Day Trading for Beginners (2024 Guide)

A list of the Top Day Trading Brokers for October 2024

1. Plus500
2. Pepperstone
3. Spreadex
4. eToro
5. AvaTrade
6. Saxo
7. IG
8. Coinrule

Description of the Best Day Trading Brokers for October 2024

Another user-friendly entry on our list of the best forex and CFD brokers in the UK is Plus500, providing an easy-to-use and accessible service.

You’ll find over 60 CFD currency pairs with competitive spreads, no commission and available leverage of up to 1:30.

Although MetaTrader and cTrader are not available, Plus500’s own platform is very user-friendly. It comes with a range of intuitive risk management features and is available on web and mobile.

Plus500 requires a minimum deposit of £100 if using a credit or debit card, and £500 if using bank transfer.

Plus500 UK Ltd authorized & regulated by the FCA (#509909).

80% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. *CFD trading via Plus500’s demo account.

Pepperstone is an excellent choice for beginners interested in day trading due to its user-friendly platforms, comprehensive educational resources, and supportive trading environment.

Pepperstone offers the popular MT4 and MT5 platforms, known for their intuitive interfaces and robust trading tools. These platforms provide essential features for day traders, such as advanced charting tools, multiple time frames, and a wide range of technical indicators. Beginners can benefit from the customizable layout and the ability to tailor the interface to their trading needs.

cTrader is another platform available with Pepperstone, designed for ease of use while offering advanced trading functionalities. It includes sophisticated order types, detailed charting, and rapid execution speeds, making it ideal for day trading. The platform’s simplicity is particularly advantageous for beginners learning the ropes of trading.

Pepperstone also offers TradingView for free.

Pepperstone provides a wealth of educational content specifically designed for beginners. This includes regular webinars hosted by market experts that cover fundamental and technical analysis, trading strategies, and platform tutorials. These resources help beginners build a strong foundation and develop effective trading strategies.

The broker offers daily market analysis and insights, which are crucial for day traders who need to stay updated on market trends and economic events. This analysis helps beginners make informed trading decisions and understand the factors influencing market movements.

Pepperstone offers demo accounts that allow beginners to practice trading in a risk-free environment. This is an excellent way for new traders to familiarize themselves with the platform, test their strategies, and gain confidence before trading with real money.

Pepperstone provides 24/5 customer support via live chat, phone, and email, ensuring that beginners can get help whenever they need it. The availability of responsive and knowledgeable support is crucial for new traders who may have questions or need assistance with their accounts.

75.3% of retail investor accounts lose money when trading spread bets and CFDs with this provider.

Spreadex offers several appealing features that make it a suitable platform for beginners interested in day trading.

Spreadex is known for its intuitive, user-friendly interface. Winning awards for its mobile app and platform reliability, the platform ensures that beginners can navigate the trading environment with ease. This simplicity is essential for day traders who need to make quick decisions and manage trades efficiently throughout the trading day.

For day traders, variety in tradable assets is crucial. Spreadex provides a broad selection of CFDs on US shares and ETFs, allowing traders to capitalize on price movements across different sectors and instruments. The availability of extended hours trading is particularly beneficial for day traders, giving them the flexibility to trade before and after the regular market hours, thus taking advantage of earnings announcements and other news events that can influence stock prices.

Integration with TradingView enhances the day trading experience on Spreadex. TradingView offers powerful charting tools, real-time data, and advanced technical analysis capabilities. For beginners, these tools are invaluable as they help in identifying trends, patterns, and potential trading opportunities within the day. The platform also enables customization and the use of various technical indicators, which are essential for conducting thorough market analysis in day trading.

Spreadex is accessible to beginners due to its no minimum deposit requirement and the absence of inactivity fees. This feature is particularly appealing to new day traders who may start with lower capital and wish to experiment with trading without the stress of meeting deposit thresholds or incurring fees during less active periods.

Though day trading is complex and involves a steep learning curve, Spreadex aids beginners with valuable educational resources. For example, a deposit of £500 or more grants access to a free subscription to Financial Tomes, providing insights and analyses that can be crucial for making informed trading decisions during the day.

While Spreadex offers many tools beneficial for day trading, it’s important to note that it does not provide MetaTrader 4 (MT4), which might be a drawback for those accustomed to or specifically seeking out this platform. Additionally, Spreadex focuses on CFDs and spread bets, which involve leveraging that can increase both profits and losses, something day traders should handle with care.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

Below content does not apply to US users

Founded in 2007, eToro is considered a very low-risk broker as it is highly regulated by the Financial Conduct Authority (FCA) in the UK and many other regulatory bodies elsewhere.

Opening an account is free and you can access a $100,000 demo account to test the system.

It offers 47 currency pairs for trading. Spreads for forex trading have recently been significantly reduced and range from a very competitive 1 to 3 pips for major currency pairs.

Typical spreads for EURUSD and USDJPY trades, for example, are just 1 pip.

You can see the full list of spreads on the eToro website.

You’ll need to deposit a minimum of $200 for Copy Trading, eToro's standout feature which allows you to follow other traders and copy their trades.

This forex broker is great for beginners due to its user-friendly interface and app and 24-hour customer support. It allows you to trade currencies, stocks and cryptocurrencies in one portfolio and the Copy Trading system is a great way to learn.

The company also offers trading courses and features a Learning Lab which houses a variety of tools to support clients with their trading experience.

To find out more, read our eToro review.

51% of retail investor accounts lose money when trading CFDs with eToro. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

AvaTrade can be a suitable option for beginners interested in day trading due to several features that cater to the needs of novice traders.

AvaTrade is regulated in multiple jurisdictions, providing a level of security and credibility. For beginners, trading with a regulated broker is crucial to ensure the safety of their funds.

AvaTrade offers a diverse range of financial instruments, including Forex, commodities, indices, stocks, and cryptocurrencies. This variety allows beginners to explore different markets and find suitable opportunities for day trading.

AvaTrade provides access to multiple trading platforms, including MetaTrader 4 and 5, and their own AvaTradeGo mobile app. These platforms are known for their user-friendly interfaces, making them accessible for beginners.

The platforms offer various tools and features such as real-time charts, technical analysis tools, and automated trading options, which are beneficial for day trading.

For beginners, education is key, and AvaTrade offers a wealth of educational materials. This includes webinars, e-books, tutorials, and articles that cover the basics of day trading, strategies, market analysis, and risk management. These resources are invaluable for beginners to understand the fast-paced nature of day trading.

Beginners in day trading can practice their strategies and get familiar with the trading platforms using AvaTrade's demo account. This account simulates real trading conditions but uses virtual funds, allowing novices to gain experience without the risk of losing real money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Saxo offers a robust environment that's well-suited for beginners interested in day trading, thanks to its comprehensive resources, user-friendly platforms, and strong regulatory framework.

Saxo provides two main platforms, SaxoTraderGO and SaxoTraderPRO, which are both equipped with intuitive interfaces ideal for beginners. SaxoTraderGO, in particular, is designed with simplicity in mind but doesn't compromise on the powerful features necessary for effective day trading, such as real-time charts, technical analysis tools, and order execution capabilities.

Saxo excels in offering extensive educational materials that are crucial for day trading beginners. These resources include webinars, video tutorials, and articles that cover fundamental trading concepts, market analysis, and risk management techniques. These educational offerings help new traders understand the fast-paced nature of day trading and develop the skills needed to navigate the markets effectively.

Saxo provides a demo account where beginners can practice day trading with virtual money. This is an excellent way for novices to gain experience without the risk of losing real capital. The demo account mirrors the real trading environment, offering a practical, risk-free way to learn the ropes.

Beginners have access to a diverse array of financial instruments on Saxo's platforms, including stocks, forex, commodities, and indices. This allows new day traders to experiment with different markets and find the niche that best suits their trading style.

Understanding and implementing effective risk management is vital in day trading. Saxo's platforms include features such as stop-loss orders, which can help beginners manage and limit potential losses, an essential aspect of trading education.

Saxo's status as a globally regulated financial institution provides an additional layer of security and peace of mind for traders. Knowing that they are trading with a reputable and compliant broker can ease some of the stress new traders might feel.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs, FX or any of our other products work and whether you can afford to take the high risk of losing your money. Losses can exceed deposits on some products.

IG is a great share trading platform for beginners thanks to its user-friendly interface and extensive educational resources.

Pros of IG include a wide range of trading instruments and markets, as well as the ability to access multiple account types and trading platforms. The platform also offers a demo account for beginners to practise trading strategies before investing real money.

However, IG isn’t the cheapest share trading platform, with relatively high trading fees and a minimum deposit requirement of £250 when paying by credit/debit card or PayPal.

In terms of additional fees, IG charges a commission fee for share trading, starting from £8 per trade. There’s also a custody fee of 0.25% per year for holdings of £250 or more.

Overall, IG is a solid choice for beginners looking for a user-friendly platform with extensive educational resources, but investors should be aware of its fees and minimum deposit requirements.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of IG retail investor accounts lose money when trading spread bets and CFDs with IG. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Fee: Free with a starter account or from $29.99 per month

Try Coinrule Premium Almost Free with 67% OFF - Black Friday Offer!

With its simple, intuitive design, Coinrule is a good choice for those who are new to trading as well as more advanced traders.

Users don’t need to know any code to set their trading rules.

Coinrule is web-based and works across several cryptocurrencies as well as supporting some of the most widely-used exchanges, such as BitMex.

Considerations for Choosing a Day Trading Broker

As mentioned above, there are various trading brokers to choose from. Still, the right fit for you may differ depending upon your experience and the financial investment you are willing to start with.

One must check the regulations of trading brokers.

It is always best to stick to tier-1 regulated brokers as both the platform and client are under the complete supervision of a global financial legislator.

Stepping out of these realms may increase the legal risks of your trading activity.

Further, a day trader must understand their strengths and limitations.

Those beginning with day trading may want to optimize trading brokers with good customer support, simple analysis tools and low commission fees.

However, suppose you are not new to day trading. In that case, a platform that deals with higher fees and more complex financial margin practices may be better suited to your needs.

Another consideration for choosing a broker is the volume of educational material accessible through that platform.

Some trading platforms, such as those mentioned above, are transparent and include tools to help those unfamiliar with trading.

What Is Day Trading?

Many have become accustomed to the idea of trading, either as a hobby or as a financial incentive.

Day trading is the act of either buying or selling a financial instrument over the course of one day.

In contrast to long-term trading, day trading can result in a monetary contract being bought or sold multiple times during a trading day.

A financial instrument is something trading speculates over and can come in cash, a share in a company and even debt.

Good and experienced day traders take advantage of the shifts in speculation of these financial instruments, profiting from the small changes that occur during the day.

Such a game can be risky without knowing how to measure speculation; however, it can be equally lucrative if a trader knows how to apply the right strategies.

How Does Day Trading Work?

As discussed, the most significant difference between a long-term trader and a day trader is time.

One speculates over financial investment over weeks, sometimes months; the other does this over 24-hours.

With such a short time frame to work within, the way day traders make it into a profitable pursuit differs.

A financial instrument is not often seen as a product of investment but rather as a tool to either buy or sell quickly, dependent upon its short-term value.

Strategies are dependent upon short-term gain.

As the value shifts over the course of 24-hours, a day trader must be willing to capitalize on small incremental changes, considering the nature of the trade, as it will not be there tomorrow.

The positions, an amount of financial security given to a set of financial instruments, are closed at the end of the trading day.

With this in mind, day traders often used specialized software to map the value of their chosen financial instruments.

They also use leverage in the form of a margin instead of equity or profit.

This is because of the omission of investment in any of the financial instruments.

Day Trading: How to Decide What and When to Buy

When it comes to day trading, one of the most important decisions a trader will make is what and when to buy.

Here are some key factors to consider when making these decisions:

Market Trends and News

Traders should always be aware of the market trends and any news that may impact the stocks they are considering.

This can include:

• Industry-specific news
• Earnings reports
• Economic data releases
• Global events

Keeping an eye on the news can help traders make informed decisions about what to buy and when.

Technical Analysis

Technical analysis involves studying charts and other data to identify patterns and trends in the market.

This can help traders identify potential buying opportunities based on past price movements.

Fundamental Analysis

Fundamental analysis involves looking at the underlying financial health of a company.

This can include factors such as:

• Earnings
• Revenue
• Debt
• Management

Traders may use this information to identify stocks that are undervalued or poised for growth.

Risk Management

Day traders must also consider the risks involved with any investment.

This includes factors such as:

• Volatility
• Liquidity
• Trading volume

Traders should also set clear stop-loss orders to help minimize potential losses.

Trading Strategies

Every trader has their own trading style and strategies.

Some may focus on momentum trading, while others may prefer scalping or swing trading.

It's important for traders to choose a strategy that aligns with their strengths and preferences.

Day Trading: How to Decide When to Sell

When day trading, deciding when to sell is just as important as deciding what and when to buy.

Here are some strategies to help day traders make informed selling decisions:

Set a Profit Target

Before entering a trade, a day trader should set a profit target. Once the target is reached, the trader should sell the position.

This strategy helps ensure that a trader locks in a profit and avoids getting too greedy.

Use Stop-Loss Orders

A stop-loss order is an order to sell a security if it reaches a certain price, helping to limit a trader's losses.

Setting stop-loss orders can help traders limit their downside risk and protect their capital.

Track Technical Indicators

Technical indicators, such as moving averages and Relative Strength Index (RSI), can help traders identify when a stock is overbought or oversold.

When a stock reaches either extreme, it may be a good time to sell.

Stay Informed

Day traders need to stay informed about the news and events that can affect the stocks they're trading.

For example, a negative earnings report or a major product recall can lead to a drop in stock price, and a trader may want to sell their position before the price falls too far.

Trust Your Instincts

Ultimately, day traders need to trust their instincts and make quick decisions based on the information they have.

This comes with experience and practice, so it's important for new day traders to start small and learn from their mistakes.

How to Read Day Trading Charts and Patterns

Day trading charts and patterns are essential tools for any trader.

Here are some tips for reading them effectively:

• Understand the different chart types – There are several types of charts, including line, bar, and candlestick charts. Each one displays information differently, so it's important to understand the differences and choose the one that works best for your trading style.

• Learn to identify patterns – Chart patterns can provide clues about market trends and potential opportunities for profit. Some common patterns include head and shoulders, triangles, and double tops/bottoms. Learning to recognize these patterns can help you make more informed trading decisions.

• Use technical indicators – Technical indicators are mathematical calculations based on the price and/or volume of a financial instrument. They can help you identify trends and potential entry/exit points. Common technical indicators include moving averages, relative strength index (RSI), and stochastic oscillators.

• Analyze volume – Volume is the number of shares or contracts traded during a specific period. High volume can indicate that a stock or market is gaining momentum, while low volume can indicate a lack of interest. Understanding volume can help you determine market sentiment and identify potential trading opportunities.

• Practice chart analysis – Reading charts takes practice, so it's important to spend time analyzing them and identifying patterns. Consider using a trading simulator to practice analyzing charts and patterns without risking real money.

Benefits of Day Trading

Day trading can be a lucrative opportunity for those who have learned the ropes of the trade.

The top day traders can make up to $150,000 annually, making it an attractive option for those looking to invest in their financial future.

One of the major benefits of day trading is that the amount a trader chooses to start with is entirely up to them, which can determine their profit margin.

For example, a trader starting with $10,000 is more likely to make a bigger profit than a trader starting with only $1,000.

Freedom in Trading: Choosing Your Financial Instruments

Day traders have a degree of freedom with the financial instruments they choose to speculate over and with the amount they are willing to place into them.

If a day trader feels confident with their strategies, there is nothing to curtail them from this.

As well as effectively being your own boss, a day trader does not have to worry about any extraneous pressures, such as deadlines or the maturity of their financial investments.

With it being a day-to-day operation, a trader can take respite at the end of the trading hours.

Flexibility in Trading: Starting a New Page Every Day

Day traders also start with a new page every day. They do not have to worry about the impact of overnight investment from other international markets.

A trader working within the confined hours of the day can capitalize on the speculations in front of them.

This means that they can quickly react to market fluctuations and can take advantage of short-term opportunities that may arise during the day.

However, it should be noted that day trading can be challenging, and traders need to be disciplined, knowledgeable, and able to make quick decisions.

Risk management strategies should be in place, and traders need to be able to accept the possibility of losses as well as profits.

Nonetheless, for those who are willing to put in the time and effort to learn, day trading can be a fulfilling and profitable endeavor.

What Makes Day Trading Difficult?

Day trading, the practice of buying and selling financial instruments within the same trading day, can be a challenging activity for many traders. Here are some factors that contribute to the difficulty of day trading:

Volatility

Financial markets can be extremely volatile, especially on a day-to-day basis.

Prices can change rapidly, and unexpected events can cause significant fluctuations in the market.

This volatility can make it difficult to predict price movements and can increase the risk of losses.

High Risk

Day trading involves a high level of risk due to the use of leverage and the short-term nature of trades.

Leveraging means borrowing money to invest in securities, which amplifies both profits and losses.

Also, day traders are not guaranteed profits and can experience significant losses if they don't manage their risk properly.

Emotional Control

Day trading requires strong emotional control as it can be a stressful and emotionally taxing activity.

Traders must be able to keep their emotions in check, avoid impulsiveness and maintain a disciplined approach to trading.

Information Overload

Day traders need to process vast amounts of information and stay up-to-date on market news, economic reports and other relevant data.

This constant stream of information can be overwhelming, and traders must be able to quickly sort through and analyze the information to make informed trading decisions.

Technical Skills

Day trading requires a strong understanding of technical analysis, chart reading and order execution.

Traders need to be proficient in using trading software and other tools to analyze market data, identify patterns and trends, and execute trades quickly and accurately.

These factors make day trading a challenging and demanding activity that requires discipline, patience and a commitment to continuous learning and improvement.

Successful day traders are those who can manage their risk, keep their emotions in check and have a deep understanding of the markets they trade.

Now that you have reviewed the activities, benefits and challenges of being a day trader, you will need a few essentials to set yourself up for success.

First and foremost, a day trader needs proficient Wi-Fi, computer speed and adequate platform software.

Day trading can be done in any space. Still, these essentials will give you consistent updates about the speculations of your financial instruments.

How to Be a Successful Day Trader

Day trading requires several skills to turn speculation into success.

Disciplined and Patient

A good day trader must be disciplined and patient with their investments.

The market prices of financial instruments can widely shift throughout the course of the day, and a trader must be willing to observe these shifts without making rash decisions.

Organized

A good day trader needs to be organized with the financial instruments they have chosen to speculate over.

The price of stocks or shares can change considerably over 24 hours, so observance is a crucial skill.

Adaptable

As the value of a day trader's chosen financial instruments changes over the day, they may need to alter what they are keeping their eyes on.

Adaptability within the market a day trader is involved in is essential.

Willingness to Accept Failure

Not all financial instruments will bring success. A day trader must be willing to accept an inevitable degree of failure.

Any financial investments that do not turn out well should not discourage a day trader, as there may be one equally successful around the corner.

Where to Learn Day Trading

The material concerning day trading is ubiquitous and varied, meaning it can be overwhelming to beginners looking for simple trading guides.

We understand these concerns and have included our own breakdown of some of the best materials available in a dedicated article.

Go and read our article on the the 15 best day trading courses for all the information you will need.

Understanding this guide and what each of the courses offers can give you a significant advantage before entering into trading.

Each educational resource offers a distinct specialty.

For example:

The Asia Forex Mentor is a comprehensive resource targeted at beginners.

In contrast, the Investors Underground is much more suited for traders already experienced and offers the opportunity to communicate strategies with other traders.

Outside of our recommendations, there are numerous ways to educate yourself about day trading and its potential success.

Brokers, such as eToro, offer introductory courses for those starting.

Suppose you need a break from internet resources. There are some great books on day trading, including The Complete TurtleTrader by Michael Covel and How to Day Trade for a Living: A Beginner's Guide to Trading Tools and Tactics, Money Management, Discipline and Trading Psychology by Andrew Aziz.

These resources, including our recommendations, will give you an excellent platform for taking on the challenges of day trading.

Frequently Asked Questions

Final Thoughts

Whether you are new to the idea of trading or experienced with the other forms of trading, the day trader can be a very successful pursuit.

The challenges are at first tough and should not be understated.

However, with our guides and the knowledge of other day traders, there is no reason why you cannot make day trading part of your financial income.

Learning day trading, practicing it on the brokering platforms, and even talking about it can become immersive.

Even if you are more conservative with the number of funds, you would like to initially, it is still a fun activity.

Trading, particularly day trading, is becoming more inviting for individuals who have not experienced anything of its nature before.

This could be your new financial opportunity and hobby.

WikiJob does not provide tax, investment, or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal.