Commodity day trading most commonly refers to the practice of buying and selling stocks during the day. By the end of the day, there has been no net change in position. For every share of stock bought, an equivalent share is sold. A gain or loss is made on the difference between the purchase and sales prices.

Studies have shown that the more money you have to trade in commodity, the better your chances of success. While some vendors (who want to sell you something) suggest you can trade with any amount you may have, most experts agree that with less than $10,000, your success depends on luck. You just don't have enough to diversify and apply proper risk management principles.

Risk is always commensurate with reward. If you are trying to "get rich quick," the high risks you will have to assume will probably break you. Commodity trading is not inherently risky. It is only as risky as you want to make it. Most people lose, because they can't control themselves or the urge to gamble. A disciplined person trading a solid, trend-following system with sufficient capital to diversify can reasonably expect consistent returns of 25 to 50 percent a year, with drawdown of 15 to 30 percent.

You won't find many people who have made a long-term career from commodity day trading. Short-term price data is too random to exploit. This has been demonstrated mathematically. The only way to trade successfully is to follow trends. The trends you follow must be large enough so that the average trade result is greater than the costs of trading. Day trading in commodity does not permit you to do this on a consistent basis. Long-term trading is much easier.