Introduction: Why Day Trading?

Introduction: Why DayTrading?

If you’re thinking about getting into day trading, then you’ve probably got a pretty strong motivation. More often than not, that motivation is money. You want to be rich. No, wait. Let me be a little more specific:you want to be wealthy.

Just to make sure that we’re on the same page, let me touch on the key difference between being “rich” and being “wealthy:”

1.) “Being rich” means that you have a lot of money.

2.) “Being wealthy” means that you actually have time to enjoy your money, time to do what you want to do when you want to do it.

So, is day trading really the ultimate solution to becoming wealthy? Let’s see.

Here's one way to become rich:

You work your way up to the position of an executive in a corporation and make hundreds of thousands of dollars a year. Of course, you’ll be working at least 10 hours per day and at least 6 days per week.

Here are three ways to become wealthy:

1.) Starting Your Own Company or Internet Business

2.) Investing in Real Estate

3.) Day Trading

Option 1: Starting Your Own Company or Internet Business

Having your own company means that you’ll have to find or create a product, market the product, sell the product, deliver the product to your customers, and collect the payments.

These days, there are many “Internet Marketing Gurus” trying to sell youon the idea that you can automate everything, which will allow you to sleep late, do nothing, and cash very fat checks on a regular basis. We both know that this is a dream, nothing more.

You can automate the routine, sure, but not the exceptions. And believe me: there are always exceptions when dealing with people – your customers. Plus, as long as you have computers involved, you need to keep Murphy’s Law in mind: "Whatever can go wrong, WILL go wrong.” Nothing could be truer!

Even if you could automate most of the delivery, you still have to find or create a product, set up a website, write salescopy, put the automation in place, and generate traffic. And since the Internet is evolving so quickly, you will constantly have to update your website and traffic generation methods.

Okay, so what if you skipped the Internet part? If you have a “physical” business, the headache might be even bigger: employees, vendors, lawyers, competitors, invoices, customers, production problems, office space, equipment, etc. I’ve known a number of small business owners who have simply given up and gotten a regular 9-5 job. Sometimes the reward just isn’t worth the stressful lifestyle

Option 2: Investing In Real Estate

Our second option on the road to wealth is investing in real estate. But with the market slowing down and the current credit crunch, it’s not that easy anymore. Most lenders these days require a down payment of 10-20% for investment properties, so you also need substantial capital to even get into the business.

Another problem is the cost of a transaction. Whenever you buy or sell a house, you will most likely have to pay a Realtor’s commission and face closing costs. Because of these factors, it’s not easy to quickly buy and sell houses. A transaction can last several days or several weeks. And on top of that, you always have the possibility of problems with renters (if you are renting out), or with contractors (if you are “fixin’ and flippin’”) or with legal issues if you use those “creative techniques” that some of the late night infomercials are promoting. It basically boils down to onebig pain in the neck!

You need an appraisal, too, and you might have to argue with the appraiser about the value of the house; you need a home inspection and might be surprised when you learn of all the things that need to be fixed before you can sell; and, last but not least, your buyer might have to obtain a mortgage. As you know, the mortgage industry has really become “interesting” in 2007 (to say the least), and buyers that were pre-approved and pre-qualified might learn the day before closing that they won’t receive the promised loan. And all of these problems are just the tip of the iceberg. When it comes to hassle and problems, real estate investing is a flip of the coin, at best.

So, what’s left?

Option 3: Day Trading

In my opinion, it’s the perfect way to become wealthy. Here are ten reasons why:

1.) It’s the total “equal opportunity” job

Your race doesn’t matter. Your skin color doesn’t matter. Your education doesn’t matter, whether you’re a Ph.D. or a college drop-out. Your sex doesn’t matter. Your origin doesn’t matter. Your age doesn’t matter. Your background and history don’t matter. Even if you’ve been in jail for years, you could still make money with trading. Your language doesn’t matter. Your looks don’t matter. And your social status doesn’t matter, as long as you have sufficient funds to trade.

2.) No employees to hire

You don’t have to hire any employees, which means you don’t have to worry about job interviews, payroll, employee evaluations, holidays, sick days, or employee performance. Your only “team member” is your broker, and if he doesn’t perform, there are 10 others waiting in line for your business.

3.) No inventory, office space, or other equipment (besides your phone and your computer)

You don’t have to buy or rent expensive office space, and you don’t have to stock any products, which means you don’t have to worry about expiration dates, damaged goods, shipping, handling, insurance, or displays and promotions of goods.

4.) No vendors, no customers, no invoices, and no accounts

receivable You won’t have to deal with any face-to-face contact. You don’t need any vendors, you don’t need to satisfy any customers,  you don’t need to provide any customer support, and you don’t need to worry about any invoices, bounced checks, fraudulent credit card charges, returns, or charge-backs.

5.) The time required is minimal

Whether you have a regular job or run your own business, the chances are that you’re working at least 40 hours per week. With day trading, you can trade either part-time or full-time. You can start trading for as little as one hour per week, or you can go for the maximum of 2 hours per day.It’s your choice.

6.) Low capital requirement

You don’t need a lot of money to get started. This is not like buying property, for example, where you’re on the hook for a monthly mortgage and other cash-draining expenses. In trading, you can start with as little as $1,000! (We’ll talk about how a little later.)

7.) Returns are almost instantaneous

I'm talking "fast cash" in the sense that trading allows for quick liquidation. You can convert trades for cash within seconds. Where else in the world can you make money this fast and comfortably? You can buy and sell and buy again in minutes. You don’t have to wait to see your profits. Try this with real estate or physical goods, where you might have to wait weeks, or even months.

8.) Low transaction cost

You pay less than $10 per transaction in trading. Compare that to real estate transactions, in which you have to pay several thousand dollars in closing costs, not to mention a 3-6% commission to your realtor

9.) It's simple to learn how to make money with day trading

You don’t have to go to college for years. And unlike most other professions, years of experience are not necessary either. After teaching hundreds of people how to make money with day trading, I firmly believe that everybody can learn how to become a successful trader.

10.)You don’t need much to get started

In fact, there are only six things that you DO need:

a.) A computer

b.) An Internet connection

c.) A charting software

d.) A broker

e.) A properly funded trading account

f.) A good trading strategy

I could go on and on, but I think you get the picture. Throughout this book, we’re going to cover a lot of material that will help you get started with trading successfully. Here are a few of the essentials:

1.) What exactly is day trading

2.) Who should be day trading

3.) Is it really possible to make a living as a day trader

4.) What you need to get started

5.) How much money you’ll need to begin trading

6.) What markets are out there and which ones you should trade

7.) How to develop a profitable day trading strategy

8.) How to ensure that your day trading strategy actually works

In short: you will learn everything you need to know to start making money with day trading. Ready?