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Best Trading Options for a Student ( Swing Trading, Daytrading, Investing Explained)

Last Updated on 10 February, 2024 by Rejaul Karim

Does being an investor or trader sound exciting to you? Well, you can become one even if you are still a student and haven’t completed your education yet. Things are not going to be easy, but if you know your options well and go with the right tactics, you surely can make significant sums.

As a student who wants to become an investor or trader, there are all sorts of options available to you. Some of them are better trading options while others are less-recommended ones. It is advised that you choose a type of trading that will not take much of your time, and allows you to make money and continue your studies simultaneously.

Swing trading is the best trading option for a student because it has the main two advantages you need in your life right now: it is simple to learn compared to other trading forms and it will not take much of your time.

However, many people, students included, are drawn to day trading and quick profits. However, as we will cover in this article, day trading is one of the worst forms of trading for students!

Best Trading for a Student
Best Trading for a Student

Why Day Trading Is a Bad Idea for Students

There are multiple types of trading out there. Of all the trading options students can choose from, there are some that are not recommended at all, especially if it’s your first attempt. One tempting trading form that you should avoid as a student is day trading. For various reasons, day trading can become more of a burden and will keep you from learning and growing.

Day trading is usually recommended to people who already have some experience in the field, and want to upgrade their knowledge by doing a more complex type of trading. Day trading requires skills and habits only gained through hard work.

Another reason why day trading is not recommended to students is that it consumes more time than other forms of trading. As the name states, day trading takes place during the course of a day and requires constant attention and regular trading activity to be successful. As a student, you have limited time on your hands, with all the courses, exams and studying nights. Day trading will only become a hindrance in your education and it will end up stressing you rather than helping you.

For more information about combining a full-time job or studies with day trading, we have written one stand-alone article on that very topic!

So, now that we have established that day trading is not a good choice for a student, let’s have a closer look at swing trading.

Related reading: Can You Learn Stock Trading in College?

Swing Trading: The Best Trading Form for a Student

Swing trading is widely considered one of the most beginner friendly forms of trading.  In swing trading, traders hold positions for more than one day, for longer periods of times that can last up to a few weeks. Traders that practice swing trading tend to follow the price movements and their ultimate goal is to generate a good risk-adjusted profit and outperform the market.

Swing trading is also known to be the type of trading positioned between day and position trading and is, as mentioned previously, one of the more simpler forms of trading which is why it is suitable for students.

So, how can you master swing trading as a student? Well, here is a list of things you should do when starting out!

Do not miss: What Is the Best Day Trading Course?

Swing Trading Starting Tips

For a student to master swing trading, it requires research, energy, and sometimes a good mentor. The financial markets are challenging, especially for someone who is just starting out. Even if you have a natural talent with numbers and feel you could successfully adapt to an ever-changing market, you need some preparation to do before you jump in. Here are a few things that you may want to consider doing.

Do Thorough Research

You need to have a clear view of what you want to achieve with the help of swing trading. For that, you will need to do some research on which market you want to hit, what stocks you are looking for, what budget you have, how much time you will dedicate to this activity, what are your objectives (both on short term and long term), what platforms you will use to trade stocks, etc. This may sound complicated, but some research will help you gain a deeper look into the field and gain some valuable insights.

Find a Mentor or a Teacher

An experienced person who can show you around can be a huge help at the beginning of your trading career. Trading is not easy and the learning process can be long and difficult, especially if you don’t have anyone to teach you. Imagine you are just buying your first stock – do you know where to begin? What if you lose money by mistake? Do you know the basics of this? Finding a tutor in trading, at least for the first couple of months, is priceless. The stock market is dynamic and can be challenging to understand. With the help of more experienced people, you will definitely become more confident as they can teach you how to become a swing trader in no time.

How Much Time Do You Need?

Time is very valuable for a student. So think about how much you will invest in this trading business not only financially, but in terms of time, energy and emotions as well. Control how much you will let trading consume your resources and always remember you are the boss here.

In our article on swing trading, we take a closer look at what swing trading is and what you need to know to start!

How to Manage Risk With Little Capital

It is clear that, as a student who wants to invest, you have one major downside when you are planning to start trading: you have little capital in your hands and probably almost no experience. So, you may not know how to start investing and make the right trades. It is recommended to look for a broker that will work with a small account in the beginning. This can give you time to increase the capital and become a more stable investor.

Managing risk is, however, difficult when you start out with little capital to invest. While it can be challenging, it is certainly possible. Start off by calculating the entire sum of money you can risk. Don’t forget that any type of investment involves a certain amount of risk, so you must be ready to face it. However, you can manage risk at some degree by asking yourself two very important questions:

  • What are my total available funds and what percentage of this sum is the risk capital?
  • What is my risk tolerance and how far am I willing to go?

When you have an answer to these two questions, you will also have a clear view of how conservative you will act on the financial market and how much you will be willing to risk from your capital fund. When it comes to risk management, you must always remember that with great risk comes great money OR great loss. While this all or nothing attitude may keep you going on the market at the beginning, finding a balance and investing wisely will keep you in business for the years to come.

A good rule of thumb is to never risk more than 2% of your capital on one single trade.

Finding a balance between Studies and Trading

Let’s face it, being a student is difficult as it is all the courses, exams, projects and grades you must juggle with. Trading is a serious commitment and it requires you to be more organized in order to always keep things under control. Here are some tips to help you to be a trader and a student at the same time and still have a social life:

Plan Ahead

Ok, so you want to get into trading and continue school as usual. It’s time to make a plan on how it will work out for you. Everyone is different, so it’s important for you to come out with your own plan. Be honest and try to think ahead by answering a few questions:

  •  How many hours will I need to research trading?
  •  How much time will I spend every day on the actual trading?
  • What amount of capital do I need to invest at first?
  • What objectives do I have for the near future?


It’s important to prioritize the activities you have in your life right now and see what is more important for you. Maybe you can still go to classes in the morning and trade in the evening or watch trends as you write your next paper. Just figure out a plan that works for you. It’s good to know that not everything is equally important and that sometimes prioritizing right can save you a lot of time and effort.

Stay Connected With Your Community

In order to combine your student life with your trading life, try to find places to work where your fellow students study or hang out. This way, you will continue to feel connected to the student community and be part of it while you take care of your own trading business. Who knows, maybe you will inspire some other students to join as well!

Long Term Investing Is Another Great Alternative

If swing trading doesn’t seem like a good option for you right now, what about long term investing? This type of financial strategy can help you grow a fortune step by step while still being a student.

Long term investing may be a good idea for a student because it’s not too time-consuming and focuses on long-term goals and achievements. A student who needs to focus on his studies right now may pick long term investing, since it doesn’t require daily monitoring.

Here are some good questions that you should ask yourself before you start investing:

  • What assets can you buy with your available capital?
  • What type of long-term investing (banking deposits, real estate, or insurance) would be more suitable for you right now?
  • How much time will this investment type take?

The best way of finding answers to these questions would be to discuss them with someone in the field who can help you decide and understand what can work for you right now.

Tips for Nearly Risk-Free Investments

If you are looking for less risk and nearly guaranteed profits, then investing in stocks or trading might not be a good choice for you. Regardless of which of the two you choose, there is always the risk of losing money, even if that risk can be made very small through good risk management and diversification.

If you are going for nearly guaranteed profits, you should look at minimal risk investments such as federal saving bonds, saving accounts, banking deposits, and other financial products that offer some type of protection for the investor. These products are considered some of the safest investments you can hold, but of course, this doesn’t come free. With less risk, there is also less profit to be made, and some of the safest investments forms, like savings accounts, might even sometimes struggle to cover up inflation.



What are the recommended trading options for students?

Swing trading is highly recommended for students as it is simple to learn, does not consume much time, and allows students to make money while continuing their studies.

Why is day trading not suitable for students?

Day trading is not recommended for students due to its complexity and time-consuming nature. It requires skills and habits gained through experience, making it challenging for students with limited time.

How can students master swing trading?

Students can master swing trading by conducting thorough research on markets, stocks, budgets, and time dedication. Finding a mentor, managing risk with little capital, and balancing studies and trading are essential steps.

How can students balance studies and trading effectively?

Students can balance studies and trading by planning ahead, prioritizing tasks, and staying connected with their academic community. Long-term investing is also an alternative for students who want less time-consuming strategies.

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