How can I be a better Day Trader?

The only generic advice is that personal development should be your aim regardless of your track record or the extent of your experience. Whether a newbie or an old hand, it’s essential to constantly monitor ‘what works’ and consider how you will identify and react to the moment when ‘what works’ ceases to do so.

Preparation and testing

If you’re opening a new account with a broker or looking to test a new strategy, then remember to start small and stay small for as long as you can. If you do miss an opportunity because you were late in scaling up your trading size, then take comfort from the fact that scaling up before testing is complete can lead to accounts being completely wiped out.

Trade execution

Your strategy should detail trade entry and exit points. Returns can be finessed, and discipline maintained through the use of Limit Orders(link to What is a Limit Order?).Stick to the strategy and when you see that a trade is going against you, prioritize minimizing the loss. Everyone likes to talk about increasing profits but the processes you use to minimize losses are equally important.


Unfortunately, this requires more than just recapping one of your successful trades and slapping yourself on the back about the amount of profit you made. Whilst you do need to study the winners as well as the losers keep an open mind to learn from both scenarios. Reviewing can also be really useful because you might use a new tool or notice a new metric that can then help you with future trading. Use the tools availableon your platform to analyse your performance. The below is taken from a Demo account:

Specific to you

If you are trading independently then you need to be realistic about what you can’t do. Be aware of when you will be able to devote your time to research or trading. Appreciate that successful time management is going to be a big influence on your P&L. Are there times of day when you just can’t access the markets and how does this influence your strategy choice? Trading can take a lot out of you and clash with a day job or social commitments. Devoting time to trading involves some kind of opportunity cost that you might want to be mindful of.What is your cognitive bias? How do you manage commitment bias?


You’ll hopefully have established that the question of “How to be a better Day Trader?” is as useful a question as it is an interesting one. There are lists of hints and tips like the ones below which may save you money (or not) but tailoring the question to your own situation and trading style should be a priority.
  • Trade in expectation, not hope.
  • If you have 10 great trading ideas, then consider just using the best three. Are you certain that the other seven are as likely to be profitable as you’d hope they are?
  • Monitor and update your Risk Measurement and Risk Management procedures.
  • Don’t trade too much.
  • Don’t double down.
  • Don’t move stop losses away from the price.
  • Remember that markets are not rational.

Paradigm Shift

Even successful traders need to worry. Paradigm shift is a fundamental change in approach or underlying assumptions. This is the moment when ‘what works’no longer does. It’s unlikely, more likely impossible, that you’ve completely covered every aspect of what is required to be a good trader; but even if you have, the risk of a paradigm shift should still be keeping you awake at night.