Andrew Aziz - How to Day Trade for a Living

In this book, I explain the fundamentals of day trading and how day trading is different from other styles of trading and investing. In the process, I also describe important trading strategies that many traders use each day. This book is deliberately short so readers will actually finish reading it and not get bored halfway through and put it to one side. We are all distracted by Internet diversions, emails, Facebook or Instagram notifications or the dozens of other apps that we have on our smartphones or tablets. Therefore, this book is concise and it is practical.

If you are a beginner trader, this book will equip you with an understanding of where to start, how to start, what to expect from day trading, and how you can develop your own strategy. Simply reading this book will not make you a profitable trader. Profits in trading do not come from reading one or two books, but, as I will explain later, profits can come with practice, the right tools and software, and proper ongoing education.

Intermediate traders may benefit from this books overview of some of the classic strategies that the majority of retail traders use effectively. If you dont consider yourself a novice trader, then you may wish to jump ahead and start reading at Chapter 7 for an overview of the most important day trading strategies. However, I encourage you to skim through the earlier chapters as well.

In my opinion, the most important lesson that you can learn from reading this book is that you will not get rich quickly by day trading. Day trading is not similar to gambling or playing the lottery. This is the most important misconception that people have about day trading and I hope you will come to the same conclusion after reading this book. In fact, statistically speaking, 90% of people who start day trading fail and lose their money. It is easy to be one of those nine out of ten people. It is very easy.

This brings you to my first rule of day trading:

Rule 1: Day trading is not a strategy to get rich quickly.

A very common misconception that people have about day trading is that it is easy - you buy stocks, and when they go higher, you sell them for a good profit. Its that easy.

Well, if it were that easy, then everyone would be a successful trader. You must remember that day trading is difficult and will not make you rich quickly. If you have this misconception, and if you want to get rich quickly and easily in the stock market, you should stop reading this book right now and spend the savings that you put aside for day trading on a nice family vacation. It would be much more satisfying to spend your money that way, rather than losing it in the stock market.

In day trading, you will be competing with the sharpest minds in the world. The market is a massive crowd of traders, with each trader trying to take money from the others by outsmarting them. The main objective of day trading is to take money from other traders while they are trying to take yours. Thats why its such an intellectually intense business. You do not generate money in the stock market. The only reason there is money in the market is that other traders have put it there. The money you desire to win belongs to other traders and they have no intention of giving it to you. That is why trading is such a hard business.

This leads to my second rule of day trading:

Rule 2: Day trading is not easy. It is a serious business, and you should treat it as such.

You can succeed in day trading only if you handle it as a serious intellectual pursuit. Emotional trading is the number one reason traders fail. You will need to practice self-discipline and defensive money management. Good traders watch their capital as carefully as professional scuba divers watch their supply of air.

In day trading, simply being better than average is not good enough. You have to be significantly above the crowd to win in day trading. Unfortunately, day trading often appeals to impulsive people, gamblers, and those who feel that the world owes them a living. You cannot be one of them and you should not act like they do. You must start developing the discipline of a winner.Winners think, feel, and act d iff erently than losers. You must look within yourself, discard your illusions, and change your old ways of being, thinking and acting. Change is hard, but if you wish to be a successful trader, you need to work on changing and developing your personality. To succeed, you will need motivation, knowledge, and discipline.

So, then, what is day trading? In reality, day trading is a profession, very much like medicine, law and engineering. Day trading requires the right tools and software, education, patience and practice. You will have to dedicate countless hours reading about trading styles, observing how experienced traders are trading, and practicing in simulator accounts to learn how to trade with real money. An average successful day trader can make between $500 and $1,000 every day. Thats equal to $10,000 to $20,000 a month (based on about twenty trading days in a month) which equals $120,000 to $240,000 a year. So why would anyone expect a job that pays this well to be easy? Doctors, lawyers, engineers and many other professionals go through years of school, practice, hard work and examinations to earn a similar income. So why should day trading be any different?

So if it isnt easy and doesnt get people rich quickly, why would you want to day trade?

What makes day trading attractive is the lifestyle. You can work from home, work only for a few hours each day and take days off whenever you wish to. You can spend as much time as you want with your family and friends without requesting vacation time from a boss or manager. You are the boss. Since day trading is a form of self-employment, you are the CEO and you make the executive decisions for your business.