Online day trading is about trading through the Internet on a day by day basis. All trades are started and completed within a single day, hence day trading. The trading can be about trading futures, option, Forex or stocks, for example. Online day trading, done properly, is fun. It is an enjoyable activity that is fun and can be extremely profitable too. For most people, this is all the reason they need to get into online day trading. Short term trading is not especially difficult to understand. It is quite easy to do, and it is not difficult to become successful doing it. Day trading used to be the reserve of very rich people. It used to be only bankers, professional speculators and investors who could afford to dabble in it. Then the Internet came along and changed everything. Now the occasional trader can work from home - online day trading has become very popular indeed. In the old days you had to have a broker. When you wished to make a trade, you would call your broker and ask for a quote on whatever you wanted to trade. Then you either accepted the quote, or you declined it and asked for another quote on something else. People still do it that way, but there's a certain feeling of blindness about trading like that. For most people, it's far better to have the full power of the Internet in online day trading where modern charting and analysis software can make it all a lot easier to get to terms with. For example, you can start day trading in the morning and see a stock that takes your fancy. You feel it will rise in price as the day goes on, so you buy it through a contract for difference (CFD). This means that if the stock is valued at say, $5.00, and two hours later your intuition was right and the price rises to $5.25, you profit from the difference. You may be thinking that getting a profit of 25 cents is not worth the effort, but we are talking about the price of a single share of stock. When you buy many thousands of shares, suddenly all the little individual 25 cents becomes very worthwhile doing. Online day traders tend to go for liquid stacks. These are stocks that have a lot of activity attached to them. There are plenty of buyers and plenty of sellers, all competing eagerly to try and make a profit. This is where the best opportunities can usually be found. Of course, you can lose money with online day trading too. You can download a free PDF ebook fromLive Charts that will help to explain the mindset you should adopt in day trading in order to succeed. The old adage of plan you trade, then trade your plan, works. You need a plan, preferably one that works. It needs to be a plan you are comfortable with, and one that you can have success with. Get practice in trading. You can sign up to a virtual trading platform such as How The Market Works and start day trading, safe in the knowledge that you will never lose a penny. Of course, you will never win a penny either, but the experience and the knowledge you will get from doing this is simply invaluable. |
Sunday, October 16, 2011
Online Day Trading
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