3 Reasons Why You Shouldn't Day Trade
- Anthony Speciale
- May 18, 2024
- 4 min read
Hey Trader,
3 Reasons Why You Shouldn't Day Trade
Day trading sounds exhilarating, right? You see people on YouTube turning a couple of hundred dollars into millions all the time. Even though I’m a full-time day trader, I have to be honest with you—day trading is probably NOT for you.
I’ve been trading for over a decade now. Yes, the first couple years were a struggle; I never had a green month and watched my small account tank.
It was only after several years that I started making money trading.
Here are the three reasons why you shouldn't day trade:
1. You're Struggling Financially
The first and perhaps the most critical reason you shouldn't day trade is if you're struggling financially. If you can't pay your bills, don’t have a stable income, or are drowning in debt, you shouldn't day trade.
I understand this might be an unpopular opinion in a world filled with rags-to-riches stories on social media. Stories like the wallet that bought SHIB tokens and turned $8K into billions are incredibly inspiring.
They make you feel like you could do the same. But this is what we call survivorship bias—a tendency to focus on the success stories while ignoring the many failures.
When I started, I fell for this survivorship bias. I thought I could get rich quickly, but the big difference was I had a main street, blue collar job. Even if I lost my entire trading account, which I did, I wouldn't be financially devastated.
Having stable income meant I could pay my bills even when my trading account took a hit. If you have a job and want to start day trading with some small accounts on the side, go for it. But if you’re thinking of putting your last $1,000 into day trading without a stable income, think again.
People might encourage you to invest your last $1,000 into learning to trade, cryptos, or other ventures. I’m against that. Use that money to pay your rent and bills. When someone tells me they want to trade with their last $1,000, my response is always, “I’m sorry, but you shouldn’t day trade.”
This isn't to discourage you but to offer tough love. If my siblings were in a similar situation, I’d tell them the same. You can only become profitable in day trading if you focus on learning first and take initial small losses as market tuition.
If you’re financially struggling, you'll likely trade emotionally and forget about risk management, leading to further losses.
If you’re financially stable, then by all means, trade away. But if you’re struggling, find a job that provides stability first.
2. You're Looking to Get Rich Quick
The second reason you probably shouldn't day trade is if you're looking to get rich quick. Day trading is NOT a get-rich-quick scheme!
Years ago, I thought I could get rich quickly by following discord alerts. Did I actually get rich in one month? No!
In fact, copy trading and chat room alerts often lead to blown-up accounts. You might make small profits, but it only takes one bad trade to lose big.
Following alerts doesn’t teach you how to plan your trades, manage risk, or control losses. Many beginner traders have roller-coaster P&Ls because they focus on the illusion of quick and easy money rather than planning their trades.
Day trading requires you to pay your dues to the market.
Only those who focus on planning and managing their trades will succeed. If you want to get rich overnight, day trading is not for you.
3. You're Incapable of Critical Thinking or Taking Responsibility
The third reason you shouldn't day trade is if you're incapable of critical thinking and taking responsibility for your actions. Day trading isn't like a regular 9-to-5 job where you’re guaranteed a paycheck regardless of performance.
Day trading is a business where you're 100% responsible for your actions and your profit or loss. You could show up and still lose money, or do everything right and make huge profits. Whether you win or lose, the responsibility lies with you.
Trading requires introspection and review. What can you improve for next time? How can you manage risk better? These are questions you should ask yourself after each trading day.
Blaming pumpers, alerts, or the market won’t help.
If you profit, those gains are yours. If you lose, the fault is also yours. This business demands critical thinking and maturity. If you can't handle that, trading is not for you.
Day trading is a risky business! If you're struggling financially, looking to get rich quick, or can't take responsibility for your actions, then day trading is definitely not for you.
I'm not trying to discourage you, just giving you the real talk. This is tough love.
If none of these reasons apply to you, then feel free to day trade away!
Happy Trading,
Anthony Speciale
Speciale Analysis
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