Learning Day Trading

I am interested in day trading, other than the 25k limit, can I do what I had planned?

I want to use the funds to buy stocks that have a relatively low beta, and just trade them throughout the day, and be clear of my position by the end of the day. So for instance, I want to buy a stock at 2.25 and then sell it at say 2.26. But I want to do this several times throughout the day. Is this possible once the 25k minimum requirement is met for day trading?

Public Comments

1. Yes, if you use a margin account. To make a profit on a 1 cent spread, you are going to have to trade a lot of stock. 10000 shares gives you only $100 profit less brokerage fees. If the market moves against you, you could wind up loosing a lot of money.
2. NO - be careful, the 25,000 in NOT a limit or a basic deposit requirement, it is the MINIMUM EQUITY that must be maintained in an account at ALL times. So yes you can go in and out of positions all day long and an many times as you want BUT you must keep your account EQUITY at $25,000 at all times. Equity = market value of open positions less any debit balance. So if you put up 25,000 and go out and buy for 5,000, your equity would be below the $25,000 requirement, as soon as the market value would drop below the purchase price. AND be careful, securities selling below $5 a share have no loan value therefore they can not be used for margin. With commission and charges, you'll need more than $.01 spread to make money. Most firms will charge you more for "penny" stock since the cost of execution and clearing is higher.
3. Great idea..... the good (experienced) day traders look for high beta stocks... you'll look for the low beta. Most day traders look for stocks above $5..... you'll look for stocks below. Most of us take years before we'll day trade... and more years before we'll day trade penny stocks. I read a new trading book every month. Most of my peers do the same. You ask no question about education. You just want to know if it can work. So here's your answer; You can trade stocks at $2.25 and sell them at $2.26. You would have to risk a lot of money to do this. What will you do if the stock moves down 1 cent... 2 cents or more? How many wrong trades can you make before killing the profit of 1 cents? Most day traders look for at least a 1 to 1.5 win loss ratio. 3 to 1 is more the ideal. Your approach should wipe out your account in less than a week.
4. You can look for myfxfunds in google/yahoo search engine My managed account has grown to 40% in 3 months. No one is able to withdraw/deposit your account because the account purely belong to you and traders only trade your account through POA agreement.