Day Trading sounds fun right? You see people turning hundred dollars into
millions all the time on YouTube or social media in general. Well, even though I am a
full-time day trader. I just gotta be honest here, Day trading is probably NOT for you.
Hello everyone. My name is Shay, aka HUMBLED TRADER. I’ve been day trading for over 7 years
now. In this video I want to talk about the 3 reasons why you shouldn't day trade. So if you are
interested in seeing more beginner content like this, please remember drop a like and subscribe.
First reason, and it’s perhaps the most critical one you shouldn't day
trade if you are struggling financially. 6;30 I strongly believe if you cannot pay your bills,
if you don't have a job providing you a stable income, and if you are
drowning in debt, you shouldn't day trade. I know this might be an unpopular opinion,
and I'm sure I’ll get some heat for this since we live in a world rampant with stories of
rags to riches stories on social media. Is so common today to see people turning
a small amount of YOLO money into millions in one trade. Like the wallet that bought
SHIB tokens last year and turned that $8K into billions of dollars in one trade.
And for many audience or readers, they’d think they can achieve the exact same thing.
In psychology, this is called survivorship bias. “Survivorship bias is the tendency for
people to cherry-pick people or strategies that successfully made it through a selection process
and ignore all those that failed. People tend to focus on these survivors, even if they survived in
large part due to luck rather than viability.” It is that phenomenon that causes us,
even myself included when I first started as a brand new trader. To have that false
confidence to think that if I see two people out of 100 turning $1000 into millions, then that
means I definitely could do the same too. And it’s that false confidence and lack of
media coverage that makes us overlook the other 98 people out of this group of 100,
who lost their $1000 instead. Which is the other side of the story we rarely hear about.
When I first started trading, yes I admit I fell for that survivorship bias I mentioned earlier. I
thought I could get rich quickly because of all the things I read online.
But, the big difference here is I had a 9 to 7 job. So even if I lose my entire trading account,
which by the way I did, I still would not be devastated financially.
Again, I had my employment income to pay the bills. That is a big difference here. If you
have a stable income and you want to start day trading with some small accounts on the side and
start learning. Definitely do what you want as long as you are financially stable.
I’m not here to discourage people from day trading,
but what I am cautioning against, is to put your last $1000 in your bank account to day trade.
Especially if you don’t have a job. I think that would be extremely risky and devastating.
There are going to be people out there encouraging you to spend the last $1000
into “investing in yourself” and purchase education programs to learn to trade,
investing, cryptos, amazon FBA, shopify etc. I’m really against that. I think the right way
to invest in yourself is to make sure you use that money wisely to pay your rent, pay your bills.
When someone asks me on Instagram or Youtube me that they have one last $1000 in their bank
account and they want to trade with me. My first response is, I’m sorry,
but I don't think you should day trade. Don’t purchase my Academy if you are struggling
financially. If you really want to learn trading still, you can check out my playlist below called
day trading for beginners. It’s free, there’s tons of content and knowledge there for you to learn.
I know this may sound discouraging, but this is tough love. I'm saying this as your sister,
your friend, or as some may even call me their trading mom.
Yes believe it or not I did get some mother’s day cards from my HT members on mother’s day.
So this is what they mean by I don’t have any kids, that I know of.
I genuinely believe that you can only become profitable day trading as a beginner trader if
you focus on the learning first and take initial small losses as market tuition and pay your dues.
If you are struggling financially, you will likely throw stops & risk management out of the window.
So if what I just described sounds like you. Please keep that last $1000 to pay your bills.
And look for a job that will allow you to live a stable life.
Once you have your life together then sure, if you are truly passionate about day trading,
then perhaps it’s worth revisiting this business. If you have a job, and you are doing fine
financially. Then do whatever you want. Whether that's yoloing everything in Gamestop, AMC,
or SHIBa inu. You do you it's your money. The second reason you probably shouldn't
day trade is if you are looking to get rich quick. Now this is something we’ve
talked about many times on this channel. Day trading is not a get-rich-quick scheme.
Did I think I could get rich quickly following chat room alerts 7 years ago? Yes, I’m guilty.
And did I actually get rich in 1 month? No! In fact, all of those services things like copy
trading, chat room alerts or signals, are very likely going to lead you
to blow up your small trading accounts. Sure you may make $50 here, $100 there
following someone else’s alerts to buy or sell. But it all takes is one time to lose $200,
$500 or even 1000 dollars. Because following alerts teach you nothing.
You don't know the proper way to plan your trades which includes entries, exits, and STOPs.
How to manage your risk, so even if the trade goes against you, you keep the loss controlled.
But you can live to trade another day. That's the reason many beginner traders
had roller coaster PNLs in their first year. It’s because they only focus
on the illusion of quick and easy money, instead of planning out their risk-reward beforehand.
That's why we call it risk-reward in trading, not reward risk.
Like we mentioned earlier in reason #1, day trading requires you to pay tuition to the market.
We all start out losing money in trading as a beginner. Whether you like to admit it or not.
But you get to decide how much to lose. Only those who start focusing on planning
their trades and trading their plans before clicking buttons will make it in this game.
This business is a trial by fire. So, if you want to get rich and make millions tomorrow
as a beginner. Day trading is not for you. The third reason you shouldn't day trade. As
if you are incapable of critical thinking and taking responsibility for your own actions.
Day trading is not like a normal 9-5 job, where you go in to work for your boss,
and whether you do well or slack off, you are guaranteed a paycheck.
This is a business where you are 100% responsible for your own actions and profit or loss. In fact,
you could show up to “work”, and still lose money. At the same time, you could also do
the right things and make huge profits. Whether it's a loss or a win, you are solely
responsible for your trading account balance at the end of the day. This is a business where you
need to make judgment call for your own account your own trading style and risk tolerance.
One trader may see a good long opportunity and buy the stock on the way up. While the other
trader may see a short setting up near resistance. There is no right or wrong answer. There is only
trade management and following your own setups. Whether you press the buy or sell button or no
trade at all that is entirely up to you. As traders, we need to be introspective and
review each win or loss. Where are the areas we can work for next time? How can we improve our
strategies or manage our risk better next time? These are all reflections and thinking you should
be doing for yourself after each trading day. Sure, it would be easy to always blame the
pumpers, the alerts, and how the market is rigged when you lose money. But what happens
when you make money? Do you attribute some of those gains to the same people?
I don’t have the answer to those questions. But I know for myself,
whether I make it big or lose big, I take full responsibility for my own actions in trading
and of course for my own broker account.
If I lose, it's no one else's fault, and if I profit, those gains belong only to myself too.
Until the CRA enters the door. You don't have to be smart or have an MBA
in finance or economics to day trade. But you do need critical thinking skills and be mature
enough to take responsibility for your own decisions. Otherwise, trading is not for you.
Remember kids, day trading is a risky business. If you are struggling financially,
if you think you could get rich quickly or if you cannot take responsibility for your own actions,
then day trading is definitely not for you. Again, I'm not trying to be discouraging.
I'm just being real and not feeding you the Kool-Aid. This is tough love. However, if
none of the reasons we just talked about apply to you, then feel free to learn from my day trading
for beginner’s playlist down below in the video description, and make sure to like and subscribe
if you want to see more in the future! Thank you guys, so much for watching as always,
I’m the humbled trader. And I will see you guys next time.