If you decide to day trade here are some day trading tips and help you on your journey to intraday trading success.

Learn what you are doing – Often times people get involved in day trading because they seek to eliminate the risk they perceive in holding positions overnight. What we must also keep in mind is the fact that we may miss out any potential profits from overnight market movement. In any event, we should not enter into the virtually nonstop, fast-paced world of day trading without being properly prepared. With that said, it makes perfect sense to learn what you are doing and become proficient in your knowledge and execution of intraday trades.

“Day trading” does not mean “every day trading” – One of the first things to keep in mind is that you don’t have to trade every day. Day trading does not necessarily have to be high-frequency trading in order to be extremely profitable. That’s right! You see, we are more interested in those trades which have the highest probability of success. As with all trading our objective is profits regardless of trading frequency.

Choose the right financial instrument – For day trading to be successful, there needs to be enough intraday price movement for trades to be profitable. Volatility is a key consideration in choosing what to day trade. A stock that only has a $0.10 range for the day would require many more shares to be traded than a stock that has a range of $2.50 per day. Leverage is also an important factor to consider. Futures and Forex make excellent day trading vehicles because both markets are not only volatile, but also have much more leverage available than stocks.

Pay close attention to transaction costs – It stands to reason that someone who trades 20 times per day will have more transaction costs than someone that trades once per month. Many intraday systems may start out looking good to us on paper, but once transaction costs are figured in things may not look so rosy.