What Is Day Trading? | Hantsbridge

Day trading is the act of buying and selling stock throughout the day in hopes that they will make a substantial gain for the day during the course of their trading. The reason this is possible is because the prices of stocks fluctuate wildly during the day just as they fluctuate from one day to the next. This leaves the market open to those who relish the opportunity to profit off the pennies that others will sell to save. It can be quite a lucrative practice but carries with it a level of risk that is almost equal to investing in penny stocks.

The rush that is received from day trading efforts is often compared to the same rush addicted gamblers get when walking into a casino. In fact, those who have gambling problems are strongly discouraged from participating in day trading activities for obvious reasons. Investing in the stock market carries some risk as a rule. The risks are magnified when you enter into risky practices such as day trading but the high profits that this type of trading can bring about is often incentive enough for adventurous investors to take the risk. In fact, many enterprising investors make lucrative livings from day trading alone.

There are many that carefully analyze the market and create elaborate formulas for their day trading efforts to varying degrees of success. Those who do succeed in this particular business are very secretive as to their formulas and aren't likely to share. The point is that this isn't completely a game of luck. There is some degree of skill involved in making the numbers work for you as well as the smile of Lady Luck upon your fortune that is required in order to win at the game known as day trading.

Most day traders prefer buying and selling on NASDAQ because it is generally more of a roller coaster ride, ideal for day trading, than the New York Stock Exchange (NYSE). The problem with this type of living is that you must constantly watch the market for those tell tale signs that a shift is preparing to happen. Lunch and sanity breaks can bring about destruction if you are counting on trading a specific stock at a specific price for the day (going up or down).

If you are the type of person that doesn't do well in stressful situation this is definitely not going to be the trading style best suited to your financial and sanity needs. This is a stressful gig often compared to the job of an air traffic controller. Though the lives of others aren't in your hands only your financial future. The truth is that much like the radar screens at busy airports though the market is constantly moving and in you take your eye off the prize for even a second you could miss the moment you've been waiting for and disaster may strike. It's a real rush for the adventurous sort and torture personified for those that are prone to nail biting and drinking antacids.

There are many 'safer' methods for investing your money that require a little more patience and produce a little less profit but are much easier for the nerves to handle. The Internet has made day trading a bigger way of life for more people today than ever before. The stress is shared by many people across the country though this is only one of many ways to invest big and earn big if you are so inclined. If you love taking risks though and have the time to dedicate to day trading this might be a great way for you to make the living you've always dreamed of making. This is a great job for those who love the highs and lows of a real roller coaster ride. Of course this is one job in which nerves of steal are a job requirement. Do you have what it takes?

Source: http://www.hantsbridge.org/2012/02/08/what-is-day-trading.html

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