Do you consider yourself a gifted investor? Do you have the knack for making money by simply picking the right stock? If so it is possible to make money day trading online.

Day trading has come out of the shadows of bank offices and into the homes of millions of investors who have gained an understanding of how to buy and sell stocks online each day.

It is possible for some day traders to make hundreds of thousands of dollars each year. Some have made more than a million.

As with all stock trades your job will be to buy low and sell high. In this case you have a microcosm of a single trading day to maximize your profits.

If you don’t trade soon enough any gains could become losses and some of those losses could be catastrophic.

There are indicators that less than a quarter of online day traders actually make money long-term causing some to refer to this investment strategy as gambling. Some day traders will also borrow money (buy on margin) to complete the purchase of day trading stocks. This can result in either a feast or a famine when it comes to return. What may be more debilitating for the investor is when there are losses on borrowed funds. This scenario can be an exceptional burden when you need to repay the loan with nothing tangible to show for it.

The rule of thumb in this moneymaking investment strategy is to only accept risk to the degree you are willing to accept loss. If you could not afford to lose more than a thousand dollars don’t invest more than that amount.

The allure of day trading is the potential to gain profit quickly as compared to long-term tactics.

You will also find another ‘investment’ strategy online that has promised huge returns on your investment. In the early going many individuals have reported positive returns. Unfortunately this moneymaking idea is not one I can recommend.

Commonly referred to as High-Yield Investment Programs (HYIP) these programs allow investors to buy into a program with a small investment. Interest on the investment is typically paid daily and most investors will transfer their gains out of the plan each day.

A big problem with these plans is they can be closed at any time and your investment may be lost when an HYIP you are involved with closes down.

Some who have used this program indicate they have found acceptable returns, but many have left with either limited gains or a complete loss.

There are sites that promise to help you find the best HYIP programs available, but in many cases it is still a shot in the dark with very little information available regarding the companies you may be investing with.

The Securities and Exchange Commission (SEC) refers to HYIPs as ‘fraud’.

You can make money trading stocks and investing online, but it is not for amateurs or the weak of heart.

Day trading certainly has a better track record and reputation than HYIPs, but in both cases you could still wind up losing a lot of money. It is also possible to come away a big winner particularly from day trading.

Invest at your own risk.