Day trading is risky but if you are going to do it, try the free demo account and follow this SureTrader review first
I rarely talk about day trading software on the blog but I do get a lot of questions about how to day trade. I thought I would share my (brief) experience trading and a review of the best day trading software I use.
Understand that the vast majority of investors that try day trading lose money, up to nine out of ten by most estimates.
Making money as a day trader comes from a combination of discipline, strategy and using a good trading software platform.
This day trading review will talk a little about strategy and what it means to be a successful day trader. I’ll review the trading software I used and the one used by many successful traders.
The discipline part is going to be up to you!
My Brief Experience with Day Trading and Trading Software
I trained with a day trading firm for a month in 2007 and worked as a trader for three months afterwards. I had some extra time in my schedule as an independent trade consultant (imports/export trade, not stock trading) and had always been curious about day trading.
What I saw was something entirely different from what most people think of as day trading.
Most investors think day trading is an easy way to get rich by spending a couple of hours in front of the computer each day with CNBC on in the background.
True day trading is a job and an extremely tough job at that. It’s physically and mentally draining.
Day trading firms interview and train hundreds but rarely keep on more than one-in-twenty traders. Traders usually put up some of their own money (around $10k to $30k) and can leverage their trades with the firm’s money.
You sit in front of your trading software all day while the market is open, up to ten or twelve hours for forex traders, and trade on your strategies. You keep the profits on your own money and usually up to 10% of the profit made on the firm’s money.
I experimented with day trading again last year to review the SureTrader platform, a popular day trading software recommended by a reader. I’ll be using that experience to discuss SureTrader fees, commissions and how to use the platform as an independent trader in the rest of the article.
What I learned from day trading:
- If you day trade stocks, you MUST follow a strategy and have the discipline to practice it all day while the market is open.
- Only about 1-in-10 day traders make money and only 1-in-20 stick with it for more than a year
What is SureTrader?
I tested SureTrader on a recommendation from a reader and because it offers a free $100,000 demo account for the software. I had no intention of day trading again but wanted to review the platform in case readers had any questions.
SureTrader was founded in 2008 and is a regulated broker. While most other discount brokers require as much as $25,000 in capital for day trading leverage, SureTrader allows you to open a money account for just $500 with a 6-to-1 leverage for day trades.
That means you can buy up to $3,000 in securities as long as you close out the positions at the end of the day.
That low minimum balance and leverage is what attracts most day traders to SureTrader. At 6-to-1 leverage, you amplify your day trading returns significantly.
It wasn’t the available leverage that attracted me to SureTrader, it was the free $100,000 demo account they offer to new traders. Without putting any money at risk, you can day trade on a trial account to see how you like the platform and how much money you make.
SureTrader offers three trading platforms for clients:
- SureTrader Active Web
- SureTrader Desktop Pro
- SureTrader Mobile
SureTrader Active Web is completely web-based so you can use it anywhere. That’s a big benefit for traders that need to be somewhere else during the day…maybe at a full-time job that’s paying the bills until day trading profits come in.
The desktop trading platform offers free real-time market quotes at no monthly platform fee including Level 1 Nasdaq and Level 1 NYSE and AMEX data. It also streams Bloomberg News live to keep you informed of breaking news that can affect your trades.
SureTrader Pro is designed for professional day traders that need more customization and faster point-and-click trade capabilities. The Pro software costs $49 a month but includes advanced charting, window linking, real-time trade P/L and programmable keyboard shortcuts that are a must for serious traders.
SureTrader Mobile is something of a combination of the two other day trading software products, offering all the mobility you need but with the extra features for professional trading. A monthly fee of $35 gets you access to the Active Web and Mobile platforms and ease-of-trading on your mobile device.
How Much Do Day Traders Make?
Finding estimates for average income day traders make is difficult because so many people do it independently and the trading firms don’t often share their numbers. Salary website GlassDoor updated their Trader Salaries survey for 2017 and estimated day traders make an average $90,000 though there’s a huge range from high to low.
Maybe one-in-ten are successful and that’s only counting traders that put in the time for training and trading every day. So understand that while successful day traders can easily make six-figure salaries, there are a lot more that lose money or quit within a few months.
That’s why I recommend everyone start with the SureTrader demo account first to see if they like day trading and test the software.
Trading costs on the SureTrader software are broken down into commissions/trade rates and SureTrader fees. Both are very low compared to other day trading software companies, attracting casual traders as well as professionals.
Traders have a choice between the three trading platforms above, each of which can be used to make real-money trades.
That means SureTrader fees start out at $35 or $49 for traders on the professional platforms. There are also data upgrades available like Level 2 data, CME futures data and other market depth features. Talking to a few professional traders, I found the average paid just under $100 a month for the data and features they needed for professional day trading.
There are some SureTrader fees for miscellaneous activity like the $40 withdrawal fee and a $50 inactivity fee for traders with less than 15 trades in three months.
If you aren’t making more than 15 trades in a quarter then you’re not really day trading and you’d be better off with another discount brokerage.
SureTrader fees are a very small portion of your total trading costs. Almost every trader spends many times over the amount in fees for trading commissions.
SureTrader Commissions and Trade Rates
The fact that trading commissions will be your biggest cost makes SureTrader’s rates extremely important.
SureTrader trade rates start at just $0.01 per share traded for U.S. stocks. That’s very competitive with any other day trading software I’ve seen but the platform really goes out of its way to attract active traders.
Active traders can get their per share trading costs down to less than half a penny and can join the Active Trader Program which includes more privileges.
Most new day traders are surprised how much trading the do in a single month so it can be fairly easy to get the lower rates on the SureTrader platform. Trading on 6-to-1 leverage and making 15 – 20 trades a day can easily get you the discounted $0.008 per share trading rate.
That still means over $2,000 spent on trading fees each month which shows you exactly how insignificant SureTrader fees are and the importance of SureTrader’s low trade rates.
Using the SureTrader software is extremely easy and the platform offers several tutorials on different features.
How you make money day trading will ultimately come down to your strategies and discipline to watch those strategies all day. Day trading isn’t something you do for an hour and then check back on the market at the end of the day.
Most day trading strategies look to gain a fraction of a percent on a successful trade but means a couple percent gain on 6-to-1 leverage. Understand that many trades are going to lose money so you are realistically hoping to net a few percent gain each day at most.
My two favorite day trading strategies are the momentum and reversal trends strategies.
- The momentum trading strategy looks to profit on stocks that are moving in one direction, either higher or lower. Traders use Moving Averages as technical indicators and look for chart patterns with no nearby resistance to stop the momentum. Look for high relative volume in the trading to confirm the direction. You also want to avoid stocks with potential headline risks like earnings that could disrupt the direction.
- The reversal strategy is really about finding momentum stocks with the potential to reverse direction. This includes stocks that are nearing resistance points in moving averages, relative strength indicators (RSI) below 10 or above 90 and with weakening volume that refutes the recent direction.
For either of these strategies, you want to ‘leg into’ your trades which means buying into the trade in pieces. You don’t go all-in with all the money you were planning on trading but maybe a third or half your bet first. That makes it easier to cut your losses quick or chase your good trades with more money before closing them out.
Check out the platform’s blog for more SureTrader tutorials and day trading education. The platform makes it extremely easy to put strategies in motion with point-and-click orders. You can customize your screen to show your open positions, unrealized profit and loss, as well as technical indicators you are following.
SureTrader Review Summary
Low trading fees and fast execution attract the professional traders to the SureTrader platform. I liked the free SureTrader demo account option and the easy-to-use trading software. It wasn’t quite enough to get me day trading again but it’s definitely something you need to try if you’re thinking about starting trading.
Things I liked about the SureTrader software:
- Low trading costs starting at $0.01 per share and lower for active traders
- Licensed and regulated broker
- 6-to-1 intraday leverage and a minimum of just $500 balance
- Free $100,000 SureTrader demo account
- Customizable trading screens that are easy to use with any strategy
Things I didn’t like about the SureTrader software:
- Still doesn’t mean you’ll make money as a day trader (I guess that’s not SureTrader’s fault)
- Withdrawal fee of $40 is annoying though the $50 inactivity fee isn’t usually an issue
- Regulated outside the U.S.
This SureTrader review isn’t meant to convince you to start day trading. While it is a very good income for many, I am still skeptical about day trading for most investors. If you are thinking about starting, try the free SureTrader demo account first to get familiar with the platform before you put your own money at risk. Follow the tutorials on SureTrader and learn everything you can about technical analysis.