How to Day Trade For a Living With as Close to Zero Downside Risk as Possible:
In order to generate a return in the market, you first need money. Without money to start with, there’s no money to be made. This reality makes capital the single most important resource for every day trader – especially those attempting to do it for a living.
But most people simply don’t have $50,000 to $150,000 just lying around in order to fund their own trading accounts. It’s not so hard to scrounge up $500, $1,000, or maybe even $10,000, but trading for a living requires a much more substantial account size than that.
If these numbers seem overwhelming and well out of reach, you’re not alone. But your dream of day trading for a living doesn’t have to be over. In my personal opinion, you’re actually in one of the best positions to ultimately succeed with limited financial risk.
I say this because most individuals who initially have money and attempt to day trade quickly lose it. So without a bunch of money to dive right into the market with, your risk is already limited. And as a beginner, real money trading shouldn’t even be on the table.
Instead of focusing solely on dollar signs, which is why so many traders fail, you can focus on building legitimate trading skills. And once you acquire those skills, doors will open with potential funding opportunities. In other words, you don’t need to trade your own money.
Below we’ll discuss how to earn a $150,000 account and trade for a living in 3 steps – all with $5,000 or less of your own money.
How to Earn a $150,000 Account and Start Day Trading For a Living in 3 Simple Steps:
I call this process simple because it’s broken down into three clear-cut steps, but by no means is it fast or easy. Day trading for a living isn’t some get-rich-quick venture; it’s a difficult undertaking that requires hard work, discipline, and the development of skills.
STEP #1: High-Quality Education and Training in Order to Build Legitimate Trading Skills
#1 Recommendation → Thomas Kralow’s University Grade Trading Education
The vast majority of individuals who attempt to day trade avoid proper education and training, which explains why the vast majority of day traders fail. But skill-building is the foundational component of day trading success. Without it, you’re just gambling.
The market can easily trick you into thinking that skills don’t matter. But long-term day trading success has nothing to do with luck – it’s entirely skill-based. If you don’t have a statistical edge or the ability to properly execute on it, then the market will humble you.
With virtually no barriers to entry, it’s extremely easy to get involved with the market. And on top of that, it’s extremely easy to click a couple buttons and make some money by sheer chance on one or two trades. But don’t think that this makes you a good trader.
What makes a good trader is the ability to create, refine, and execute a personal trading strategy with edge. This includes proper trading psychology, risk and money management, pinpointing key market levels, tracking and analyzing trades, and more.
There’s much more work that goes into it than most people think. Rolling out of bed a minute before the market opens and trying to copy trade alerts from some self-proclaimed guru just isn’t going to cut it. Durable trading success demands self-sufficiency.
STEP #2: Get Funded By Proving You Can Generate Consistent Profits and Appropriately Manage Risk
#1 Recommendation → Topstep Trader
Once legitimate trading skills are acquired with the help of a high-quality training program, you can then use your talents to earn a five to six-figure account through an established funded trader program – like Topstep Futures, for example.
There are a handful of funded trader programs available online, but they all work in essentially the same way. You’re given a simulated trading account and as long as you can hit the predetermined profit target without breaking any rules – you pass and get funded.
There’s typically a small fee of anywhere from $100 to $300 per month in order to participate in the tryout, but it’s important that everyone who participates has something on the line. This helps weed out the individuals who aren’t serious about their success.
Once funded, there’s also a profit split – usually somewhere around 70/30 (which means you keep 70% of the profits you generate and 30% goes to the funding firm). This is the funding firm’s reward for taking on the risk of funding you with a large account.
The best part about funded trader programs, in my opinion, is that they help traders avoid the usual costs of failure. Instead of risking thousands of dollars of your own personal capital, you can prove your abilities and trade risk-free with firm capital.
STEP #3: Use the Large Six-Figure Trading Account You Earned to Generate a Substantial Income
After developing legitimate trading skills and earning a six-figure funded account, you’re now in a position to realistically trade for a living. You’ve acquired the skills and capital necessary to extract a meaningful amount of profit from the market.
Your own $10,000 account (if you’re even lucky enough to have that at your disposal) would take several years of incredible returns just to get to break the $100,000 level. But with the help of a funded trader program, a large account can be earned in mere months.
To put this into the proper perspective in terms of the time and cost required in order to get to this point, we can use my top recommendation for training (Thomas Kralow) and my top recommendation for earning a funded account (Topstep Trader).
Thomas Kralow’s Complete Program is designed to take around four to five months to complete. Add a couple months of demo trading onto the end of that and you’re looking at five to six months of training. The Assisted version of the program currently costs $2,980.
Then for Topstep Trader, the tryout for a $150,000 futures account costs $375 per month. It’s possible to pass in as little as one month, but realistically speaking it will probably take three or four months. That could push the cost to around $1,500 in total.
So within about one year and spending roughly $5,000 of your own money, you can be in a position to potentially trade for a living. With legitimate trading skills and a substantial $150,000 account to work with, you can recoup your $5,000 with a 4% return.
Advantages and Disadvantages of This Approach to Day Trading For a Living:
Some people might think that spending up to one year training and developing legitimate skills is a long time, but trust me when I say that this timeline is actually short. Because of many missteps, it usually takes traders multiple years to find success.
For example, many traders make the mistake of going through lousy trading courses and alert services that promise foolproof systems to be learned in as little as a few days. But as great as these sorts of shortcuts sound, they’re completely ineffective.
If prospective traders actually focused on what matters right from the start – high-quality training and mentorship in order to build skills – then they would actually be on the fast-track. You think a year is a long time until you waste three chasing guru alerts.
Overall, the 3-step approach detailed above is cheaper and faster than the path that the typical new trader takes. Trust me, I lost over $20,000 on low-quality services and subsequent losses trading obliviously in the market – so I know exactly how this stage usually goes.
There’s no doubt that I should have used a portion of that money on legitimate training right from the start. Not only could I have saved over $15,000, but I could have saved years worth of time. I also could have started trading profitably much earlier.
You Don’t Necessarily Need to Risk Much of Your Own Capital in Order to Day Trade For a Living:
To close this article out, I want to plainly reiterate that trading for a living is not easy. Even after training for almost a year and earning a funded six-figure account, the pressure of relying on active trading as a sole source of income can be mentally draining.
Day trading simply isn’t like working a normal job with a set wage. The typical person is used to the same exact compensation every week, month, and year – they know exactly what to expect. But short-term profits from trading are much less predictable.
There can potentially be days, weeks, and months when you lose money, and handling those drawdowns from a mental perspective is extremely difficult to do – especially when you’re relying on trading profits to cover various living expenses.
I mention all this because the more financial and psychological pressure that is placed on a trader, the worse they typically perform. So try not to be fully reliant on your trading income in order to live comfortably – especially in the beginning stages.
As much as fake gurus try to criticize regular jobs, there’s no reason why you can’t train, earn a funded account, and eventually trade around a full-time job if you want to. Your schedule might be busier, but this relieves the pressure of fully relying on trading profits.
Overall, the majority of the risk that aspiring new traders should be taking at the beginning of their journeys, in my opinion, should not involve real money trading. Instead, the main risk should be time and money spent training and building legitimate skills.
Learn More in the Trading Success Framework Course
Written by Matt Thomas (@MattThomasTP)
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