Insights > Experience

The Harsh Realities of Being a Day Trader in 2023

By WTT Master, Updated 28/05/2023
Day trading in the investment world has the enticing promise of a rags-to-riches transformation. It is alluring to consider purchasing and selling assets in a single day with the possibility of making big profits. But what is sometimes forgotten is the sobering reality that day trading can be a merciless career full of risks and difficulties. To illustrate the main issues and challenging realities faced by day traders, we at WayToTrade have examined the performance and experiences of many traders. Based on our findings.

Performance: High Chances of Loss

In trading, losses are always going to occur
The harsh reality of high loss rates is one of the main obstacles day traders must overcome. According to our data, 92% of traders lose all of their capital on their first day of trading. This number should be enough to discourage many would-be day traders. There is some optimism, though. Our research indicates that for people who try day trading again with a second account, the probability of losses drops to 73%. This decline can be attributable to the knowledge developed due to the initial failures. Additionally, applying risk management techniques can reduce the loss rate to 43%. To limit potential losses and make more informed decisions based on market analysis, risk management is essential for day trading. Day trading is inherently risky, as evidenced by a sizable percentage of traders still experiencing losses even when using a risk management approach.

Learn more about risk management in our article here

Psychological Pressure: A Lonely and Emotionally Taxing Profession

trading stress
Anxiety and depression are common among traders due to the high-pressure
The intense psychological strain associated with day trading is another hard reality. This is especially true for people who are working independently without assistance from a group or mentor. Due to the necessity for traders to make quick decisions that could significantly influence their financial well-being, market volatility can be incredibly stressful. The emotional toll might be made worse by the profession’s isolation. Day traders frequently battle stress and anxiety alone because they have no one to share their views and experiences or offer emotional support. Recognizing the psychological demands of day trading, as having coping mechanisms including regular breaks, emotional support, and stress-relieving hobbies, is crucial.

Black Swan Events: The Unpredictable Nature of Markets

Black swan effect
Black swans are world-changing events that are rare and difficult to predict
Dealing with continually shifting markets is a necessary part of day trading. Although traders use methods and analytical tools to forecast market moves, unpredictable events will always occur. These unanticipated occurrences, sometimes known as “Black Swan events,” can potentially wreak havoc on the market. A Black Swan incident can quickly wipe out significant amounts of wealth for a day trader. Even the most carefully thought-out plans cannot account for these unforeseen events. This demonstrates the value of diversity, the need for emergency money and backup plans, and the wisdom of not placing all of your eggs in one basket.

To mitigate black swan effects check the regime for each stock in our analysis section here


Day trading is not for those who are easily scared. It entails enormous risks, intense psychological strain, and a constant threat from unforeseen market developments. These harsh facts must be well understood by anyone seeking a career in day trading. They must also have the risk-management techniques, psychological fortitude, and financial safeguards to weather the inevitable storms. Knowledge, planning, and emotional fortitude are essential for navigating the turbulent waters of day trading, according to WayToTrade’s analysis.

WayToTrade’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of WayToTrade as a whole. Learn more in our disclosure page. 

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