The day trader?s main objective would be to trade expensive and unpredictable stocks on the NASDAQ and NYSE markets in increments of 1000 shares or more, and profit from the small intra-day price movement.
The day trader may make a lot of trades in a single day, holding onto stocks for only a couple of minutes (or hours), and almost never overnight. Day traders are short-term cost speculators. They?re not investors, and they?re not gamblers.
Day trading isn?t investing. The day trader?s time period of analysis is rather short: one day. Their only intent is to exploit the stock?s intra-day price swings or daily price volatility. In contrast to stock investors, day traders don?t seek long-term value appreciation.
Stock volatility is generally a rule of the market as opposed to an exception. Most stock prices move up or down in any given day as a result of a range of external elements.
Even when the marketplace is somewhat calm, there are often stocks that are volatile. Day traders try to identify a stock that has a trend and then go with that trend. ?Trend is a friend? is a common motto amongst day traders.
Day traders try to pick up a relatively little stock movement, 1/8 or more on that stock. If day traders are trading a large block of shares (that?s, 1000 shares per trade), then day traders may profit $125 from a 1/8 price movement.
On the other hand, if a day trader received 1000 shares and the trader was incorrect, which also happens, then the day trader will lose $125 from a 1/8 price movement. Volatility is really a double-edged sword.
For highly-priced stocks that trade for $100 or more, a 1/8 or 13 cents movement is such a tiny relative price change that it happens all the time. Consequently there are plenty of day trading opportunities.
It?s not common to see a day trader executing many, sometimes as many as 100, trades in one day. However, an investor?s time frame is significantly longer. Investors seek a much wider price movement than 1/8 to earn the ideal rate of return. That takes time.
In brief, day traders seek to extract an earnings from intra-day cost volatility by trading the stock regularly, though the investors seek a long-term capital appreciation.
If you are in need of instant business capital and are interested in putting your capital into the stock market, success does not occur overnight.
It is best to do your research on a reverse merger to expand your small business. Get information and suggestions on reverse mergers from a financial specialist by searching: merger reverse.
Both comments and pings are currently closed.
au pair au pair trinidad trinidad jeff bezos chattanooga joey lawrence
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.