The main question most people ask when it come to day trading: is it necessary to sit at the computer ALL day long in order to become a succesful day trader?
The answer is NO. Generally , the rule of day trading is to trade when everyone else is trading, in other words, trade in the morning.
As with all financial investments, day trading is risky- in fact, it is one of the riskiest forms of trading out there. Day traders buy and sell shares rapidly in the hopes of gaining profits within the minutes and seconds they own those particular stocks.Simple to do in theory, harder to do in practice. The stock prices rise or fall according to the behaviour of the market, which is entirely unpredictable.
It is impossible to predict with certianty which stocks will result in profits and which in losses. Even the best of traders must learn to accept both outcomes. If you are constrained by a small amount of capital, you may not be able to buy large amounts of a stock, but buying only a small amount can add to the risk of a loss.
It is also important to know that in day trading, it is the number of shares rather than the value of shares that should be the focus. If you day trade, you will face loses, but even for the more expensive stocks,the loss should be marginal , because prices do not usally fluctuate to an extreme degree over the course of just one day.
The day trading industry deals in a large variety of stocks and shares. Here are just a few;
Growth Buying Shares – shares made from profit, which continue to grow in value, Eventually, these shares will begin to decline in price and an experienced trader can usally predict the future of this type of share.
Small Caps – shares of companies which are on the rise and show no signs of stopping. Although shares like these are generally cheap, they are quite risky for day traders. Safer to go with large or medium caps which are much secure thanks to a premium.
Unsolved Stocks – company stock that has not performed well in the past, traders buy these shares inthe hope of making profit if ad when the stock rises in value.
These examples are not the only options when it come to day trading stocks. The best way to determine which type of stock is best for you is to invest some time in careful research, vast knowledge of market patterns, a solid strategy and a disciplined trading plan.