The amount of capital you need depends on if you want to make day trading your full-time income or just a side hustle to make a couple extra dollars here and there.
As you probably know, I started a small account with just $500 and turned it into over a million in just two short years.
That’s an extreme example and most traders, even experienced ones, would have a hard time replicating that type of return.
My point is you don’t need a large amount of money to start day trading.
However, there are two questions you need to ask yourself when deciding how much money you need:
- How much are you looking to make per day?
- How much do you actually have to start day trading with?
Once we know the answers to those questions, then we just need to do some simple math.
Let’s say you are looking to make $100 a day but you only have $1,000 to put towards your day trading account.
That means if you trade a stock that is at $2.00 per share, you can buy 500 shares, which means you will need the stock to go up 20 cents in your favor to make your $100 goal.
This is a very simplified example, because we didn’t take into account margin which would allow you to have more buying power.
Make sure to watch the video above. I go into great detail about margin, PDT rule and using offshore brokers.
This will help give you a full understanding on how much money you should aim to have when you open your day trading account.