What proportion of day traders find themselves profitable? – Data Science Society (2024)

Approximately 1–20% of day traders actually profit from their endeavors. Exceptionally few day traders ever generate returns that are even close to worthwhile. This means that between 80 and 99 percent of them fail.

What proportion of day traders find themselves profitable? – Data Science Society (1)

What exactly is day trading?

Day trading is when you buy and sell stocks in a short amount of time, usually within a single day. The objective is to make a small profit on each trade, which will compound over time.

With the rise of online stock brokers like Robinhood and cheap or free trades, day trading has become a way for small investors to make a lot of money in a short amount of time, even though it is very risky.

“Successful day traders treat it as a full-time job, as opposed to trading between business meetings or over lunch.”

In practice, however, day trading is difficult for retail investors to profit from. Brad Barber of the University of California, Davis, did a study in 2010 that found that only 1% of day traders are always making money.

The study studied trades from 1992 to 2006, a span of fourteen years. The few people who do make money consistently spend their days trading, and it becomes their full-time job instead of something they do between meetings or at lunch.

If this all sounds like a bit more risk than you’re comfortable with, you may do what many investors do and engage in long-term, buy-and-hold investing in a diversified portfolio of low-cost index funds and ETFs.

Invest regularly in the account and allow the growth of companies to drive your portfolio’s long-term gains.

Long-term investing is significantly more likely to increase your wealth than day trading. Still, if you want to trade stocks every day, you should first learn as much as you can about the process.


  • Day traders purchase and sell stocks and other assets during the trading day to profit from the quick price variations.
  • Day trading utilizes an extensive array of tools and strategies to benefit from these perceived market inefficiencies.
  • Day trading, which is often based on a technical analysis of how the market moves, requires a lot of self-discipline and objectivity.

The Day Trading Success Rate

Day trading has a 4% success rate as a source of income. The actual rate I saw during my many years of trading at a proprietary trading firm and in discussions with other firm operators.

10% to 15% of prop firm trainees could make some money through day trading (a side activity). For many, their earnings were insufficient to warrant their time.

These individuals spend more than six hours each day at the office, day trading five days per week. They had access to capital and knowledgeable traders to ask inquiries (few did).

Six to twelve months was the minimum time required to earn a living through trading (I had a part-time job up till month 7). Some individuals took longer. Nobody is shorter.

Investing less effort or time lengthens the journey or decreases the success rate.

I believe poor success rates pertain to “I’ll give it a shot” individuals (most ppl). NOT those with love for trading. People with passion do whatever it takes. Give-it-a-shot people… try and fail.

“But I see so many people making a fortune; it must be simple!” This is an example of availability bias: accepting what is visible without contemplating what is not visible. If people talked about losing, you probably wouldn’t follow them on social media.

Follow those that seem to know what they’re doing when studying! It is the only world you can see, but it is not the only one in existence.

How to Be in the Top 4% (or 10%) want to at least swap. If you intend to only “test it out,” you should not bother. Mondays are the favorite day of the week for traders.

Devote a minimum of six months to learning a single approach. Inconsistency and experimentation lengthen the path to profitability.

The act of logging hours is not a practice. Only deliberate practice is relevant. Reviewing errors, generating remedies, and identifying ways to marginally increase risk/reward and win rate.

Confidence comes from doing something repeatedly until you believe in it and know you can do it. Most worries about “trading psychology” can be solved by practicing the strategy until it feels natural.

You do not consider money or produce money. You carry it out, as with any other repeated duty in life. That is only achievable if you consistently trade in the same manner. You will lack (justifiable) confidence and profitability if you are always attempting new things.

The Day Trader Success Rate

During my tenure at the proprietary trading firm, before leaving to trade independently, I witnessed a large number of aspiring day traders apply, but only a handful was accepted.

In order to become professional day traders, these people were willing to go through many interviews, sign contracts, and make a promise to show up every day while following risk management rules. These were, at least superficially, committed individuals.

Approximately 2,000 traders passed through the doors of my firm and other proprietary firms over the years, based on talks with their owners. The rate of success was about 4%, where success was defined as being able to make a living from the markets, which only sometimes means making a lot of money.

So, of the approximately 2,000 inhabitants, approximately 80 could trade for a living. The remaining 1920 gave up, departed, or were terminated.

These individuals trained and practiced for six to eight hours each day, every weekday. They had access to funds and assistance from successful traders, but only some utilized it. And yet, only approximately 4% of day traders could make a living from the trading.

The day trading success rate, including those who were somewhat lucrative but unable to support themselves, was likely between 10% and 15% of those who walked through the doors. These people might have kept trading as a side job, but they needed to make more money to support themselves.

If you want to make a living from day trading, your chances are about 4% if you have adequate funds and invest several hours daily for at least six months. Early streaks of good fortune do not count. I’m discussing regular month-to-month profits.

The majority of profitable traders required at least five months to accomplish so. For four months, I suffered (minor) financial losses. I earned a small sum in my fifth year, the equivalent of part-time work in my sixth, a minimal amount sufficient for subsistence in my seventh, and continued to increase from there.

It will depend on your income objectives, the amount of capital you have, and the profitability of your trading plan. Here are some potential profit scenarios for day trading FX. For day trading in stocks, you need at least $25,000 to start, and you can often get 4x leverage. With that level of capital, success is feasible. Futures trading can also be initiated with minimal capital.

The likelihood of making a living through day trading is unlikely if you lack enough funds and time to invest. It is conceivable, but it will take a great deal of effort and dedication to growing a tiny account into a source of income.

If you want to earn money on the side, you will still need the same level of commitment, putting in months to refine a system and fighting self-destructive inclinations. But the chance of meeting these lower goals is higher, with a success rate of 10 and 15%.

These numbers could be better. There are numerous factors to consider. But, conditions at the trading firm(s) were quite beneficial, and it is undeniable that most people could only make money slowly and slowly.

See the whole approach for day trading and dominating the market in less than two hours per day. My course on forex day trading will teach you how.


Approximately 1–20% of day traders actually profit from their endeavors. Exceptionally few day traders ever generate returns that are even close to worthwhile. This means that between 80 and 99 percent of them fail.

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What proportion of day traders find themselves profitable? – Data Science Society (2024)


What proportion of day traders find themselves profitable? – Data Science Society? ›

Conclusion: Approximately 1–20% of day traders actually profit from their endeavors.

What percentage of day traders are profitable? ›

This is an important point to consider for anyone considering day trading as an investment strategy. Only 3% of day traders make consistent profits. Day trading is a risky endeavor, with only a small fraction of traders able to make consistent profits.

How much money do day traders with $10,000 accounts make per day on average? ›

With a $10,000 account, a good day might bring in a five percent gain, which is $500. However, day traders also need to consider fixed costs such as commissions charged by brokers. These commissions can eat into profits, and day traders need to earn enough to overcome these fees [2].

What is the success ratio of traders? ›

The win/loss, or success ratio, is a trader's number of winning trades divided by the number of losing trades. The win/loss ratio can indicate how many times a trader will have successful, money-making trades relative to how many times they'll have money-losing trades.

Do day traders make money research? ›

The most obvious risk is losing money—sometimes all of it. Few day traders consistently earn a profit over time. Therefore, consider spending your time and money on other, more productive activities and types of longer-term investing.

What is the failure rate of day trading? ›

Risks of day trading

Some did slightly better than others, with the best pundit achieving a 68% accuracy rate (and the worst an accuracy rate of 22%). Success rates among average traders are even lower, with some estimates suggesting the number of people that lose money is as high as 95%.

Can you make 100k day trading? ›

Can You Make 100k a Year Day Trading? For a day trader to make 100k a year trading, they need to make $397 per day since there are 252 trading days. Most day traders are not profitable, though.

What is the average income for a day trader? ›

How Much Do Day Trader Jobs Pay per Year? $56,500 is the 25th percentile. Salaries below this are outliers. $105,500 is the 75th percentile.

Can a day trader be a millionaire? ›

While it's possible to become a millionaire through day trading, it's not likely. Most traders end up losing money in the long run. A small number of traders, however, are able to consistently make money and achieve success.

Can you make 200 a day with day trading? ›

A common approach for new day traders is to start with a goal of $200 per day and work up to $800-$1000 over time. Small winners are better than home runs because it forces you to stay on your plan and use discipline. Sure, you'll hit a big winner every now and then, but consistency is the real key to day trading.

What percentage of traders actually make it? ›

Conclusion: Approximately 1–20% of day traders actually profit from their endeavors. Exceptionally few day traders ever generate returns that are even close to worthwhile. This means that between 80 and 99 percent of them fail.

What is the 1% rule for traders? ›

The 1% rule demands that traders never risk more than 1% of their total account value on a single trade. In a $10,000 account, that doesn't mean you can only invest $100. It means you shouldn't lose more than $100 on a single trade.

Can you live off day trading? ›

In summary, if you want to make a living from day trading, your odds are probably around 4% with adequate capital and investing multiple hours every day honing your method over six months or more (once you have a method to even work on).

How realistic is it to be a day trader? ›

High probability of losses.

A study of 1,600 day traders over the course of two years found that 97% of individuals who day traded for more than 300 days lost money. Succeeding in day trading takes more than diligence and education, but a significant amount of luck.

Who made millions in day trading? ›

Steve Cohen. Steve Cohen's day trading tale is one of a kind. Being the most successful among day traders who made millions, he started as a poker player. His passion for day trading would lead him to develop abilities in day trading and intuitiveness.

Are most day traders profitable? ›

The same study found that the majority of trades, up to 80%, are unprofitable. While some day traders end up successful and make a lot of money, they are the exception rather than the norm. If you want to try day trading, start small and do not commit your entire investment account.

How many trades does the average day trader make a day? ›

A day trader might make 100 to a few hundred trades in a day, depending on the strategy and how frequently attractive opportunities appear. With so many trades, it's important that day traders keep costs low — our online broker comparison tool can help narrow the options.

Why do 90 percent of traders lose money? ›

Because the investment amount is not fixed, they invest most of their money in the stock market. Due to which they do not have enough money even for emergency times. And when they need money, that's when the market is going downhill. Due to which they have to withdraw money from the market by making losses.

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