What is Day Trading in Stocks?
Day trading is a popular stock trading strategy in which traders open and close trades on the same day with the intention of profiting from small price movements.
It is important to note that day trading is classified as a short-term strategy and the traders don’t hold their positions overnight.
How Does Day Trading Work?
Day traders pick a stock at the beginning of the day, then sell them within the same day with the goal of making a profit from price movements that happened within that day. When the market closes for the day, a day trader will have closed all their positions and realised their profits or losses.
And before you even ask, yes, it is risky.
Day trading is suited for stock traders that have enough time throughout the day to analyse, execute and monitor their trade.
You might be a Stock day trader if:
- You like to enter and exit a trade within one day.
- You don’t like worrying about what is happening with your trades .
- You have time to analyse the markets at the beginning of the day and can monitor it throughout.
- You like to know where you’re at with your trades at the end of each day.
You might not be a Stock day trader if:
- You don’t have enough time to analyse the markets and monitor them throughout the day.
- You like longer or shorter term trading.
- You have a day job.