Volatility be damned—a '90s icon makes a risky comeback.

Remember day traders?

A decade ago, they were the folks quitting their jobs to buy and sell stocks full time. They were "momentum investors" who looked for opportunities by anticipating sharp ups and downs in the movement of share prices and riding those movements for a quick profit before getting out after a few hours, days, or weeks. They didn't believe in the orthodoxy of "buy and hold" or even necessarily in the significance of economic fundamentals. Numerous experts predicted they were heading for a big fall, and fall many did.

These days, almost nobody wants to be called a "day trader." Yet the sheer volatility of the current market upheaval, a period in which daily swings of 500 points in the Dow have become quite common, is contributing to a return of day-trading practices, according to several brokerages that cater to active investors.

"There are a lot of people out there who are saying this is a good time to get back into the market," says Mike Feser, president of Zecco, an online brokerage that reported an 89 percent increase in new customers in October compared with September. "Are a lot of these day traders? Absolutely."

Why is this happening? Common sense and recent history would suggest that booming markets attract opportunistic investors, and plummeting markets repel them. And indeed, many nonprofessional traders do seem to be withdrawing.

But Zecco—based in Pasadena, Calif., and known for its dirt-cheap commissions and investing forums that let participants see the actual investments in each other's portfolios—says that lately its customers have been buying and selling some of the most volatile of public companies, beaten-down financial firms like AIG, Fannie Mae, Freddie Mac, and Citigroup. "They know how to play both sides of the market, whether it's going up or down. They know how to buy stocks, options, puts, or calls," he added.