when the price change of a security is small. This means that you make many transactions each day to profit a small amount on a high volume of trades.

• Short Selling

This day trading strategies means that you sell securities that you are only borrowing from a brokerage firm. You will then purchase the securities back for a smaller amount in order to give the securities back to the brokerage.

• Long Selling

This strategy in day trading for dummies means that you buy a large number of securities in hopes that the price will increase.


If you are reading day trading For Dummies, your primary goal is probably to find out how this technique can benefit you. Here are the benefits of day trading.

  1. Your investments are not subject to overnight risk. Market prices can fluctuate by as much as 10 percent overnight. This means that people who use traditional trading tactics stand to lose a lot in one day, but you avoid this uncertainty by buying and selling within the same day.
    This is one of the most important techniques for day trading for dummies. 
  2.  You can leverage your investment It is important to understand that leveraging is not a technique that should be used by beginners. If you have some day trading experience, you may be able to get much more than your capital margin from a broker. You can multiply your profits by leveraging. Day trading stocks are very important.
  3.  Day trading is an activity that lets you learn as you go. You will start to learn about trading patterns (like candlestick and triangles) and how you can use effective techniques to make money as soon as you start day trading. It takes a short time to get the hang of day trading, so your time is well spent.
    This is a very popular way to explore the day trading for dummies. 
  4.  You can work at home as a day trader. There is no need to rent an expensive office space when you engage in day trading. You do not have to pay employees or answer to a boss. Anybody can learn how to day trade, and this investment option is even a lucrative way for people who are unable to move around to make money.
    You can start day trading for a living!
  5.  You get to feel like you overcame a challenge when you earn. Understanding the market and making smart short-term investments requires the use of strategy. Many people feel the thrill of success when they are able to make money through day trading. These are some of the most important tips and techniques for Day Trading for dummies.  There are a lot of day trading for dummies pdf free download available on the net.

Day Trading for Dummies – Other Useful Links

Top Expert Guides
Recent Articles

Subscribe to The Real Trader Newsletter

Get our latest insights and announcements delivered straight to your inbox with The Real Trader newsletter. You’ll also hear from our trading experts and your favorite TraderTV.Live personalities.