The stock market has been challenging for most investors recently, but some people are still making money. One way to do this is by day trading because success in day trading is driven by stocks that are volatile and ones that trade in large volumes — two things that are prevalent in this current market.
Here’s what you need to know about day trading and the best day trading stocks for 2023.
What Is Day Trading?
Day trading is the practice of buying and selling the same stock position — or option — within the same trading day. Day traders watch their stock positions carefully, trying to choose the best time to buy and sell in order to maximize their profits.
Here is a look at some of the best day trading stocks for 2023.
|Company||Stock Ticker Symbol||52-Week Price Range|
|Meta Platforms Inc.||META||$108.32 – $338.39|
|Apple Inc.||AAPL||$124.17 – $198.23|
|Amazon.com Inc.||AMZN||$81.43 – $147.29|
|Carvana Co.||CVNA||$3.55 – $57.19|
|Peloton Interactive Inc.||PTON||$4.28 – $17.83|
|Farfetch Ltd.||FTCH||$1.31 – $9.87|
|AMC Entertainment Holdings Inc.||AMC||$7.05 – $91.50|
|Marathon Digital Holdings Inc.||MARA||$3.11 – 19.88|
|Nio Inc.||NIO||$7.00 – $16.18|
|Tesla Inc.||TSLA||$101.81 – $299.29|
|Nvidia Corp.||NVDA||$138.84 – $502.66|
|Block Inc.||SQ||$38.85 – $89.97|
|Advanced Micro Devices Inc.||AMD||$60.05 – $132.83|
|Etsy Inc.||ETSY||$58.20 – $149.91|
When choosing stocks to day trade, look for stocks with high volume and high volatility. You want stocks whose price moves significantly, either by a percentage of the stock price or by dollar amount. Stocks with lower prices will move by greater percentages, whereas higher-priced stocks will move by greater dollar amounts.
Here are some factors to consider.
A stock’s beta represents its volatility compared to the overall market. The benchmark for beta is the S&P 500, which has a beta of 1.0. A stock with a beta higher than 1.0 is more volatile than the market; a stock with a beta lower than 1.0 is less volatile than the market. A stock with a beta of 2.0 is twice as volatile as the market.
When day trading, look for stocks with betas greater than 1.0, but remember that you may not want the stock with the highest beta you can find — it could expose you to unnecessary risk.
Stocks that trade in low volumes are not likely to have significant price swings, so look for those that are being actively traded.
Pay attention to the volume of shares being traded as well as the number of outstanding shares. For example, suppose two stocks are both trading 10 million shares a day. But stock A has 100 million shares outstanding and stock B has 500 million shares outstanding. Ten percent of stock A’s shares are trading hands each day, while just 2% of stock B’s shares are moving. Stock A has more trading volume.
Look at the 52-week high and low prices for the stock. If the range is large, it may be a good choice for day trading.
You can also look at the average day range. This is the average spread between the high and low each day and indicates intraday volatility. This metric is available on some trading platforms that cater to day traders.
Best Stocks for Day Trading in 2023
Here’s a look at some of the best day trading stocks to consider for 2023.
1. Meta Platforms Inc. (META)
Meta is the name of the company that owns Facebook. Day traders won’t see the returns this stock produced in the early days, but there still may be some upside here. The company’s beta is 1.21. The average trading volume is 20.73 million shares, out of 2.22 billion shares outstanding. Over the past 52 weeks, the stock price has ranged from $108.32 to $338.39.
2. Apple Inc. (AAPL)
Like Meta, day traders of Apple are not likely to see the gains that were made early on. Nevertheless, its recent volatility makes this stock worth watching. The average trading volume of Apple is 58.93 million shares, and the company has 15.55 billion shares outstanding. The company’s beta is 1.30. Relative to some others on this list, the 52-week range is narrow, from $124.17 to $198.23 per share.
3. Amazon.com Inc. (AMZN)
Amazon rounds out the “big three” on this list. Its beta is 1.17, in line with Meta and Apple. The average trading volume is 52.1 million shares out of 10.33 billion shares outstanding. Amazon’s 52-week range is $81.43 to $147.29 per share.
4. Carvana Co. (CVNA)
Carvana has a beta of 3.09, making it significantly more volatile than the overall market. It has an average trading volume of 8.58 million shares, out of 84.5 million shares outstanding. Its 52-week range price range is $3.55 to $57.19.
5. Peloton Interactive Inc. (PTON)
Peloton has been in the news for its volatility but has a moderate beta of 2.02. Since beta reflects the stock’s movement over five years, its recent volatility may be higher than indicated. Peloton stock has an average volume of 13 million shares out of 342.43 million shares outstanding. Its 52-week range is $4.28 to $17.83.
6. Farfetch Ltd. (FTCH)
Farfetch, an e-commerce luxury fashion retailer, has a beta of 3.08. Its average trading volume is 15.54 million shares, and the company has 352.61 million shares outstanding. Over the past 52 weeks, its stock has ranged in price from $1.31 to $9.87.
7. AMC Entertainment Holdings Inc. (AMC)
One of the original so-called “meme stocks,” which fluctuated wildly in price due to day traders who communicated on Reddit, AMC has a beta of 2.11. The stock trades an average volume of 23.39 million shares out of 198.36 million shares outstanding. The price has ranged from $7.05 to $91.50 per share over the past 52 weeks.
8. Marathon Digital Holdings Inc. (MARA)
Marathon Digital Holdings‘ beta of 5.18 suggests significant volatility. It’s also active, with an average trading volume of 32.14 million shares out of 222.62 million outstanding. In the past 52 weeks, the share price has ranged from $3.11 to $19.88.
9. Nio Inc. (NIO)
Electric vehicle maker Nio, based in Shanghai, China, has a beta of 2.10, making it twice as volatile as the S&P 500. The company’s average trading volume is 43.88 million shares, and it has 1.78 billion shares outstanding. Its 52-week price range is $7.00 to $16.18 per share.
10. Tesla Inc. (TSLA)
Tesla, another electric vehicle maker, is more than twice as volatile as the overall market with a beta of 2.28. The company has 3.18 billion shares of stock outstanding, and on average, 120.55 million of them change hands each day. The stock has a 52-week price range of $101.81 to $299.29 per share.
11. Nvidia Corp. (NVDA)
Nvidia has a beta of 1.69 and an average trading volume of 49 million shares out of 2.47 billion shares outstanding. Its 52-week range is $138.84 to $502.66. These metrics mean it’s less risky than some of the other stocks on this list, making it a good choice for beginners. Keep in mind that this means it may not deliver the returns that others might in a single day, but day traders who time it wrong shouldn’t lose as much, either.
12. Block Inc. (SQ)
Formerly known as Square, payment processing company Block’s stock has a beta of 2.34. Its average volume is 12.82 million shares out of 553.57 million shares outstanding. Over the past 52 weeks, the stock has ranged in price from $38.85 to $89.97 per share.
13. Advanced Micro Devices Inc. (AMD)
Chipmaker AMD’s stock is more volatile than the S&P 500, with a beta of 1.65. Of its 1.62 billion shares outstanding, about 56.17 million change hands each day. AMD’s 52-week price range is $60.05 to $132.83 per share.
14. Etsy Inc. (ETSY)
E-commerce juggernaut Etsy has a beta of 2.02. With a smaller market cap than many companies on this list, Etsy’s average trading volume is about 3.55 million shares out of the 119.75 million shares the company has outstanding. The company’s 52-week price range is $58.20 to $149.91 per share.
Is day trading worth it? It can be. Strategies like scalping, where you buy a large number of shares and sell them almost immediately to profit from small price increases, can be quite lucrative. However, day trading is not for the faint of heart because you can lose a lot of money in a very short amount of time. But by doing some research and watching your picks carefully, you may find success — and have a little fun at the same time.
Daria Uhlig contributed to the reporting for this article.
Data is accurate as of Nov. 15, 2023, and is subject to change.