Day Trading: What Is It and How to Maximize Profits

In Vietnam, the stock market applies a T+2 settlement cycle, which significantly limits investors’ ability to implement flexible trading strategies. However, on international exchanges, day trading là gì and why has it become a popular method of earning money among millions of traders?

Understanding Intraday Trading

Day trading là gì? Simply put, it is a short-term trading method where traders buy and sell the same asset within the same trading day, leaving no positions overnight. This approach exists across many markets—from Forex, stocks, to cryptocurrencies.

Those who pursue this style are called Day traders; they exploit small price fluctuations over short periods to generate profits. Although the holding time is very brief, with a clear strategy, returns can be achieved daily or even hourly.

Key Features of This Trading Method

Day trading has distinct characteristics:

First, traders rely on analyzing small timeframes—such as 15 minutes, 30 minutes, or 1 hour—to find entry opportunities. Unlike long-term strategies, day trading requires continuous observation of price charts throughout trading hours.

Second, the number of open positions is very high—usually from 5 to 30 trades per day depending on the strategy and profit targets. Many small trades add up to the day’s profit.

Third, tools and equipment are crucial. You need a stable computer system, fast internet connection to receive market signals, and execute orders promptly.

Clear Advantages of This Method

Quick profits are the main reason many traders choose this approach. At the end of each day, you can precisely calculate your income for today; if you use leverage skillfully, returns can multiply exponentially.

Another benefit is that you don’t have to worry about holding positions overnight. Since you do not keep trades overnight, you can be fully confident in the news released after trading hours.

Additionally, overnight (overnight fee) costs are significantly saved. Many derivative contracts have high fees, so closing trades within the day helps reduce trading costs.

Challenges to Face

The downsides of this method are also considerable. Day trading requires almost all trading hours dedicated to technical analysis, chart reading, and finding optimal setups. Your personal and family time will be significantly affected.

High psychological pressure is another challenge. Making many trades in a short timeframe can cause fatigue, stress, and lead to poor decisions. Moreover, your system equipment must be modern and stable; technical glitches can cause missed opportunities and losses.

Main Markets for Day Traders

The three largest markets that short-term traders focus on are:

Forex Market: Major currency pairs like EUR/USD, GBP/USD are most popular due to high liquidity. You can trade 24/7 with various currency pairs.

Cryptocurrency Market: Bitcoin, Ethereum, Solana, and other large-cap coins are suitable. Investors can trade on both the existing (Spot) market and the derivatives (Future, CFD) markets.

Stock Market: Exchanges with T0 settlement cycles allow flexible intraday trading. With Apple, Microsoft, Alibaba, and other companies, traders have many options.

Requirements to Become a Successful Day Trader

Knowledge and experience: Traders lacking market understanding often suffer losses. Technical analysis is a must, but understanding the characteristics of each trading product is also essential.

Sufficient capital: Day traders should only use capital they can afford to lose entirely. An appropriate amount of capital relative to trading volume will protect you from (margin call) and bankruptcy.

High discipline: The best strategy is useless if not executed with discipline. Follow the principle of “plan your strategy and trade according to it”; never trade based on emotions.

Effective Starting Steps

The first step is to open a demo account and practice your strategy. Understanding theory is different from mastering execution; markets daily present new situations, and only continuous practice allows you to react quickly.

Practice for at least 3 consecutive months with stable profits on a demo account before using real money. Start with a single market to accumulate experience, then expand to new markets.

When choosing a trading platform, prioritize those with competitive, transparent trading costs, support for small trading volumes, and provide a demo account for practice.

Day Trading or Swing Trading?

These two methods are very different. If you enjoy the thrill, are willing to take high risks, and have time to monitor frequently, day trading is more suitable. If you prefer a more cautious approach, willing to hold positions for several days, swing trading is a good choice.

Conclusion

Day trading requires focus, patience, and high discipline. If you learn to trade properly, you can build a steady income source. Before starting, ensure you understand the basic principles, have appropriate capital, and are always ready to manage risks. With modern analytical tools today, there has never been a better time to explore the world of financial trading.