Is Day Stock Trading For You?

#1
Is Day Stock Trading For You?

Do you have the tolerance for the risk involved with day trading? Day trading is not a get rich quick business. It is not technically even investing. This competitive game of day trading is speculation at its core and the odds are against you in favor of failure. But for those who crave this type of environment it can be a very exciting and profitable venture. A study in 1999 found that 70% of day traders lost money and of those that made money the profits were made from just one trade.

Stock Day trading involves taking advantage of price movements in stocks within one trading day. Day traders typically hold stocks anywhere from only a few seconds to several hours but they never keep stocks overnight.

It is vital that day traders have access to real time market quotes and activity because fluctuations in price can make or break a day trader if an order is delayed only seconds. In addition to real time quotes (stock quotes and ticker), day trading requires a high speed computer connection and a reliable online order execution service. There are a variety of online trading services. One problem with internet discount brokers is there can be a delay in the length of time it takes them to execute a trade order. The preference of day traders is an Electronic Direct Access Trading service which links the trader directly to the exchange through a modem. This can result in a much faster order.

Tips for beginners of day stock trading


1) Study the profession in depth before getting started.

2) Practice using a simulated trading system before using real money.

3) Dont trade with money that you can not afford to lose.

4) Decide each day how much you are willing to risk and stick to it.

5) Keep detailed records of your trading results to analyze your track records.

Day stock trading is not something to jump into without considerable thought. Take the time to learn the business, practice without using real money in a stimulated scenario, study as much as you can about it before you begin and most importantly do not risk money you can not afford to lose. Have fun!
 
#2
Tks TAtrader,

The write-up was good, Being a fresh trader, I am still in the planning stages to take up day-trading.

Looking for more info on the same topic....and is there any particular book or website where I can a learn a bit more of the same topic?

-Sam.
 
#3
I think TATrader is very correct in saying that day trading is speculation at its core. I have myself had my set of expriences in day trading about which again TATrader has hit the nail on the head. Most of the day trades I came across were based on some "hot" news or "hot" tip. Profitable day trade are only one or two which make up for the losses incurred in all the other day trades. But if one wants to make money in day trades consistently then I feel (others pls comment) the trader has to have a deep understanding of interpreting the market sentiments. Personally I feel there is little less analysis in day trade and most money is made by chances one takes. The amount of money swing is too good in day trade if you get it right.
 

jamit_05

Well-Known Member
#4
True day trading is not technically interesting at all.
In my opinion it is the arena for risk management... PERIOD
You might wanna go ahead and bust your a** for the coming few months trying all technicals you want. You will discover that none really works.

I am working really hard on getting a good money management strategy, i hope i can collaborate with someone and discuss the my ideas. I believe in team work..... do you?
 

jamit_05

Well-Known Member
#5
james said:
I think TATrader is very correct in saying that day trading is speculation at its core. I have myself had my set of expriences in day trading about which again TATrader has hit the nail on the head. Most of the day trades I came across were based on some "hot" news or "hot" tip. Profitable day trade are only one or two which make up for the losses incurred in all the other day trades. But if one wants to make money in day trades consistently then I feel (others pls comment) the trader has to have a deep understanding of interpreting the market sentiments. Personally I feel there is little less analysis in day trade and most money is made by chances one takes. The amount of money swing is too good in day trade if you get it right.
Sentiments? You mean the momentum.. right! Well, that can be found by technicals. However, you might think you have your finger on the momentum , just wait for another 10 min, the technicals will soon tell you otherwise. I mean, you cannot really bet on it James. NO TECHNICALS ZONE, thats what day trading is. Nothing really works CONSISTENTLY. That is the key word. Whatever system you have must work, atleast 70% of the times. Such a competetive environment has encouraged a certain league of traders found in no other business, they are more popularly called as scalpers.
Due to such uncertain nature of the trade we have scalpers.
 
#6
I wonder how Day Traders did today... seriously, curious to know how many went short and chose to cover.. kudos to them

One view is the market fell due to pressure on Nifty FNO segment arising from the Reliance demerger technicalities.... if that is true, the rally will be equally sharp ( may not happen tomorrow, but sooner or later... remember the sustained rally after the Oct slump, just a few mths back ?)

Any views?
 
#7
Well here's the rally for you ... almost equally sharp... as I write, its 133 ponts up

Shorts , dont tell me I didnt warn you ( see previous post)
 

vince

Active Member
#8
Agilent said:
I wonder how Day Traders did today... seriously, curious to know how many went short and chose to cover.. kudos to them

One view is the market fell due to pressure on Nifty FNO segment arising from the Reliance demerger technicalities.... if that is true, the rally will be equally sharp ( may not happen tomorrow, but sooner or later... remember the sustained rally after the Oct slump, just a few mths back ?)

Any views?
Hi agilent,

One of the basic rules of intra day trading is whether win , loose, or draw, to never ever carry forward a trade to the next day. Hence covering shorts would be the logical and disciplined decision.
regds.
 
#9
vince said:
Hi agilent,

One of the basic rules of intra day trading is whether win , loose, or draw, to never ever carry forward a trade to the next day. Hence covering shorts would be the logical and disciplined decision.
regds.
Oh of course... how did I miss that one... sorry for the faux paus

What I meant was obviously for shorts other than day traders. Never mind
 

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