Facts of Day Trading

Are you thinking of entering the fast-paced world of day trading? Arm yourselves with the information from this fact sheet on day trading.

What is day trading?

Day trading is an investment tactic that does online daily stock trading with a relatively short investment. Those who do day trading usually buy and sell securities during the same market day and, as a general rule, do not hold stocks overnight. Many day traders make dozens of trades every market day hoping to capture profits that arise from small intraday price fluctuations.

How is day trading different from swing trading?

Day trading relatively holds the stock for only the day. After the stock market closes, a day trader has no stock in his hands. Swing trading holds a stock for at least a few days, waiting out for the best price before dumping it back to the market. Day trading is much more stressful and requires guts and a keen business sense. Once you get good at day trading, you can earn up to $50,000 from your initial investment.

How much capital would you need for day trading?

You need an investment equivalent to buy 1000 stocks. That is roughly around $20,000. Because the chances are small that you will find a marketable stock with a price of under $20, this is enough to get your day trading underway. However, you must remember that this is a 100% risk capital so do not worry too much if you lose this amount very early.

What are the general rules for day trading?

- Always trade with the trend.
- Cut losses short
- Never get emotionally involved in your trades.

What are the most suitable stocks to trade for day trading? It is advisable to trade high volume stocks. Go with the trend with the popular stocks available. It'll be easier for you to sell those stocks at the end of the day trading.

How does a usual day trading transaction occur?

For example, at 10:00 AM a day trader might buy 1000 shares of stock XYZ just as the price begins to rise on good news, then sell it at 10:04 AM when it's up by 1/2 ($0.50). The day trader makes $500, minus commission. With today's cheap commissions of $29.95 or less per trade, that's a quick $440.10 or better, excluding taxes.

Most people who deal with day trading spend all of their time in front of the computer, watching the slightest change in the stock price. As the prices go up and down, the day trader must be alert as to when to sell his stock or wait for the moment to hold on it. This can be a very stressful lifestyle as a mere second could mean an increase of half the stock price and missing that moment for any person engaging in day trading could mean a loss on his investment.

Day trading is not a get rich scheme. It is serious business where you could lose everything within minutes because of wrong information. Before jumping into day trading, remember to do your homework first. Go to seminars on day trading, use simulations if possible and practice reading market indicators. To be a successful day trader, don't just need luck. Knowledge and experience counts. Welcome to the world of stock markets and investments!

For More Information and articles about day trading check out the forex trading center.

---

Reality of Online Forex Trading

Foreign exchange trading is the trading of currencies. Most currencies... Read More

10 Steps To Professional Day Trading

Everyone trades a little differently. The trading method outlined below... Read More

What is Forex Trading?

Forex, or Foreign Exchange, is the simultaneous exchange of one... Read More

Stock Market Report: Day Trading or Swing Trading Online? Stock Investing Information

Profitable day traders recognize that momentum trading is among the... Read More

Dont Deny Reality

If you want to be a successful trader, you must... Read More

Exploring the World of Day Trading

Are you looking into a career in day trading? In... Read More

Intrenet Marketing VS Forex Currency Trading

Have you noticed that when someone's trying to sell you... Read More

Assessing the Opportunities Presented by the New Iraqi Currency

Could it be possible that you are staring right into... Read More

Business and the Forex

The business world is a complex web of supply and... Read More

Experience

Throughout our course on futures trading, we have tried to... Read More

How Currencies are Traded in the FOREX Market

Currencies are traded in dollar amounts called "lots". At 100:1... Read More

Facts of Day Trading

Are you thinking of entering the fast-paced world of day... Read More

The Basics of Forex

Foreign exchange market is also known as Forex or FX... Read More

Money Management, Part 2

FEARING LOSSESThere is a huge difference between being risk averse... Read More

How To Control Fear And Greed In Trading

There is an old saying that the market is driven... Read More

Commodity Trading - Advantages and Disadvantages

What Is Commodity Trading?Commodity futures markets allow commercial producers and... Read More

Forex Brokers - Helping to Maximize Your Success

A Forex broker is a broker dealing in foreign exchange,... Read More

Why Demo Account Performance Is Often Better Than Real Account Performance

Over the past several years, the popularity of online currency... Read More

Choosing A Forex Broker

With currency trading becoming ever more popular, the number of... Read More

ISO 4217 in Forex Trading

ISO 4217 is an international standard describing three letter codes... Read More

Forex Scams: How to Spot Them A Mile Away

In recent years, investors have witnessed increased number of investment... Read More

Forex Trading Systems

The foreign exchange currency market is the largest market in... Read More

Forex Trading

Foreign exchange market, or better known as FOREX, is the... Read More

Forex2u Forex Strategy On Successful Forex Trading

The essence of the FX2u Forex strategy is that it... Read More

A Fools Game

I received an email this week with a question (below)... Read More

Forex Broker Involvement Optional

To trade on the forex market, the largest financial market... Read More

Why Hedge Foreign Currency Risk?

International commerce has rapidly increased as the internet has provided... Read More

Forex Trading Online - 7 Reasons Why You Should!

Forex trading online is a fast way to use your... Read More

Online Futures Trading - Advantages and Disadvantages

What Is Online Futures Trading?A futures contract is an agreement... Read More

How to Trade Currency

We all know when you go on a trip to... Read More

Stopping Yourself

I read on a bulletin board a traders comment that... Read More

Factors Influencing a Currency Pair Exchange Rate

IntroductionThe exchange rate refers to the value of the US... Read More

Day Trading Course or Day Trading Technique Seminar: Learn Day Trading Education

Profitable day traders recognize that momentum trading is among the... Read More