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Day trading is the practice of buying and selling a security on the same day. Day traders close out all their positions at the end of the day. I would go a step further and say that day traders have the goal to make his or her profits from a security in the shortest amount of time but no longer than the same day. Simply put, day traders want to take a quick profit and then repeat the process - often. While day trading (speculation) has existed as long as there has been a market to accept trades, the practice has become popular and reached the mainstream as the advent of the Internet and the constant advances in computing technology have made it easier than ever to get real-time quotes and execute real-time stock trades. Technology has also made it possible to gather information about publicly-traded companies the stock market. Day trading is risky business. Day traders can see thousands of dollars evaporate within a few hours. Being a day trader is not for the fainthearted. It takes a little capital, a lot of nerve and the patience and determination to weather some storms that will surely materialize. Like any stock trading, day trading is learned the hard way. You will certainly make your share of mistakes and learn a lesson or two. The cost of this education will be losses. Because the stock market is dynamic, it is nearly impossible to master. When you start to get smug and think you have mastered the markets, that's the day you get your head handed to you (and a fistful of losses). Given the complexities of day trading, a day trading seminar or class is a good idea. If you are serious about being a day trader, it will pay off. Day trading seminars will teach you the particulars of day trading including day trading futures, stocks, market timing, trading systems, risk management, S&P day trading, trader psychology, etc. There are several online trading seminars and resources available to the novice day trader. Realistically, to get started in day trading, you will need enough capital to buy about 500 shares of stock. Obviously, the dollar amount will vary depending on the share price of the stock you intend to purchase. But if you go out to buy 500 shares of a $40 stock, you will need $20,000. If you know about diversification, you know you will have better returns if you could own this same amount of shares in four or five companies. Unless you have money to burn, preservation of capital is the foremost objective of day trading. Taking unnecessary risks to make a kill will ensure you have a short career as a day trader. You must keep in mind the risk reward ratio of every potential trade. That may mean foregoing an opportunity for profit to protect your capital. Additional day trading information can be found at:
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Day Trading
