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Day Trading

In short

Opening and closing positions within the same trading day

Day traders buy and sell within the same day, never holding positions overnight. The SEC requires a minimum $25,000 account for pattern day traders (4+ round trips in 5 days). High skill, high risk, most beginners lose money.

Day trading involves opening and closing positions within the same session to profit from intraday price movements. Pattern Day Trader (PDT) rule requires $25,000 minimum equity. Day trading requires intense focus, fast execution, and risk management. Over 70% of day traders lose money long-term.

Related concepts

  • Market Hours — US stock markets are open Monday–Friday, 9:30 AM – 4:00 PM ET. There's also pre-market (4 AM – 9:30 AM) and after-hours (4 PM – 8 PM) trading, but with much less volume and wider spreads.
  • Buying Power — Buying power is how much you can trade with right now. In a cash account, it's your available cash. In a margin account, it can be 2× your cash because the broker lends you money to buy more.
  • Slippage — You see a stock at $50 and hit buy. By the time your order fills, it's $50.08. That $0.08 is slippage — the price moved between when you decided to buy and when the order actually filled.
  • Paper Trading — Paper trading lets you practice investing with imaginary money. All the real market data, all the real mechanics, but no real money at stake. Perfect for testing strategies before risking your actual savings.