How Many Day Traders Make Money? | Day Trading Statistics (2024)

Key Findings

• 64% of all US day traders lose money, and only 36% realize profits.
• Active day traders in the US underperform a value-weighted index by 10.3% annually.
• 90% of all active day traders are male.
• 66.3% of all day traders are white. The share of white day traders has been in decline in recent years.
• Relative to population size, Asian Americans have the highest number of day traders in the population.
• Bitcoin is the most preferred trading instrument, followed by Gold and the EUR/USD currency pair.

What Percentage of Day Traders Make Money?

The success rate of day traders is an elusive figure, but several studies and reports have attempted to quantify it.

One study examined the profitability of 324 US-based day traders. It established that 64% lost money and only 36% realized profits in the duration of the study^[1].

A paper published in the Journal of Finance in April 2000 revealed that active day traders in the United States underperformed a value-weighted index by 10.3% annually.^[2].

How about in other countries?

A study examining the success rate of Taiwanese day traders found that only about 19% of all day traders made positive returns in 2011.^[3].

Three years later, a concept paper by the same researchers posited that on any given day, 97% of day traders lose money net of trading fees^[4]. Again, the conclusion was predicated on a study of the Taiwanese market.

Another study published in 2020 covering the Brazilian equity futures market established that only 1.1% of the surveyed day traders earned more than the country’s minimum wage net of fees. Also, only 0.5% made more than the initial salary of a bank teller^[5].

Demographics of Day Traders

Let’s look at who’s engaged in day trading.

Day Traders by Race

A typical American day trader is white, Zippia data shows. According to the data, 66.3% of day traders in the US are white, 11.5% Hispanic or Latino, 12.4% Asian, and 5.5% Black or African American. The Native Americans make up just 0.2%.

Table 3: Day traders in the US by race

A BrokerNotes survey of the global online trading landscape (of which day trading is a subset) found that of the estimated 9.6 million online traders, 33% are Asian. North America and Europe account for around 16% apiece, and 14% are in Africa. The day trading landscape is not unique in terms of racial composition. Instead, it is just an extension of the broader online trading ecosystem^[8].

Zooming out, the US data shows a declining share of white day traders. For example, Table 4 reveals that white day traders claimed a larger share of the population in 2020, at 73.73%, than in 2021, at 66.26%. Likewise, the number of Black or African American day traders is also lower than before, declining by close to one percent between 2010 and 2021. In contrast, more Asians and Hispanics/Latinos have joined the day trading space. According to Table 4, the number of Asian day traders in the US increased by over 4% between 2010 and 2021. Similarly, US Hispanic/Latino day traders increased from 10.24% in 2010 to 11.49% in 2021.

Table 4: Day trader race and ethnicity over time

What Is the Most Preferred Trading Instrument?

Young traders prefer trading cryptocurrencies, according to a recent UK survey. The findings align with the latest ranking of the most active trading instruments worldwide^[10]. According to Investing.com, Bitcoin is the most preferred trading instrument, followed by Gold and the EUR/USD currency pair^[11].

Average Daily Trading Volumes by Asset Class

Although day traders prefer cryptocurrencies like Bitcoin, they trade other instruments heavily, including stocks, forex, and bonds. Based on the daily trading volumes, stocks are the most traded, by day traders and other categories of traders, with a $239.8 billion average daily trading volume in 2021^[12].

Table 8: Average Daily Trading Volumes of Different Asset Classes for Day Traders