Trading for a Living and the fallacy of Day Trading

I am going to talk about an activity with a failure rate quite high.

This activity is Day Trading, and the fact that there are a lot of people who supposedly make a living out of it, which in some way is true. The problem is that most people who do so are not day traders buying and selling assets. How is that possible?

Truth about trading for a living

It is possible because the Day Trading industry is huge and is composed of hundreds of thousands of guys who work for and promote it. Like brokerage employees and people selling courses, day trade systems, signals, managers.

All of them selling hope.

Many brokers promote day trading through offering lower spreads during the day session, but it does not mean that they forbid medium or long term trading.

The fact that a lot of people do day trading is not the broker´s fault really. They know that people have anxiety and hope to get rich quickly and facilitate that service to them.

If some of the day traders wake up after some time and change to more reasonable trading, it is ok, the brokerages do not really mind.

The amount of day trading customers seems endless.

Day trading fallacy

On the other hand, if you keep doing day trading you will almost certainly remain in the group of 99% day trading losers. About the 1% of winners, I have reservations. I think that most of that 1% will be at best even.

Day trading gurus, many of whom populate the internet, do not stop selling us the benefits of day trading for a living. Like being surrounded by blondes in a paradisiacal beach and the liberty of doing whatever you want to from anywhere.

Of course, travelling is one of the new mantras of our era, so if you can associate something with it you will find countless customers.

Everybody is dreaming of traveling around the world and many times per year. Day trading candidates dream of buying and selling financial assets from some Parisian cafe. But the fact is that the one who is going to have that coffee there is the guy who has sold them the course.

The fact is that the majority of great traders of our era, like the ones interviewed in The Market Wizards, did not succeed doing day trading, but swing and trend trading.

Hedge Fund day trading?

There is practically no Hedge Fund that does day trading as its main activity.


If day trading was so profitable, Hedge Funds would be using it massively. The only “Hedge Funds” that do day trading are the brokers, which make their living off the outstanding number of traders who over-trade the markets, paying them incredible commissions.

Day trading fantasy

The truth is that day trading success is overrepresented in the media, and it should not be like that. People should learn to trade in a more proper way and forget the fantasies of day trading.

If there are successful day traders we can be sure they will never share their method with us, let alone teach us a ridiculous course about day trading strategies.

There are ways of trading for a living. Like working for a broker; writing books about it or articles; selling courses or services (there are honest courses as well as scams); or living off dividends if you have a significant capital like a 2 million USD share portfolio; or making an extra income from a successful swing and/or trend trading strategy. But to make people believe that it is possible to make a living out of day trading is, in the majority of cases, a fallacy.