Day Trading Stock Picks – Strategies For Success2 min read
Strategies for Success
When you’re first starting out as an investor, many people tell you that you should stick to industries that you know and make only long term trades that carry minimal amounts of risk. This is sound advice for the new investor, as they usually lack the self-control and education that are needed to navigate the market safely. Because there is risk involved with every stock market transaction, it’s important that new traders stick to slower paced trading until they become more comfortable in the market. Once you’ve built out your confidence and portfolio a little more, it might be time to try your hand at some day trading stock picks.
In case you’re unfamiliar with the world of day trading stock picks, it’s important to develop an understanding of what a day trader does, and how they’re activity is different from a trend trader or swing trader. Technically defined, day trading is the practice of buying and selling shares, options, or commodities with the intent of closing all positions by the end of the trading session. This means that a day trader will buy shares of a stock with the intention of selling them as fast as possible for making a profit. Although the day trader might buy dozens of different stocks throughout the course of the day, it is their goal to have sold them all by the end of the day, even if that means taking a loss.
In order to be a successful day trader, you not only have to know how to make day trading stock picks, which are different from the longer-term swing trades and trend trades, you also have to be familiar with day trading strategies which will prevent you from being caught with unsellable stocks at the end of the day. It’s important for all day traders to trade in the direction of the current trend, and many will buy as soon as they confirm the beginning of a trend, and sell as soon as they see that growth trend begin to falter.
Although it is far more risky than making trades based on chart activity, many investors will make day trading stock picks based entirely on insider information, up to the minute stock market news, and rumors. This takes a great deal of confidence, both in your sources and your ability to make trades on a split second’s notice. This is not recommended for new traders as it is very risky.