10 Best Day Trading Stocks in 2024

Day trading stocks isn’t for the faint of heart. Buying or selling the same stock on the same day, often using borrowed funds (trading on margin), is a high-risk, high-reward strategy. It requires good timing, an understanding of market dynamics and economic indicators, as well as a tolerance for a high level of risk.

For day trading to be lucrative, it’s best to invest in stocks that have high trading volume and high volatility. Stocks investors are enthusiastic about are likely to produce the kind of price moves day traders can profit from. The secret is buying stocks that have strong price swings but also are solid long-term investments. That way, if a stock’s price plummets, you can hold onto it until it eventually comes back around to a gain. For those eager to try their hand at this strategy, we reviewed the best stocks available in US markets for day trading. Read on to see our picks:

An in-depth look at these top stocks for day trading

Now, let’s take a more detailed look at the most popular day trading stocks and why they are worth considering. All of these stocks have double-digit average annualized returns over the past decade.

1. Nvidia: 10-year average annualized return of 74.54%

The rapid growth of generative AI applications, and cloud infrastructure should continue to power the GPU maker’s sales for years to come. That’s good news for a company benefiting from strategic AI innovation collaborations with Amazon Web Services, Google Cloud, Microsoft and Oracle, among others.

The company posted a strong set of fiscal first quarter earnings. It saw revenue rise 262% year over year to $26 million, led by data center revenue of $226.6 billion, which was up 427% from the same period last year. 

Nvidia has a high gross profit margin of 75%. Its earnings per share (EPS) in the quarter was $5.98, up 629% year over year. The big gains led the company to raise its quarterly dividend by 150% to $0.10. A stock split that took effect on June 7, has made Nvidia’s shares even more approachable for beginner investors. Analysts’ consensus estimates point to another record quarter for revenue at $28.52 billion, a tick up from Nvidia’s own guidance.

Even so, the stock has slipped a bit recently as concern about a recession have hit the market as a whole. Also, investors are anxious about the potential for more chip restrictions by the US government on sales to China, which would hurt Nvidia. There are also reports that Nvidia’s new B100 and B200 chips based on its Blackwell architecture could be delayed because of a design flaw. The current slump, though, gives the stock a better price point for day traders to enter. Also, any developments on the above can produce fluctuations worth exploiting for day trading.

2. Tesla: 10-year average annualized return of 29.01%

Tesla is one of the most popular stocks with day traders. It always has high volume and liquidity, making it an easy stock to buy and sell. Based on market cap, it’s a more valuable stock than all the other major automaker stocks combined. The company has a strong market share among EV maker as well as among charging stocks, making it a growth stock in two areas.

Tesla, though, seemingly came out of nowhere to produce the best-selling vehicle in the world, the Model Y sport utility vehicle, along with four other Tesla EV models. It’s also the only EV maker to be consistently profitable. Last year, it reported its fourth consecutive year of net profits. In addition, Tesla is ideal for day trading, given the volatility of its shares. The stock, now trading at around $206, went from $1 a share in 2010 to a high of $415 a share in November of 2021. So far this year, the shares have fallen 17%, but its volatility and ability to bounce back make it a day trader’s dream.

In the second quarter, the company had revenue of $25.5 billion, up 2% year over year. While automotive revenue was down 7%, sales in energy generation and storage (up 100%) and services (up 21%) made up for that. However, EPS did fall 46% to $0.42, owing to lower selling prices for some Tesla vehicles, restructuring charges and higher operating costs driven by AI projects.

3. Starbucks: 10-year average annualized return of 11.61%

Starbucks, which has nearly 40,000 stores, most of them in the US and China, and a legion of loyal customers, announced on Aug. 13 that Chipotle CEO Brian Niccol is taking over over as its new CEO. Subsequently, the stock jumped 20% on the news. That’s exactly the type of price move breaking news can trigger and what day traders can exploit. The company’s former CEO, Laxman Narasimhan, is stepping down after only one year at the helm.

Niccol, who led Chipotle’s shares to new heights in his six years at the helm, could bring new life to Starbucks stock. The shares slid after meh third-quarter earnings, in which revenue fell 1% year over year to $9.1 billion, and EPS was down 6% to $0.93.

Starbucks hasn’t adjusted well to customers cutting back on eating and drinking outside the home due to inflation. It’s also losing market share to independent coffee shops in the US and low-cost rivals in China and elsewhere.

4. Eli Lilly: 10-year average annualized return of 31.48%

Healthcare stocks can be great day trading stocks because they can soar when a company gets a new drug approved. In Eli Lilly’s case, though, its rise is because of an encouraging second-quarter report.

Lilly had second-quarter revenue of $11.3 billion, up 36% year over year, and EPS of $3.92, up 68%. Sales of celebrity-backed diabetes/weight loss therapies Mounjaro and Zepbound drove the sales. Mounjaro had $3.1 billion in second-quarter sales and Zepbound notched $1.2 billion in revenue in the quarter. The two drugs are different formulations of the same drug, tirzepatide. 

Thanks to the duo’s growth, the company raised full-year revenue guidance by $3 billion. Breast cancer therapy Verzenio also had a strong sales jump, rising 44% year over year to $1.34 billion. It also said it expected full year EPS of between $15.10 and $15.60, compared to $5.80 last year.

In addition, the company has a huge pipeline with several promising late-stage therapies, including 20 in Phase 3 trials. And that doesn’t even include recently approved Kisunla to treat early-stage Alzheimer’s disease. 

5. Meta: Average 10-year average annualized return of 20.94%

At a time when other tech stocks have slumped, Meta is up 48% this year, and has gained more than 3.4% over the past month. It’s faring better than other “Magnificent 7” stocks because it’s backing up the AI hype with high margins and strong financials. To that effect, Meta is one of the leading companies promoting open-source AI. Its Llama 31. 405B is the biggest open-source AI large language model, meaning it can generate human language text in several languages.

Regarding its finances, in the second quarter, Meta said it had revenue of $39.07 billion, an increase of 22% year over year. Daily active people, a metric the company uses to measure how many unique users open any of its apps on a daily basis, was 3.27 billion in June, up 7% year over year. Ad impressions increased by 10% from the same period a year ago. Meta forecasts third-quarter revenue to be between $38.5 billion to $41 billion, compared to $34.15 billion in the third quarter of 2023. Earnings surprises or disappointments also often serve as triggers for price swings that day traders can jump on.

6. Microsoft: Average 10-year annualized return of 26.42%

There’s a lot of hype regarding AI, but Microsoft has been one of the legitimate beneficiaries of the technology. The company has a strong portfolio of diversified assets and has a high gross profit margin of 70%. It has been able to hold onto its market-leading positions in software while building its business through acquisitions.

Microsoft has recently closed its 2024 fiscal year and it was hard to find fault with the company’s continued growth. Revenue was 245.1 billion, up 16%, net income was $88.1 billion, up 22% and EPS was $11.80, up 22%. One big driver for the growth was its Xbox content and services revenue. That was up 61%, thanks to the impact of the company’s Activision $68.7 billion purchase in 2022. Microsoft Cloud services revenue was also strong, rising 21% year over year in the fourth quarter.

The company’s Copilot platform, which embeds AI into its software, could be a big game-changer, particularly if Google’s struggles with its own AI search engine continue. Companies that already use Microsoft 365 or its other software can easily dip their toe into generative AI by using Copilot to do mundane tasks to improve productivity. Analysts have said that 50% of Microsoft’s users will adopt Copilot for business by 2028, adding $20 billion to the company’s revenue by the next fiscal year.

7. Visa: 10-year average annualized return of 15.3%

Visa’s shares are up less than 1% so far this year, but the company continues to be one of the most traded stocks, with a 30-day average trading volume of more than 26 million. It may be a surprise to many that Visa doesn’t actually issue cards. It earns revenue from fees it charges the 14,500 banks and other card issuers for its branded products, including credit cards, debit cards and cash access programs. All in all, the company continues to see steady growth in payments volume, cross-border transactions and processed transactions.

In the third quarter, Visa reported double-digit growth in revenue, EPS and net income. Quarterly revenue was $8.9 billion, up 10% year over year. Net income totaled $4.9 billion, up 17% over the third quarter of 2023. EPS climbed 20% to $2.40. The company’s gross margin was above 77%, making it more profitable than other highly traded stocks.

While a recession could set back the company on its heels, in the long run, Visa should continue to gain from the switch to digital payments that accelerated during the pandemic. It’s also set to benefit from the rise of e-commerce. Visa’s bread and butter is the 1% to 4% commission it earns from every transaction its network processes.

8. Advanced Micro Devices: 10-year average annualized return of 45.13%

AMD is a leading provider of CPU technology for desktop computers, as well as servers. It also sells GPU graphics technology, high-performance computing HPC and AI processors, field programmable gate array (FPGA) processors and network accelerators. It’s in a good position to benefit from demand for AI-capable PCs because it’s one of the few companies that makes the processors for the technology.

In the second quarter, AMD gained market share from leader Intel in regard to data center sales, and now holds 24.1% of the data center CPU market. It had revenue of $5.8 billion in the quarter, up 9% year over year. EPS was $0.16, soaring 700%. The company has recently premiered its AMD Ryzen AI 300 Series processors, its third-generation processor for AI PCs, with 50 TOPs of AI processing power for Windows Copilot+ PCs, as well as OEMs, including Acer, ASUS, HP, Lenovo and MSI.

AMD also released guidance for the third quarter, saying it expected revenue of $6.7 billion, give or take $300 million. At the midpoint, that would be 16% growth from the same period of last year. It expects non-GAAP gross margin of roughly 53.5%, slightly above the 53% it reported in the second quarter.

9. Apple: 10-year average annualized return of 25.78%

It’s hard to ignore the company with the largest market cap in the world ($3.45 trillion at last count). Its sheet size makes it a great stock for day trading, and guarantees liquidity. While it’s justifiably known for its hardware sales (iPhone, Mac, iPods, etc.), the company is also seeing huge growth in services, which should improve its margins.

In the third quarter, Apple had revenue of $85.8 billion, up 5% year over year, and EPS of $1.40, up 11% in the same period. The big driver for stronger profitability was services revenue. While product revenue was $61.5 billion and had a gross profit margin (GPM) of 35.3%, services revenue was $24.2 billion, with a GPM of 73.9%.

Another reason to be bullish on Apple is its pending release of its iPhone16. The latest iPhone will integrate Apple Intelligence. Its iPhone contract-manufacturer Foxconn has already increased hiring due to the anticipated high demand for the phone. Morgan Stanley has projected that revenue from Apple’s iPhone segment will jump to $485 billion by fiscal 2026. The introduction of Apple Intelligence will lead many users to upgrade their phones and other Apple devices.

10. Amazon: 10-year average annualized return of 26.59%

Amazon is a market leader in US e-commerce and as a cloud platform merchant through Amazon Web Services. Its strong niche is expected to propel earnings for years to come. On top of that, the company is diving headlong into AI-enhanced services. To demonstrate this, in the second quarter, launched such AI-powered features as shopping assistant Rufus for all US mobile customers, playlist generator Maestro for Amazon Music, and a new search experience for Fire TV.

The company’s diversity of revenue gives it a bulwark against recessionary pressures. It’s seemingly in everything, from healthcare to television and film production. In the second quarter, Amazon posted revenue of $148 billion, up 10% year over year. North American e-commerce sales were the biggest contributor at $90 billion, rising 9% from the same period a year ago. AWS saw sales rise 19% year over year to $26.3 billion. The growth of data centers, and AI will likely accelerate sales for its AWS segment.

Amazon expects sales of between $154 billion and $158.5 billion in the third quarter, a jump of between 8% to 11% from the same year-earlier quarter. In addition, it predicts operating income to grow to between $11.5 billion and $15 billion, compared to $11.2 billion in the same period a year ago.

Year-to-date performance of the best stocks for day trading

What is day trading?

Day trading is an investment strategy when individuals buy and sell stocks, currencies and options in the same trading day. The traders pursuing this strategy take advantage of short-term price fluctuations. Instead of worrying about long-term growth of their stocks, day traders are looking to profit from small, daily price movements, making big bets on those movements.

The point of day trading is making a quick profit and then getting out to limit risks. Day traders often make multiple trades during the day and some use the leverage of margin accounts to multiply their profits.That means they borrow money from their broker to wager more funds in their positions. It’s a high-risk strategy that requires a lot of research and technical analysis.

Because they don’t intend to hold their stocks for a long time, day traders don’t need to worry about what kind of dividend they have.

Some of the best stocks for day trading are well-known companies that engender a lot of investor enthusiasm. Day traders exploit that enthusiasm, when say, the market overreacts to bad news, knowing the pendulum will likely swing back. They can, by shorting the stock, gain from good news, knowing the hype will spike the stock, but it will come back down. The reason you want stocks with high trading volume is they often have more liquidity. This means less play between the expected and actual price of a stock. 

How to choose stocks for day trading? 

Any stock could be suitable for day trading, given the right circumstances. Ideally, you want stocks that are well-known, where information about the company is abundant.

Furthermore, it’s important to choose stocks that have a relatively high level of volatility and a high daily trading volume. That will give you a better opportunity to enter the stock at the price point you want and to exit it at a certain price point.

What type of stocks are best for day trading?

The best stocks for day trading are companies that see a large volume of trading, allowing day traders to more easily get in or out of a position at a certain price.

It’s also wise to pick companies with solid track records, because if you are unable to get out of your position at the desired price, you still want a stock with good long-term prospects.

What is the difference between day trading and investing? 

The difference between the two is in the timing. On the one hand, day trading is all about having a short-term focus, buying and selling securities within the same day to capitalize on small price movements. It’s associated with frequent trading and due to its reliance on volatility, involves a relatively high level of risk. On top of that, transaction fees and slippage can eat into profits, especially for high-frequency trading.

On the other hand, investing requires a long-term focus. It means holding onto investments for months, years or even decades and looks to generate returns through capital appreciation and dividends, and in some cases, dividend reinvestment. It requires patience and usually means less-frequent trading. As investing is less reliant on market fluctuations, it’s considered less risky than day trading.

What are the main types of day trading?  

Day trading encompasses a variety of strategies, each with its own risk profile and potential rewards. Here are five of the most popular day-trading strategies.

Scalping

The point of scalping is to quickly buy and sell securities, holding positions for seconds or minutes, just long enough to make money. Investors basically invest big in small price movements. It’s the most short-term style of investing and is best done with stocks that have a high level of liquidity, though it can be done with any type of stock. It also helps to have a broker with low transaction costs and one that can execute trades rapidly.

Gap Trading

Gap trading occurs when traders try to benefit from price gaps that are present when the market opens. Basically, this happens when a stock opens at a significantly higher or lower price than what it closed at the day before. Traders then buy or sell based on their expectation of where the stock’s price will go next.

To do gap trading well, you need to understand market news and events that might drive a stock’s price during non-trading hours, such as a quarterly report or other important news that might affect the company. Traders that use gap trading need to have a clear entry and exit plan. Gaps can be upward, when the opening price is higher than the previous day’s high, downward, when the opening price is lower than the previous day’s low or be an exhaustion gap, when an upward or downward movement at the opening signals a reversal of a trend.

Momentum Trading

Momentum occurs when traders find securities with a strong upward or downward momentum and try to buy a stock when the price is riding. Essentially, that means riding a wave of enthusiasm toward a particular stock. To do this successfully, investors need to be able to quickly identify trends and use stop-loss orders to minimize risk.

The key to momentum trading is the ability to pay attention to a stock, identify and buy early when an upswing occurs. Then, as soon as the stock begins a downward movement, traders sell it to lock in a gain. Traders essentially work with volatility to find short-term uptrends, often buoyed by market news. Then they sell it when the stocks lose momentum.

Breakout Trading

Breakout trading happens when an asset moves above or below a support or resistance level. It usually means the stock will continue moving in the breakout direction. For a breakout to succeed, it requires higher than normal trading volume to continue because it shows there’s significant conviction the stock will continue to move in a particular direction.

Contrarian trading

Contrarian trading is based on the assumption that a security whose price has been steadily rising or declining for a while is due for a correction. Using a contrarian strategy, a day trader will look for signs of an impending reversal in price direction and trade accordingly.

Range Trading

The point of range trading is finding securities that trade within a specific price range. Day traders may then buy when the stock reaches the lower end of the range and sell when it reaches the upper level of the range. It means identifying support and resistance levels for the stock and then using stop-loss orders to minimize risk in the trade. Traders using this method need to research the technical elements of a security’s price history and understand market volatility.

News-Based Trading

The point of news-based trading is looking at current news reports and then using the information to quickly decide whether to buy or sell a stock. In some cases, this may mean seeing an overreaction to news and betting for a reversal, whether it means a rise or a decline. To do day trading on a stock based on news reports, you need to understand whether the news will have a long-term impact, a short-term impact or no impact at all. Often, traders will see a stock rise or fall based on news, then buy or sell similar companies in the same sector based on that information, something called the sympathetic effect.

What type of day trading is most profitable?

All of the above methods have their proponents and depending on the circumstances can be quite profitable. Oftentimes, the most profitable type of day trading is breakout or contrarian trading. The reason is that instead of depending on small price fluctuations, these involve betting on larger market moves. Both methods present more risks than other day trading strategies, such as scalping or range trading.

Pros and cons of buying stocks for day trading 

Research shows that the majority of day traders lose money in the long term. There are a variety of reasons for that, but much of the time it has to do with chasing gains. Often, they are getting in on a rising stock near its peak price.

Day trading can be a solid strategy in some circumstances, but only by experienced investors willing to trade without emotion and with those willing to do significant research. Some of the pros and cons of buying stocks for day trading:

Pros of Day Trading

• Potential for high returns: Successful day traders can generate substantial profits in a short period.
• Independence and flexibility: Day traders are their own bosses and can set their own hours.
• Intellectual stimulation: Day trading requires constant analysis and decision-making, which can be intellectually rewarding.
• Opportunity to learn: The market is constantly evolving, providing continuous learning opportunities.

Cons of Day Trading

• High risk of loss: Day trading is inherently risky, and losses can be substantial.
• Time-consuming: Successful day trading requires significant time and dedication.
• Stressful: Market volatility can lead to high levels of stress.
• High transaction costs: Frequent trading can result in significant transaction fees.
• Emotional toll: Dealing with constant market fluctuations can take toll on traders’ mental wellbeing.

Methodology: How we chose the best stocks for trading

Unlike traditional long-term investing, there are a lot of things you don’t need to worry about when considering the best stocks to day trade. The main thing you are looking for in day trading stocks is likely big movement swings that you can take advantage of and a large volume of trading. All of the above stocks fit that bill. However, whenever you are buying a stock, it makes sense to see which direction it is headed in and whether its valuation is justified by its movement.  

• High liquidity: Liquidity refers to how easily a stock can be bought or sold without affecting its price. High liquidity means there’s a large volume of shares traded, allowing you to enter and exit positions quickly without significant price slippage.
• Volatility: Volatility measures how much a stock’s price fluctuates. While high volatility can lead to larger potential profits, it also increases the risk of losses. Day traders typically prefer stocks with moderate to high volatility.
• Trading volume: High trading volume indicates strong interest in a stock. It’s generally easier to execute trades quickly and at better prices in stocks with high volume.
• Large market cap: Market capitalization refers to a company’s total market value. While there’s no strict rule, many day traders focus on mid-cap or large-cap stocks due to their generally higher liquidity and stability compared to small-cap stocks.
• Recent news and trends: News events and market trends can significantly impact stock prices. Staying informed about relevant news and identifying emerging trends can help you identify potential trading opportunities.

FAQs on stocks to day trade