Understanding day trading is a must when you are entering into day trading. A famous day trader, Guy Gentile, defines day trading in simple words that day trading is simply a process of buying and selling shares on daily basis. Whatever you purchase today you have to sell it today OR whatever you market today you have to buy it today.
As a successful day trader, his blog shares some points from his personal experience which will be helpful to steer in the stock market and leads on the way to success.
Advantages of Day Trading –
a) Margin trading – Day trading gives you margin on your account balance, which means you get more leverage (amount) on the amount of your account balance available to make daily trades. This concept is known as margin trading. Margin trading is only possible in day trading and not in delivery trading. How much extra amount (margin) you get depends on your broker or brokers in their online system.
b) The second important advantage is that you have to pay fewer brokerage fees in day trading compared to delivery trading. Again, these brokerage fees vary from broker to broker (or their online trading system).
c) In day trading you can sell and then buy, this is called short, which you cannot do in delivery trading. You can sell stocks when prices fall and then buy them when prices continue to fall.
How to become a successful day trader?
By following some simple steps, you may become a successful day trader.
Online day trading requires a few things in order to be successful. A good, reliable trading computer with 1024 MB of RAM is essential. Depending on your opinion and the opinions of the experts, two or three monitors or a single large monitor will be effective to proceed. with trade. Successful online day trading requires a high-speed internet connection that allows for a rapid flow of real-time charts and quotes. An unlimited power supply, shortcut software, and a good broker are also available important aspects that keep online day trading running and successful, as instant information and quick order placement are guaranteed.
The broker’s execution of orders must be instantaneous, with low spreads and small margins. It is important to ensure that all online transactions are secure, encrypted, and password protected.
Another important tip for successful day trading is never to trade stocks with emotions. Emotions are meaningless in trading as they can result in you losing money. Always trade with the right planning and trading strategies. If you are a beginner in day trading, it will be great for you to take proper trading education provided by many online trading institutes.
Always choose the right online brokerage firm for day trading with caution. Do not blindly trust all trading brokers and only trust a reputable broker who can make the most of your hard-earned money as there might be a few rogue brokers online as well.
What are the common day trading mistakes and how to avoid them to make a generous profit?
1) Wait and get paper confirmation of trend change, then plan and place your trades (buy/sell). Do not jump or trade before a trading exchange confirmation, this can damage your capital (bank balance).
2) Don’t wait long for the trade: Suppose you made a trade (buy or sell) but the coupon is not moving up or down, it’s just stable or moving with a very small price difference, then you should exit this trade and look for other coupons.
3) Don’t change your trend on volume volatility: Don’t panic here and sell your shares, wait and understand the situation correctly, and then act. This situation is common, but if you’re sure your stock will go up, stick with it.
Hope so this information is helpful to enter into trade marketing. If you need more information, here are some more blogs. Links are mentioned. You can learn more by clicking these links:
Guy Gentile 