Our Tips & Strategies for New Traders

Day trading is a super exciting endeavour when you’re just starting out, but it’s crucial that you have a solid plan when you’re getting started, especially if you’re day trading on a budget.

In this blog, we will explore the tips, tricks and strategies new day traders need to keep in mind when starting out on their day trading journey. From setting budgets to helping mitigate risks these are the tips you should keep in mind when you’re day trading on a budget.

Set Your Budget

Before you even start your day trading journey, you need to establish a realistic budget that will work for you. Take a look at your finances and establish how much you can realistically afford to invest without risking your financial stability.

Your budget needs to cover your trading capital, any additional expenses for trading platforms and tools and cover your potential losses. It’s better to be more conservative when you’re setting your budgets than getting yourself in a position where you risk overleveraging.

Employ Risk Management

When you’re thinking about starting your day trading journey, effective risk management has to be considered – especially if you’re on a strict budget.

Ensure you set a stop-loss order for each of your trades to help you limit your risk exposure. You should also consider only risking a small percentage of your trading capital on your trades – for example, between 1% to 2%.

Another great risk management strategy that you may want to think about implementing is to diversify your trades across a number of different assets to help spread your risk more evenly.

Cost of Platforms & Tools

When it comes to day trading, the cost of trading platforms and tools is a sometimes overlooked cost that can start to stack up over time. You’ll want to do your research when it comes to the platforms and tools you are looking into using.

At IDTA, we have a range of completely free resources if you’re on a tight budget including free day trading books, free day trading classes and completely free day trading workshops to get you started off on the right foot. You may want to consider starting with a more basic platform for your day trading and upgrading as you grow your trading capital.

Don’t Forget Trading Fees

When it comes to day traders that are trading frequently, trading fees may have a significant impact on your profitability. You’ll want to be mindful of any broker commission fees and it may be best to try to find brokers that offer competitive fee structures or even look into commission-free platforms or trading.

Research the various trading products, platforms, and brokers available to you before you choose where to do your trading.

It’s Time to Begin Day Trading on a Budget!

When it comes to day trading, keeping to your strict budget requires careful planning and knowledge about different strategies to help you get started. When you set a realistic budget, implement effective risk management strategies and minimise trading costs, you can help to increase your chances of day trading success without blowing through your limited capital.

Enrolling in our IDTA day trading courses and workshops is a great way to familiarise yourself with the day trading world so that you can get to planning and begin your day trading journey!

Free day trading web class