Posted on October 06, 2010 by Rich Browne

It is a myth that a significant amount of capital is required to commence trading as a day trader. You do no not need to have a fancy degree in business to be a day trader.

In short a day trader can be defined as an individual who buys and sells shares within the same day. There are other financial instruments which can be bought and sold the same day such as options, futures, currencies but this article relates to trading shares as a day trader.

It is important to remember that day trading is not a guaranteed way of making money. There can be gains and losses. If you don’t want to incur losses day trading is not for you. You would be better off with a term deposit.

To ensure day trading is for you it is best to open a practice account which allows you to trade virtual money on a stock exchange. Many online brokers allow you to do this.

To get started it would be preferable to open an account with an online broker. The beauty of online brokers is that they offer discounted brokerage as opposed to full service brokers who charge significantly higher brokerage. The cost of online brokerage starts from around $9 and can be as high as $60 depending on the amount traded.