The best tip among all day trading tips is to practice before one actually invests money. This can be accomplished in a number of ways, including through simulators and testing one's predictions on paper. Learning with fantasy money whether one's bets would have been successful can be the best learning tool available, because success with fake money implies success with real money. If one doesn't understand what one is doing, there is no way for day trading to be successful. Other helpful day trading tips cover topics like when to trade, how to trade, and how to decide what stocks to buy, but nothing can replace a basic understanding of the stock market.
Being a day trader involves taking advantage of daily fluctuations in the price of stock. As small changes can be extremely profitable when buying in volume, one of the best day trading tips is to have the right tools for day trading. One needs to be able to monitor investments constantly. It is also important to have enough money that the cost of trading is covered by the profits from the stock.
Many day traders get emotionally invested in stocks and then cannot make rational decisions about when to sell. This is a psychological effect due to the nature of gambling, and people who are particularly affected by gambling disorders will likely experience it to greater effect. It is important to put stop-loss orders in place, typically at a point that will ensure no more than a 10 percent loss on any stock. Given that these orders are conditional, this is a good practice to get into.
Some of the best day trading tips have to do with staying informed. Keeping an ear to the market can help a person make a lot of good long-term investments, but if one does enough research it is sometimes also possible to take advantage of a single day rise. Day trading tips that come from newsletters may or may not be reputable, but one can quickly determine which is the case by testing the information against the market. When one has a good idea of how the market will act, it is much easier to succeed with day trading.
There are many different theories on what strategies are best for day traders. It is a good idea to do thorough research on these strategies and perhaps even try them out on a fantasy market. When one decides to follow a strategy, one must stick to that strategy in order to make money safely and effectively. Day trading is like a job and should be approached with rules and strategies rather than gut feelings and luck.