Is it possible to become rich by stock trading? Do people make enough out of day trading?

Yes, it is possible to make money in stock trading. Many people have made millions just by day trading. Some examples are Ross Cameron, Brett N. Steenbarger, etc.

But the important thing about day trading is that only a few can make money out of day trading and the rest end up losing their entire capital in day trading. The number of successful people is very less even though they have good knowledge of the stock market. Day traders do tend to lose and no trader is having a 100% success rate. But all the successful traders have one thing in common that they follow a system:

Rule 1:They never over trade.

Rule 2:They always has a set target and stop loss.

Rule 3:They trade only when their trading conditions are met.

Rule 4:They understand market psychology.

Apart from following a system, day traders need a strong knowledge of technical analysis and fundamental analysis. Experienced traders always analyze their mistakes and trade only when their setup is available in the market. If anything goes out of the plan, then they close their trade and book the losses.

One must understand that the Stock market is influenced by big players like hedge Funds, Mutual Funds, FIIs, DIIs, etc. They are considered to be market movers and market makers. There is a minority of successful traders group that can take money home because they understand the psychology of the market.

One must be consistent in his or her investment to create wealth for themselves. Never take any trade impatiently. If you start buying stocks the way you buy your vegetables, then no one can stop you from creating wealth. Discipline is the key ingredient of any profitable strategy and patience is the quality of discipline and most of the people who enter the market have lack discipline and patience.

It is very obvious for day traders that their strategies do not work every day, so they adopt the market conditions and have planned their strategies as per the market conditions. On must never trade with the money that they need as they can end up wiping their trading account.

One must understand the difference between stock trading and day trading. Stock trading is done based on fundamental and technical analysis and the psychology behind investing in stock is to create long-term wealth. Day trading is done based on price action and traders want to earn money on the same day and they have to exit the trade either with a profit or loss.

The big players in the market focus on risk management whereas retail traders focus on profits and they end up taking leveraged trade which turns out to be a disaster for most traders. On the other hand, if we focus on a 2% risk on our capital then we will still be there in the market after consistent losses. Professionals focus on how much they can lose and if they are going to trade tomorrow whereas newbie focus on profits and how they are going to spend their profits.

A person spends 12 years in school and then 3-4 years to get a college degree which will fetch them around 20K-30K per month but they all expect the market to give them returns from day 1 which is not possible in other fields. Greed and Fear are the two worst enemies of day traders and if you can’t control your emotions then you must avoid day trading and start investing to meet your end goal.

You can be rich by stock trading or day trading and there are a lot of examples who are successful in day trading but it will take a great understanding of the market, in-depth knowledge of concepts and your psychology and controlled emotions will lead your way to glory.

Why do so many of us have such poor attitudes toward money? There are a few convincing cases you can make: Not enough education, too much information, confusing messages from the media or simply a lack of interest.

Whatever the reason, it’s clear that young people aren’t doing the single most effective thing that will make them rich: Investing in the stock market.

According to a recent Gallup poll, only 37% of young Americans ages 35 and under said they owned stocks between 2017 and 2018, compared to the 61% of people over the age of 35 did own stocks.

Opening an investment account gives you access to the biggest money-making vehicle in the history of the world — and you don’t have to be rich to do it. Many account providers will waive minimums (the amount required to open an account) if you set up an automatic monthly transfer.

Invest now — you’re not getting any younger
What if you had started investing $10 per week five years ago? Assuming an average return of 8%, you’d have thousands of dollars today— all from investing a little more than $1 per day. Think about that $10 a week. Where did it go, anyway? If you’re like most, you probably spent it on Uber rides and Frappuccinos.

Despite wild rides in the stock market, the best thing you can do is to think long-term and start investing early:

If you invest $10 per week: After one year, you’ll have $541; after five years, you’ll have $3,173; after 10 years, you’ll have $7,836.
If you invest $20 per week: After one year, you’ll have $1,082; after five years, you’ll have $6,347; after 10 years, you’ll have $15,672.
If you invest $50 per week: After one year, you’ll have $2,705; after five years, you’ll have $15,867; after 10 years, you’ll have $39,181.
Stop making excuses
Although most people are limited by circumstances, most will never get rich simply because they have poor money practices.

If you’re in your 20s or early 30s, there’s still time to set aggressive investment goals. The first step is to understand what your excuses (or what I call “invisible scripts”) really mean.

Invisible script: “There are so many stocks out there, so many ways to buy and sell stocks, and so many people giving different advice. It feels overwhelming.“
What it means: This is code for: “I want to hide behind complexity.” Any new topic is overwhelming (i.e., diets, workout regimens or parenting). The answer isn’t to avoid it — it’s to pick a source of information and start learning.
Invisible script: “I don’t want to be the person who buys into the market when it peaks.“
What it means: You already know you can’t time the market, but you just don’t understand it. You can make this problem disappear by automatically investing each month.
Invisible script: “I haven’t invested in anything because there are so many different options to put my money in over the long term (i.e., real estate, stocks, cryptocurrency and commodities). I know I should invest, but stocks don’t ‘feel’ comfortable.“
What it means: The great irony is that you believe “control” will help your investment returns. In reality, you’d actually get better returns by doing less. The less control you have, the better. The average investor buys high, sells low and trades frequently (which incurs taxes). All of this cuts your returns by huge amounts.
Invisible script: “Due to my lack of knowledge and experience in the stock market, I don’t wish to lose my hard-earned money.“
What it means: Ironically, every day that you don’t invest, you’re actually losing money due to inflation. You’ll never realize this until you’re in your 70s, at which point it’ll be too late.
Invisible script: “Fees are a big part of it. I only have a small amount to invest, so trading fees can make a big dent in my returns.“
What it means: It’s totally mystifying how people think “investing = trading stocks.” Oh wait, no it isn’t — every dumb commercial and app pushes this agenda. When you follow my advice, your fees can be really low.
Invisible script: “I ordered a small coffee instead of a large, so I’m actually saving X dollars a day. Am I adulting?“
What it means: Not really.

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