Does anyone understand day trading?

Question

If anybody has ever read any of my posts on real estate, I consider myself a fairly savvy real estate investor. However, I have heard about and want to learn about day trading in stocks. I have an idea on what it is but has anyone done it here and done well? (Or at least not lose their shirts?) Also, if you have done well, what did you do or what skills did you learn in order to be successful? Thanks in advance.

PS. Is this also a good way to make money or is it a waste of time and money?

Listen Max H, you shouldn't talk to your father like that or I might stop my child support payments. Tell your mom to have my kidney pies ready when I go see her or I might have to keep my pimp hand strong.... ya dig?

Answer 1

Day trading, basically, is profiting from small differences (and sometimes big ones) in the prices of stocks etc. on one day (sometimes 2 or 3 days). It requires experience, a lot of knowledge and constant up-keeping your information. It's taking constant working if you want to do it right, not only a couple of hours per day. It's not for the faint hearted and not suitable as a fast money maker. It can be profitable though, as I know having a staff of good people now that make my trading lighter (so that I don't have to do everything myself anymore). It took me over 20 years to get to the level I'm now. If you really want to do it, start small and/or with a practice account, read a lot of papers (not only one), follow and take in all the news you can find and read some materials and books about the different parts of trading (e.g. technical analysis, trading-systems, product-info etc.).
I wish you good luck. Don't hesitate to contact me if you have any questions.

Answer 2

Stock trading is one of those businesses that are not right for everyone. It takes a special kind of personality to do well in the stock trading game. Not everyone is fit for a high stress environment where things can change in a New York minute. If you are thinking about trading stocks there a few things you should consider before you dive in head first.

Here are the pros of why you should invest in the stock market

• Return On Investment - The highest returns come from investing in a stock that is in its beginning stages. You have to find a stock that is most likely to gain investors. Think about it like this, if you would have invested in Google, in its earliest stages of growth, you would have been a millionaire by now. Find a product or company that seems like they will do will and invest in it as early as possible.

• Constantly Changing - If you are someone who hates repetition, loves frequently changing activities, and loves to gamble, stock trading might be for you. It's a business that is changing every day and for anyone that thinks they have got it mastered needs a reality check. Just when you think you've spotted the trend, it could shift the very next day and give you a run for your money.

• Work From Home - The great think about the stock market today is that everything can be done online or with software and a strong internet connection. The great thing about online is that it can be accessed from anywhere. Not only can you work from home but you can also work from anywhere that has a strong internet connection.

Here are the cons of why you shouldn't invest in the stock market

• High Starting Costs - Trading in the stock market has it benefits but start-up costs are not one of them. To get into trading and actually stand a chance at making money is tough if you don't already have a high bank roll to start with. Some trading firms on the lower end want you to start with at least $2,000 dollars, most want you to be able to at least start with $15,000 dollars to be able to see a return on your investment.

• Trend Spotting - It takes a certain amount of intuitive nature to be able to gauge whether a stock is going to rise or fall. Some of the best traders in the world are still perfecting trend spotting methods. There are software applications that use algorithms to spot trends but software doesn't have the unique intuition that a 30 year stock trader might have, it can only gauge rises and falls by what has happened in the past and then applying it to today. Even if you are a naturally intuitive person, this can still be a difficult task for you.

• Competition - This is a very saturated market where investors with limitless bank rolls, buy and trade stocks like they are pieces of candy. Sometimes one buying or selling of a stock from someone, that own a large amount of shares in a company can raise or drop the points of that stock tremendously. If you happen to purchase stock in a company and then someone from that same company sells all of their shares, your share prices per stock drops.

Stock trading is one of the hardest crafts to learn. Spotting trends and knowing what the competition is doing is almost impossible unless you have plenty of resources and inside connections to the industry.

Answer 3

With day trading you need to do research reading the Financial Times. Need to find sectors of the stock market i.e Utilities, IT, Retail, and find out the sectors/markets that are performing well over a given period. If you are buying a stock for 1 day only and the price doesnt move up to give you a profit to cover your dealing charges, likely outcome is that you are stuck with the stock, or at worst making a slight loss. Problem now that the FTSE 100 is now at a quite high level of over 6000 points the level of increase in the market confidence is only going to make day trading more risky. I used to buy shares in the companies stocks that had good fundamentals i.e good business product, and sales and profit reporting history. I would only buy the stocks were the shares had fallen on a number of consecutive days in hope of a return higher. This strategy in the long term resulted in 25% profit a year, though i didnt buy and sell on the same day. The chances of even a experienced trader in making high profit in 1 day is quite low

Answer 4

I think day trading has been glamourized by brokerages as a way to increase their commissions. Studies have shown that frequent trading offers no benefits over holding for longer periods. I think the best way to invest is to study a company. Find one that meets a set of criteria. then stick with it for a few months. And then re-evaluate it, and either sell or hold or buy more.

I think the best way to find investment ideas is to see what the best investors are buying and selling. You can find this information at http://www.top10traders.com - this is a free site that lets you create a portfolio of stocks with $100,000 in "play" money. Each day the site ranks the best performing portfolios, so you can see how your picks perform compared to other investors. You can also read posts on investing from the best traders, as well as share your own investing ideas. There is also a charting feature , so you can see how your portfolio performs compared to the S&P 500.

Here are this month's best traders:

http://www.top10traders.com/Top10Standings.aspx

Good luck.

Answer 5

Penny stocks are loosely categorized companies with share prices of below $5 and with market caps of under $200 million. They are sometimes referred to as "the slot machines of the equity market" because of the money involved. There may be a good place for penny stocks in the portfolio of an experienced, advanced investor, however, if you follow this guide you will learn the most efficient strategies https://tr.im/fb19f

Answer 6

Hi,

Day trading is very profitable but i also could be risky. But I like day trading in forex. Already several years I'm trading sucessfully.

Before beginning you should read and study following books:
Market Wizards by Jack D. Schwager;
Technical Analysis by Jack D. Schwager;

Comprehensive Course on The Wave Principle by A.J. Frost and Robert Prechter;

Candlestick Charting Explained- Timeless Techniques for Trading Stocks and Futures by Gregory L. Morris;

Trading Chaos – Applying Expert Techniques to Maximize Your Profit by Bill M. Williams;
New Trading Dimensions by Bill M. Williams
Trading Chaos II by Bill Williams – Maximize Profits with Proven Technical Techniques by Justin Gregory-Williams and Bill M. Williams

Then I suggest you to visit website www.profitunity.com and order home study course. If you would have possibility then also try to get education in his office. You’ll see how easy you could become successful trader and how easy is trading using his guidance and software.

If you do everything in range as I wrote I believe that you become successful trader.

I could introduce you to one brokerage company in Austria that allows to trade from same account currency (forex), commodities, metals and cfd on shares. Total 500 instruments available; spread from 1 pip. If you open trading account under my referral I provide you for free with trading techniques that I successfully use for several years.

If you have any question please do not hesitate and pm or e-mail me.

Good luck!

P.S. Actually I think that every trader should be day trader, swing trader and scalper accordingly to the market movement

Answer 7

Many already provided useful tips about daytrading so I am going to add some additional information to compliment their answers.

1. It is not necessary for you to go with daytrading stocks. There are many alternative trading vehicles out there. Some people find that they are going with trading stocks. Some people find that they prefer trading commodities. Some people like me trade index futures and forex. Do not limit yourself to a single idea. Do some research to see which market fits you best.

2. Instead of focusing on the performance of other people, focus on defining your goal. Why you want to daytrade at all? Could there be alternative to day trading that actually fits you better? Daytrading is not everyone's cup of tea and it takes a lot of effort to make it work for you.

3. Daytrading stocks, futures, commodities, etc. are all possible way to make money. Unluckily majority of the aspiring traders fail to complete their education in the game because of capital depletion. i.e. losing their initial stake.

I have posted several articles about income potential in my blog:

Index future trading
http://www.daytradingbias.com/?p=84733

Forex trading
http://www.daytradingbias.com/?p=85532

4. Main difference between real estate investment and daytrading is that daytrading is scalable within a day. Once you've develop a good trading plan that you can stick to, it is a matter of time and patience to build up your trading capacity.

Good luck!

Answer 8

Day trading is for investors with long experience, good conacts and large capital, who can negotiate low brokerage charges. They make their profit on very small margins and in your case lack of inside information and high brokerage charges (about 1%) will kill you.

Answer 9

Hi, i suggest a great site with plenty of Issues related to your Investing and everything around it. it also provide clear and accurate answer to many common questions.

http://investing.sitesled.com/

I am sure that you can get your answers in this website.

Good Luck and Best Wishes!

Answer 10

I give you Monday you give me Wednesday.
(sorry, I just had to. I'm in a very giddie mood right now)