Watch Bullet Train 2022 full movie on Netflix.. Download Bullet Train movie

 

Daily income of stock trader (daily profit from stocks)

How much is the profit of stock trading? This is not an easy question to answer. The difficulty boils down to what each trader is trading, how much they trade, how much capital they have, how much leverage they use, and the stocks they trade. Simply put, there are too many differences to be reduced to a single summary number. To answer the question about how much daily profit from stocks is, we need to check several scenarios and hypotheses that will provide you with useful information that may help you while trading in this financial market.

We first need to understand the difference between a regular stock trader and a day trader. The average stock trader enters the market for the long term, i.e. for a few months or possibly years, while a day trader might sell the stock he just bought on the same day. This means that the daily profit from the shares that they managed to make is different from each other.

Assumptions of daily profit from stocks: the day trader

The income that traders earn varies depending on the trading strategy and risk management methods as well as market knowledge and experience. This is why it is almost impossible to accurately quantify the profits of stock trading in numbers.

While discussing this point, it is also important to identify several factors around day trading. It should be noted that if you are trading in the US stock market, you need a large capital to be able to day trade. As per US law, a minimum deposit of $25,000 is required for daily trading.

Here are the best and worst case scenarios to better understand the daily profit from stocks:

best scenario

Let's say you started trading with $25,000. In most cases, stock brokers will offer you a leverage ratio of 4:1, which means you can buy $100,000 worth of shares. Let's say you buy shares of $50 each. Given the leverage level, you would buy 2000. Your goal is to get a profit of about $0.5 per share but are willing to risk about $0.2 per share.

Now let's say you make about 5 trades every day. Since there are usually 20 trading days in a month, ie 100 trades in a month. Now let's say 40% of your trades were successful. This means that 40 times out of 100 you made $1,000 in your trades (because 0.5 x 2,000 = $1,000), so your total profit is $40,000 (40 x 1,000 = 40,000). On the other hand, you fail 60% of your trades. This means that you lost a total of $24,000 (because 0.2 x 2,000 = 400 and 400 x 60 = $24,000). So your total profit is 40,000-24,000 which equals $16,000. It is very likely that all of your trades will have a certain amount of commission (let's say it was $20 per trade), i.e. you have to pay $2000. The final sum you get is $14,000 per month, which is 56% of your initial investment.

Remember that this scenario is hypothetical. Getting a large number of successful trades in a row is almost impossible.

worst case scenario

Perhaps the worst case scenario is the opposite of what we said above in our hypothesis. According to the same situation, let's say 20% of your trades were successful. This means that 20 times out of 100 you made $1000 on your trades (because 0.5 x 2000 = $1000), so your total profit is $20,000 (20 x 1000 = 20000). On the other hand, 80% of your trades fail. This means that you lost a total of $32,000 (because 0.2 x 2,000 = 400 and 400 x 80 = $32,000). This means that you incur a loss of $12,000.

Remember that this scenario is the most likely reality as the markets are unpredictable when it comes to day trading.

Assumptions of daily profit from stocks: the average trader

The average trader enters the market with the intention of trading for the long term, i.e. they buy the shares and hold them for a few months or maybe years. The stocks that common investors buy are usually dividend stocks. This means that every share they own brings them a specific annual income.

Let's say you buy $30,000 worth of company stock, for example. You get a total of 1,000 shares, which means that each share is worth $30. The company then commits to paying you an annual dividend of the shares you own. The percentage here can be quite diverse, it could be 1% or maybe even 20%, it all depends on the company. Let's say it's 15% in this scenario. [1]

If the stock price hasn't moved for one year, you can expect $4,500 at the end of the year, which means you make $375 a month without moving a single muscle. However, traders should not forget that the stock price can go up over the years, which means annual profits increase as well.

Most people tend to deposit all their savings into dividends and then live off them. But this method is not guaranteed for financial security, market failures can seriously damage the source of salary of a stock market trader, as happened in 2008 and 2020 for many people when the financial crisis happened all over the world and many people lost huge amounts of money.

Stock trader monthly income

The amount of money a trader makes depends on several factors such as the amount of capital, the level of leverage and the stocks they are trading in. There is a big difference between a regular stock trader and a day trader, stock traders open for a long period of time compared to a day trader who trades in a very short period.

The income of a day trader depends on which direction the market will perform and the percentage of leverage they will use, but they can make a lot of money if the market goes up. And if there is no market crash or sensitive period in the global economy, regular stock traders are able to reap huge profits from their long-term trading.

Frequently Asked Questions About Daily Profit From Stock

Who is the richest stock trader? Warren Buffett is one of the richest stock traders in the world. As of May 2021, his net worth is $73 billion. He managed to make all this money by investing in the stock market only. Warren adopts a very unique trading strategy and manages to stay on top even as the global financial market was dealing with a crisis. He earned a lot of money during his career which is why today he is considered one of the richest traders in the entire world.

How much profit daily stock trading? It is impossible to say precisely how much you can make by day trading the stock market. People using these strategies use different methods of generating money, so the total amount of their earnings also varies.