Day trading refers to purchases and sales of market values that are made within one day, unlike normal trading. The history of day trading began in the 1970s together with the beginning computerisation of stock exchange trading. Private traders had the possibility for this kind of stock exchange transactions in the USA from 1996, one year later private day trading was also possible in Germany. However, day trading only became really popular through the Internet, as traders can track the prices of securities here in real time.

Daytrading makes it possible to take advantage of short-term price fluctuations of market values. Day trading makes it possible to open or close several trading positions in quick succession. By selling within one day, stock exchange traders want, among other things, to avoid price gaps that are difficult to calculate - the so-called gaps - and at the same time to make profits from small price changes. In extreme cases, traders buy and sell their market values within minutes or even seconds - such day trading is also called scalping in stock exchange jargon.

With regard to short-term traded market values, there are hardly any limitations - day trading is possible with shares, binary options or foreign exchange (forex values), for example. In practice, however, highly leveraged derivative financial instruments such as CFDs play the largest role in day trading. CFDs (Contracts for Difference) are speculative securities that, unlike a stock, are not based on a real value but function as a bet on the performance of an underlying. At the beginning of the term of the contract, the provider and buyer of a CFD exchange an underlying (shares, foreign exchange or even crypto currencies) for a financial security of the buyer that is significantly lower than the value of the trading object. At maturity, it is sold at the current market price.

Gains, but also losses in CFD trading are mainly realized via so-called levers, which result from the difference between the actual value of the money security deposited by the buyer (share, currency, etc.). The leverage effect of CFDs results in very high profit margins with comparatively low stakes, but also high risk of loss. In addition, this can result in extremely high additional funding obligations for the buyer of the securities, which, however, have been legally excluded on stock exchanges within the EU since 2017.

For day trading, this rule means that positions whose money security is depleted due to short-term price fluctuations are closed immediately by the trading platforms - resulting in a total loss for the buyer. CFDs can be concluded as long or short contracts. In the first case, a bet is placed on an increase in the price of the trading asset; in the case of a short contract, a profit is generated by price losses. Gains through short trading are realised by stock exchange traders through so-called short selling:

If they expect prices to fall for a value, they sell it first in order to buy it back later at a lower price. In essence, then, it is a matter of speculation about a renewed rise in the share price. With leveraged products such as CFDs, the return opportunities increase.

Day trading with crypto currencies works like day trading with any other market value. Due to its very high volatility, the crypto market is particularly well suited for this form of trading. The exchange rates of crypto currencies often show very strong fluctuations within one trading day, which result in very attractive yield opportunities for cryptotrading.

Crypto day trading can be compared to trading on the foreign exchange market (Forex, FX). Forex traders do not speculate on the price development of a single currency, but on the price changes between currency pairs - for example between the US dollar and the euro.

The Forex market is also highly volatile. As a rule, derivatives such as CFDs are traded instead of individual currencies. There are now also predefined currency pairs for crypto currencies on the one hand and CFDs and other derivatives and leverage products on the market on the other. They are issued by the various brokers who are active in the crypto market.

Day trading with crypto currencies is possible both with reference to conventional means of payment - for example US dollars or euros - and to other crypto currencies.

In 2017, the market for crypto currencies developed very rapidly. For a long time, the public debate focused above all on the hype surrounding the Bitcoin, whose exchange rate literally exploded in the second half of the year. However, the growth trend in the crypto market was also driven by various other digital currencies.

There are now over 1,400 crypto currencies on the market. Its current market capitalization (status: February 2018) is USD 470 to 480 billion. By comparison, the market capitalization of digital coins at the end of 2016 was only 17.7 billion US dollars. Although the cumulative market capitalization of the crypto currencies has declined somewhat since the beginning of 2018, market observers continue to discuss whether it could approach the USD 1 billion mark in the course of the year.

To date, only a relatively small group of crypto currencies is relevant for trading, which includes several newcomers in addition to established values such as bitcoin, ethereum and ripple. However, the latter in particular make it clear that the further development and establishment of new blockchain business models is an essential aspect of the digital future and an important driver of the crypto market. In the meantime, not only the digital currencies but also the underlying technology have arrived in the mainstream. Blockchain innovations are now of interest not only to Internet start-ups, but also to the established FinTech industry, banks, major corporations and countries. This also opens up new perspectives for the crypto currency market:

Although the bitcoin remains the largest digital currency, the winners will increasingly include complete blockchain ecosystems such as Ethereum, Cardano or the Ripple network and the associated crypto currencies. Their upswing, but also the success of Bitcoin Cash, are also an indicator that the original Bitcoin blockchain no longer optimally meets the needs of users in terms of transaction volumes and speed. Against this background, the crypto market will continue to diversify - thus offering active traders an ever broader spectrum of trading opportunities.

The following examples illustrate the price trends for the crypto currencies Iota, Ripple and Bitcoin Cash Trading opportunities that have emerged in the crypto currency market over the past year. Traders with long-term investment strategies profited above all in the second half of 2017 from the generally positive performance of the most important crypto currencies, day traders achieved their profits due to the in part very high volatility of digital money, which became increasingly important especially since the fourth quarter of 2018 due to rising exchange rates.

Anyone who had acquired a bitcoin at that time was able to sell it on December 31, 2017 for $13,411, the market capitalization of the digital currency had grown to around $225 billion. The high flight of Bitcoin began in the 2nd quarter of 2017 and was unstoppable thereafter. Day trading bitcoin also means taking advantage of medium to large fluctuations in the exchange rate.

The market capitalization of the crypto currency Iota currently amounts to 5.73 billion US dollars. In mid-February 2018 their exchange rate was 2.11 US dollars. Since the appearance of Iota on the crypto market, the exchange rate of this currency has been very volatile. In addition, the share price has risen significantly since the end of October 2017 - still with very strong daily fluctuation margins. The relatively new digital currency reached its all-time high on 20 December 2018 at an exchange rate of 5.24 US dollars. On the crypto market, it was considered an attractive trading object for traders right from the start.

The market capitalization of the crypto currency Ripple (XRP) was 43.75 billion US dollars in mid-February 2018, and its current exchange rate was 1.13 US dollars. In the ranking of crypto currencies, the ripple currently occupies third place after the Bitcoin and Ethereum. After the Ripple had initially recorded hardly any relevant appreciation since 2014, its exchange rate to the US dollar rose for the first time in the second quarter of 2017.