In this article, I’m going to talk about the issues that I had when I tried to day trade, specifically Stocks, Forex, and Crypto. I will share my personal thoughts on those markets and what I did or didn’t like about the space. In another article, I have explained why I like trading in Futures and why Futures are Superior Products. If you are an active trader, then I suggest you check it out.
Let’s look at my conclusions, takeaways, and issues with trading Stocks, Forex and Crypto so that you don’t make the same mistakes and learn from them. No one is born a great trader, one learns by trading.
The Stocks Market
When I first started trading stocks I thought there was nothing else that you could trade except for stocks.
One of the big things that were slowing me down or hindering me was the Pattern Day Trade Rule. It’s the rule that you should have $25,000 in your account, and you have to keep it in order to trade actively.
This was a huge barrier for me, and I know that there are ways that you can go around that rule by using brokers outside of the U.S, but that didn’t seem like something that I wanted to do.
Another issue that I had was the low amounts of leverage offered, which would mean that a product had to move a lot in order for me to make any significant amount of money. That would result in the position being opened for a long time, which wasn’t working for me.
Another thing that put me off from trading in stocks was the ability to scan through every day and understand exactly what is primed to move and why. I felt like I was missing a big chunk of information. If you are in some kind of institution or work with analysts, you can have that kind of information available to you, which it’s going to be a huge advantage.
I didn’t enjoy the part of the work where I had to search through every product and manually scan and look for opportunities. It felt like it was a lot of work and more complicated than other markets, so that was a big turn-off for me, but still this is my personal preference.
The Forex Market
It’s really hard to get involved with trading and not to come across Forex trading. When I first encountered it I was blown away by how scammy the market and the people promoting it sounded.
If you love trading with Forex then don’t get offended by what I say. I’m just explaining my experience with it and it doesn’t reflect how the market actually is. I know that it can be a really profitable platform and a lot of people do really well with it.
Almost everyone that I encountered when learning about forex had these ridiculous ideas and sayings. Things like you can make incredible amounts of profit but without any actual facts or explanation. I knew deep down that they had no idea what they were talking about.
There were people that were showcasing these algorithms or bots that you only need to put money and they will make the profit for you. Sadly the forex market has attracted a lot of these scammers which I didn’t like.
The Forex Market is very difficult to trade like a day trader because it’s not regulated. There are so many unrelated exchanges and the information is scattered. Not everyone sees the same things, like the price for example.
The Crypto Market
When it comes to Crypto well let’s say it like this. The Forex Market was always like the Wild West of trading because it’s unregulated and lawless. That was until crypto came into the space and took things to another level.
One thing that I understand and love about Crypto is that I understand that cash is going away.
I really like Bitcoin. There was a time where the volatility was so extreme and it was so directional that I was actively involved. The opportunities were right there and the profits were huge.
Everything I said for the Forex Market being unregulated, transparency issues and scams can be applied for Crypto.
I feel like the resources, the tools, and the platforms that you can trade off are not up to par with what you need as an active trader. I know that this statement might not age well but this has been my experience. There are no Sierra Charts or anything reliable like that that I could use and have a professional quality resource.
Trying to actively trade Bitcoin has been very difficult in my experience. It wasn’t something that I could stick with even though I like the space, it just wasn’t sustainable.
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Day Trade Frequently Asked Questions (FAQ)
Is Day Trading Illegal?
Day Trading is not illegal or unethical, however, it is very risky. Only do this if you are comfortable with losing all the money you intend on investing.
Is it Day Trading if you sell the next day?
By definition, this isn’t considered day trading. If you buy and sell an asset within the same day it’s considered day trading.
Is Day Trading worth it?
Day trading can be extremely profitable but keep in mind that it’s also extremely risky. You can lose all the invested amount in a matter of minutes. On the other hand, if you are good at it you can make more than your entire trading year. Anyway, it’s up to you to decide if it’s worth it or not just be responsible for it.