Sam has a folder on his phone called "goals." It's full of screenshots: a $14,000 day, a $9,200 morning, one captioned "just another Tuesday." He's been opening it on his lunch break for a month.

Tonight he does something different. He opens a calculator, types in his own number, $6,000, and asks it a simple question: what would a really good month look like for me?

The answer is the most useful thing he'll learn in Module 1. It's also the least exciting. This lesson walks you through the same maths with your own numbers, so you know what's realistic before you risk a dollar.

In 30 seconds

  • Research across the US, Taiwan and Brazil finds that most day traders lose money, and only a small minority profit reliably after costs.
  • Day trading income equals account size multiplied by net return, so a small account produces small income even with real skill.
  • Earning $30,000 a year from a $6,000 account would take a 500% annual return; the US stock market has averaged about 10% a year since 1928.
  • Costs (spreads, SlippageSlippage is the difference between the price you expected to receive when placing a trade and the actual fill price you got — it occurs because the market moved between when you placed the order and when it was executed, or because you usedRead definition →, fees, data, taxes) come out before you see any income, and most beginners should expect their first year to cost money, not make it.

By the end of this lesson you'll be able to read the research without hype or panic, calculate a realistic income RangeA range (or trading range) is a price zone where a stock oscillates between a defined support floor and resistance ceiling without making meaningful new highs or lows — price is consolidating rather than trending, and the dominant trade is Read definition → for your own account, and set a sensible goal for your first year. If you're new, start with Lesson 1: What Is Day Trading?

How much do day traders really make?

Most day traders make no money at all: academic studies of real trading records consistently find that the majority lose money after costs, and only a small minority earn reliable profits.

Here's what four well-known studies found:

Study
Jordan and Diltz (2003)
Who was studied
US day traders
What they found
35.8% made a net profit after commissions; about 1 in 5 was "more than marginally profitable"
Study
Barber, Lee, Liu and Odean (2014)
Who was studied
Taiwan, 1992 to 2006
What they found
Less than 1% could "predictably and reliably" earn positive returns after fees
Study
Barber, Lee, Liu, Odean and Zhang (2020)
Who was studied
Taiwan
What they found
97% of day traders were likely to lose money in future day trading
Study
Chague, De-Losso and Giovannetti (2020)
Who was studied
Brazil futures, 2013 to 2015, traders who kept going for 300+ days
What they found
97% lost money; only 0.4% earned more than a bank teller's starting salary

Why do the numbers range from "about a third profit" to "almost nobody"? Each study measures something different: one counts anyone who ended up in the green, another counts only traders who stayed profitable year after year. A trader can be up for one year by luck. Staying up for many years is much rarer.

Two findings matter most for you. First, the Taiwan researchers found that 74% of day trading VolumeVolume is the total number of shares (or contracts) traded during a given time period — it's the primary confirmation tool for all price action, because a price move accompanied by high volume indicates genuine market participation, while tRead definition → came from traders with a history of losses: people keep going long after the numbers say stop (Barber et al., 2020). Second, the Brazil study found no evidence that traders improved with experience (Chague et al., 2020). Simply putting in more screen time doesn't fix a losing approach.

So if most people lose, why does your feed look like everyone's winning?

Why does day trading look so easy online?

Day trading looks easy online because of survivorship bias: you only see the people who won, and the far larger group who lost stop posting.

Think about lottery winners on the evening news. You see the person holding the giant cheque. You never see a segment on the millions of losing tickets, even though they're the real story. A screenshot of a $14,000 day works the same way. It tells you nothing about the weeks before it, the accounts that blew up, or whether the person sells a course.

A useful habit: whenever you see a big trading result, AskThe ask is the lowest price a seller is currently willing to accept. When you buy with a market order, you pay the ask.Read definition → "how many people tried this and didn't post?" You'll rarely get an answer, and that silence is the point.

How do you calculate your own day trading income?

Your day trading income is your account size multiplied by your net monthly return, after every cost, which means the size of your account caps your income long before skill does.

In plain numbers:

Monthly income = account size × net monthly return

The net return depends on how often you win, how big your wins are compared with your losses, how many trades you take and what each trade costs you. Lesson 56: Win Rate vs. Risk/Reward shows how those pieces fit together. For now, the account-size part is enough to reset expectations.

Here's Sam's best realistic case. He imagines a year from now, when he's practised properly and is good enough to make a strong 1.5% a month after costs, which would be an excellent result for a newer trader.

Sam's best realistic case on a $6,000 account (hypothetical)

Account size$6,000
times Strong net return per month1.5%
equals Income per month$90
times Months12
equals Income per year, before tax$1,080

Ninety dollars a month. That's the reward for being genuinely good on a $6,000 account. Sam stares at it for a while, then deletes the "goals" folder.

Your account size sets the ceiling. Your skill only decides whether you ever reach it.

How big does an account need to be to live off day trading?

To earn a full-time income from day trading, you'd need either a very large account or returns far beyond what even professional investors achieve, because income is a percentage of the money you trade.

This table shows the annual return needed to earn $30,000 or $60,000 a year, before costs and taxes:

Account size
$6,000
Return needed for $30,000 a year
500%
Return needed for $60,000 a year
1,000%
Account size
$25,000
Return needed for $30,000 a year
120%
Return needed for $60,000 a year
240%
Account size
$50,000
Return needed for $30,000 a year
60%
Return needed for $60,000 a year
120%
Account size
$100,000
Return needed for $30,000 a year
30%
Return needed for $60,000 a year
60%
Account size
$250,000
Return needed for $30,000 a year
12%
Return needed for $60,000 a year
24%

DayTradingToolkit calculation: target income divided by account size. Costs and taxes would push every figure higher.

For comparison, the S&P 500 has returned about 9.9% a year on average since 1928, using Professor Aswath Damodaran's NYU dataset (A Wealth of Common Sense). Every row except the last asks you to beat that long-run average at least three times over, every year, while paying yourself from the account.

That's why most people who trade successfully do it part-time first, with an income that doesn't depend on the market. Lesson 3: How Much Money Do You Need to Start? helps you pick a sensible starting amount, which is a different question from how much it takes to live on.

What eats into day trading profits before you see them?

Day trading profits shrink before they reach your pocket because spreads, slippage, commissions, data and tools, and taxes all come out of your gross results first.

Gross trading results are not take-home income: every cost comes out first.
  • Spreads and slippage. You usually buy slightly above and sell slightly below the last price, and fast markets FillA fill is the execution of an order — when your buy or sell order is matched with a counterparty and the transaction is completed, you've received a fill.Read definition → you a few cents worse than planned. Each one is tiny. Hundreds of trades a month make it real. Lesson 34 and Lesson 44 explain both.
  • Commissions and fees. Many brokers charge no commission on stock trades, but small regulatory fees and other charges still apply. Lesson 16 covers the full fee menu.
  • Data and tools. Real-time data, charting and scanners range from free to a meaningful monthly bill. Lesson 20 shows what you actually need at each stage.
  • Taxes. In the US, gains on positions held a year or less are short-term capital gains, taxed at your ordinary income rate (IRS Topic 409).

Lesson 49: The Cost of Every Trade adds these up over 100 trades, and the total surprises most people.

What should you expect to earn in your first year?

In your first year, the realistic goal is to earn skill, not income: plan for the year to cost money, and set a fixed "tuition" amount you can lose without it hurting your life.

The research above explains why. Most traders lose, losing traders tend to keep going, and experience alone doesn't turn a losing approach into a winning one. What changes the odds is how you spend that first year: learning the basics in order, practising on a paper trading account before risking cash, then trading tiny size while you collect honest data about yourself.

Sam writes his first-year goal on a sticky note: "Learn. Paper trade. Lose less than $1,500 of the $6,000 if I go live. Keep the job." It isn't glamorous. It's a plan he can survive. Lesson 91: The First 90 Days turns that kind of goal into a month-by-month roadmap.

Myth and fact

Myth Good day traders make 5% to 10% a month, every month.
Fact 5% a month compounds to about 80% a year, and 10% a month to about 214% a year: about 8 to 21 times the S&P 500's long-run average of about 10%. Steady monthly claims that high are a reason for scepticism, not a target to copy.

Your turn: run your own income reality check (10 minutes)

0 of 5 done

Check your understanding

Check your understanding

A trader with a $10,000 account wants $2,000 a month. What monthly return would that take, before costs?

Check your understanding

Why does social media make day trading look more profitable than it is?

Check your understanding

What is the most realistic goal for a beginner's first year?

Key takeaways

  • Most day traders lose money; studies find only a small minority profit reliably after costs.
  • Income is account size multiplied by net return, so the account sets the ceiling.
  • A full-time income needs either a large account or returns far above the market's long-run 10% a year.
  • Costs and taxes come out before income, so gross results always overstate what you keep.
  • Treat your first year as tuition: learn, paper trade, trade small, keep your job.

Frequently asked questions

Is making $500 a day day trading realistic?
For most traders, no. There are roughly 250 trading days in a year, so $500 a day is about $125,000 a year before costs and taxes. That's a 500% annual return on a $25,000 account, or 125% on $100,000, far above the stock market's long-run average of about 10% a year. A $500 day happens to many traders; $500 every day is a different claim entirely.
Are the day trader salaries on job sites real?
They're real for a different job. Salary figures on job sites mostly describe employed traders at banks, funds and trading firms, who get a salary, company capital and professional infrastructure. An independent trader using their own account has no salary at all: income is whatever's left after losses, costs and taxes. Don't use those figures to plan your own trading income.
Do day traders pay taxes on every trade?
In the US, you owe tax on your net trading gains for the year, not on each trade separately, but gains on positions held a year or less count as short-term capital gains and are taxed at your ordinary income rate. Losses can offset gains, with limits, and special rules such as the wash sale rule can affect how losses count. Lesson 96: Day Trading and Taxes covers what beginners need to know.
Should I quit my job to day trade?
Not until your own trading records, over many months of live trading, show consistent profits after all costs, and your account is large enough to cover your living costs without taking big risks. Trading part-time around a job removes the pressure of needing every trade to pay the rent, and that pressure is what pushes many traders into bad decisions. Lesson 4 shows how to fit trading around work.

Up next: is day trading even the right style for you?

Sam's numbers are humbling. Ninety dollars a month on a great run makes him wonder something new: if day trading income is this hard, is day trading even the right style for him? Maybe holding trades for days, or simply investing, fits his noon shift and his $6,000 better. Lesson 9: Day Trading vs. Swing Trading vs. Investing lays the three paths side by side so you can choose with clear eyes.

Disclaimer

This lesson is for education only and isn't financial advice. Day trading carries a high risk of loss, and research shows most people who try it lose money. The income figures here are hypothetical calculations, not predictions or promises, and real results also depend on costs, taxes and your own discipline. Never trade with money you can't afford to lose. Read our full disclaimer.

Article Sources

DayTradingToolkit builds every lesson on primary sources and peer-reviewed research. These are the ones used here.