What are the basic rules of day trading

The basic rules of day trading include: 1. **Knowledge**: Day traders must have a thorough understanding of the market, the stocks they plan to trade, and the latest market news. 2. **Realistic Expectations**: Day trading can be risky, and it's important to be realistic about profits and losses. 3. **Margin Trading**: Trading on margin can amplify profits but also increases risks. It's advisable to start without using margin. 4. **Price Targets and Stop Loss Orders**: Establish pre-fixed levels for entry and exit points to manage risks effectively. 5. **Limited Stocks**: Focus on a limited number of stocks, typically one to two, to simplify tracking opportunities and making informed decisions. 6. **Avoid Rush Hours**: Avoid trading during the opening and closing of the market when prices tend to be more volatile. 7. **Set Aside Funds**: Set aside a separate fund for day trading, keeping your main funds separate to avoid risking your essential finances. 8. **Diversify**: Diversify your portfolio to mitigate risks. 9. **Evaluate Stocks**: Evaluate stocks for day trading potential, considering factors such as liquidity and volatility. 10. **Use Limit Orders**: Utilize limit orders to set a specific price for entry or exit, helping to manage risks. By following these basic rules, day traders can improve their chances of success and minimize potential losses.