Jun
30
Car Enthusiast
What are good stocks to buy in the short term?
What are good stocks to buy in the short term?
My econ class is playing a stock game but using the real stock markets. I have $100,000 to spend. I am hoping to find some stocks that are going up in the short term because school ends in two months.
Any good suggestions?
Jun
30
Why Day Trade Futures and not Stocks?
Filed Under Choosing To Trade Forex Or Futures | Leave a Comment
David S Adams
I began my trading career day trading stocks, mostly the blue chip variety. And there is nothing wrong with day trading stocks, though generally speaking individual stocks do not have the volatility that many day traders crave. To be sure, stock trading is a longer term proposition and are less prone to to dramatic movement. For my money, I generally buy stocks to either swing trade, or hold onto for longer term growth. On the other hand, you can often find individual stocks that oscillate widely on a daily basis and are perfect for day trading, but these instances are rare. I can recall years ago that Jupiter Systems was a great day trading stock, as I haven’t traded it in years, I do not know the current status of this issue.
On the other hand, the financial requirement for trading index futures contracts lends itself favorably to the day trader. The key element is margin, in this case. When trading stocks, Regulation T becomes a prime issue, and Regulation T requires you to put up 50% of the contract value in order to trade the stock. If you are trading GOOGLE in round lots, say a hundred shares, (google is trading in the low 500‘s) you will be forced to pony up a significant amount of cash in order to trade this stock.
Futures contracts are another matter all together. Most futures contracts, specifically the emini variety, were specifically designed for day traders. You can usually find brokerages that offer margin requirements in the range of $500 per contract. Each point on, lets use the ES emini contract, is worth $50 dollars, and lets assume the ES index is trading in the 1000 dollar range. Simple math tells us that you are controlling nearly $50,000 dollars with a paltry 500 margin requirement. In trading, leverage is kind, when used properly.
Once simple consideration should always be forefront in your mind, though. Leverage will maximize you returns and maximize you losses. A skillful trader will manage his money effectively, never overextending himself/herself in a given trade. In my trading, I never like to risk more than 10% of my futures account value on a given trade. Some traders even lower this amount to no more than 5% on given trade. This is, of course, a personal preference but the point is a simple one; because of the high degree of leverage in futures contracts, money management is of utmost importance.
For example: Lets say you have established a $5000 futures trading account. Generally speaking your futures broker will let you trade up to 5 contracts on this account. It should be noted that most futures brokerages will not let you trade up to your account limit, and most set trading restriction at about 50% of your account value. Anyway, there is no way that you should even consider trading your maximum level (5 contracts) on a given trade. On a $5000 account I would be hesitant to trade more than I contract, maybe 2 if I felt very comfortable with the trade. Overextending your trading account is a great way to end up broke. Be judicious in the number of contracts you trade, and always use stops to make sure you don’t get caught in a run away trade in the wrong direction.
Leverage in futures contracts can be a very useful tool to increase your account balance, and your potential to make money is far greater in a futures account than day trading a stock account. But managing a futures account takes a high degree of skill and self discipline. There is a constant compulsion to overtrade your account, or trade an excessive number of contracts relative to your account size that has to managed with skill. Further, it is your responsibility to exercise proper money management when trading futures contracts.
In summary, we have taken a close look at day trading stocks and futures contracts. Stocks can be suitable investment vehicles to day trade, but because of the leverage requirements in futures contracts they are generally a better choice, but only if you are able to responsibly implement money management techniques that don’t expose you to excessive risk. Money management is one of the most challenging aspects of trading, and one of the most difficult to master. I suggested never risking more than 10% of your account on a given trade.
I began my trading career day trading stocks, mostly the blue chip variety. And there is nothing wrong with day trading stocks, though generally speaking individual stocks do not have the volatility that many day traders crave. To be sure, stock trading is a longer term proposition and are less prone to to dramatic movement. For my money, I generally buy stocks to either swing trade, or hold onto for longer term growth. On the other hand, you can often find individual stocks that oscillate widely on a daily basis and are perfect for day trading, but these instances are rare. I can recall years ago that Jupiter Systems was a great day trading stock, as I haven’t traded it in years, I do not know the current status of this issue.
On the other hand, the financial requirement for trading index futures contracts lends itself favorably to the day trader. The key element is margin, in this case. When trading stocks, Regulation T becomes a prime issue, and Regulation T requires you to put up 50% of the contract value in order to trade the stock. If you are trading GOOGLE in round lots, say a hundred shares, (google is trading in the low 500‘s) you will be forced to pony up a significant amount of cash in order to trade this stock.
Futures contracts are another matter all together. Most futures contracts, specifically the emini variety, were specifically designed for day traders. You can usually find brokerages that offer margin requirements in the range of $500 per contract. Each point on, lets use the ES emini contract, is worth $50 dollars, and lets assume the ES index is trading in the 1000 dollar range. Simple math tells us that you are controlling nearly $50,000 dollars with a paltry 500 margin requirement. In trading, leverage is kind, when used properly.
Once simple consideration should always be forefront in your mind, though. Leverage will maximize you returns and maximize you losses. A skillful trader will manage his money effectively, never overextending himself/herself in a given trade. In my trading, I never like to risk more than 10% of my futures account value on a given trade. Some traders even lower this amount to no more than 5% on given trade. This is, of course, a personal preference but the point is a simple one; because of the high degree of leverage in futures contracts, money management is of utmost importance.
For example: Lets say you have established a $5000 futures trading account. Generally speaking your futures broker will let you trade up to 5 contracts on this account. It should be noted that most futures brokerages will not let you trade up to your account limit, and most set trading restriction at about 50% of your account value. Anyway, there is no way that you should even consider trading your maximum level (5 contracts) on a given trade. On a $5000 account I would be hesitant to trade more than I contract, maybe 2 if I felt very comfortable with the trade. Overextending your trading account is a great way to end up broke. Be judicious in the number of contracts you trade, and always use stops to make sure you don’t get caught in a run away trade in the wrong direction.
Leverage in futures contracts can be a very useful tool to increase your account balance, and your potential to make money is far greater in a futures account than day trading a stock account. But managing a futures account takes a high degree of skill and self discipline. There is a constant compulsion to overtrade your account, or trade an excessive number of contracts relative to your account size that has to managed with skill. Further, it is your responsibility to exercise proper money management when trading futures contracts.
In summary, we have taken a close look at day trading stocks and futures contracts. Stocks can be suitable investment vehicles to day trade, but because of the leverage requirements in futures contracts they are generally a better choice, but only if you are able to responsibly implement money management techniques that don’t expose you to excessive risk. Money management is one of the most challenging aspects of trading, and one of the most difficult to master. I suggested never risking more than 10% of your account on a given trade.
Jun
28
JimBo
I purchased 200 stocks in a company back in 1997 through H.J. Meyers & Co. Inc. From looking online they appear to have closed their doors amongst some scandal some time ago. The company I bought stock in is still operating (PMTI). How do I claim my stock certificates and succesfully sell my stock in this company ?
I purchased 200 stocks in a company back in 1997 through H.J. Meyers & Co. Inc. From looking online they appear to have closed their doors amongst some scandal some time ago. The company I bought stock in is still operating (PMTI). How do I claim my stock certificates and succesfully sell my stock in this company ?
Jun
26
How To Day Trade Without Emotion
Filed Under Playboy Enterprises, Inc. (NYSE: PLA) Is The Buyout Priced In? | Leave a Comment
Day Trader Team
If you are a day trader we know you have been there…..
Wishing, Hoping and Praying that the trade you are in works to your benefit. More often than not, traders do not have their best interests in mind. If you are to be successful when trading you must act on what is in your best interest. It is the most important concept you can learn in order to be a successful trader. If you can master this skill, you can be very successful in this business. But without it, you are destined to fail. It really is that simple. If you can learn to act in your own best interest, you will make a lot of money trading. If you do not learn to act in your own best interest, you will lose a lot of money trading.
You see, the (futures) markets work in a very different way than almost everything else in life. There is more freedom in this business than probably any other business in the world. You can do what you want, when you want, pretty much any time the market is open. The only thing that will hold you back is running out of money. Other than that, you have all the freedom in the world to do whatever you want in the market.
Trading really is different from everything else we do in life. In the everyday environment, you can have control (at least somewhat) by taking actions that affect the environment. For example, if you wanted to listen to some music, you would have to turn on the radio. If you push the power button on the radio, music will come out of the radio. If you don’t push the power button, the radio will not turn on.
Another example would be if you wanted to start your car. If you put the key in the ignition and turn it, the car will most likely start because you did something to affect that change.If you don’t turn the key, the car will not start. You must change the environment (by turning the key) to get the car to start.
Everyday we all do things to affect changes on the environment. We put our bankcard in
the money machine to get cash out. We push the button on the coffee maker to make coffee come out in the morning. These are all changes that we can consciously make happen. But here’s the difference:
In trading, you can’t control what the market will do. No matter how much you want the market to go in a certain direction, there is nothing you can do to make it go in that direction.
There is no affect that you can cause on the market to make it do what you want it to do. We can’t push a button, we can’t turn a key, nothing we do will make the market do what we want it to. Nothing at all!
So, if we can’t control the market and what it will do, then the only thing that will make
us successful is if we can control ourselves. And that’s easier said than done. But it is the reality of successful trading. Again, you can’t control what the market will do, so you must control what you will do.
At Emini Futures Day Trader we take the emotion out of the trade. We keep it simple. After the market close each day, the system collects the newest market data which is then reviewed by our system analyst. A new signal for the next trading day will then be issued based on our analysts’ work and sent to each member via email that evening. Because recommendations are not given intraday and because subscribers have almost 12 hours to enter a new order in their brokerage account, our futures trading service is suitable for customers in any time zone working a full time job. You do not have to worry about constantly buying or selling.
With our futures trading strategies, you typically only have to enter a limited number of trades each month. You do not need to update entry and exit orders during the day nor do you have to follow the stock market or futures market each day. The rules are simple: we watch the market, we do the math, we signal you telling you what to do and when to do it. You take action and … make money.
Click Here to sign up for a free 2-week trial NOW.
Emini Futures Day Trader Team
If you are a day trader we know you have been there…..
Wishing, Hoping and Praying that the trade you are in works to your benefit. More often than not, traders do not have their best interests in mind. If you are to be successful when trading you must act on what is in your best interest. It is the most important concept you can learn in order to be a successful trader. If you can master this skill, you can be very successful in this business. But without it, you are destined to fail. It really is that simple. If you can learn to act in your own best interest, you will make a lot of money trading. If you do not learn to act in your own best interest, you will lose a lot of money trading.
You see, the (futures) markets work in a very different way than almost everything else in life. There is more freedom in this business than probably any other business in the world. You can do what you want, when you want, pretty much any time the market is open. The only thing that will hold you back is running out of money. Other than that, you have all the freedom in the world to do whatever you want in the market.
Trading really is different from everything else we do in life. In the everyday environment, you can have control (at least somewhat) by taking actions that affect the environment. For example, if you wanted to listen to some music, you would have to turn on the radio. If you push the power button on the radio, music will come out of the radio. If you don’t push the power button, the radio will not turn on.
Another example would be if you wanted to start your car. If you put the key in the ignition and turn it, the car will most likely start because you did something to affect that change.If you don’t turn the key, the car will not start. You must change the environment (by turning the key) to get the car to start.
Everyday we all do things to affect changes on the environment. We put our bankcard in
the money machine to get cash out. We push the button on the coffee maker to make coffee come out in the morning. These are all changes that we can consciously make happen. But here’s the difference:
In trading, you can’t control what the market will do. No matter how much you want the market to go in a certain direction, there is nothing you can do to make it go in that direction.
There is no affect that you can cause on the market to make it do what you want it to do. We can’t push a button, we can’t turn a key, nothing we do will make the market do what we want it to. Nothing at all!
So, if we can’t control the market and what it will do, then the only thing that will make
us successful is if we can control ourselves. And that’s easier said than done. But it is the reality of successful trading. Again, you can’t control what the market will do, so you must control what you will do.
At Emini Futures Day Trader we take the emotion out of the trade. We keep it simple. After the market close each day, the system collects the newest market data which is then reviewed by our system analyst. A new signal for the next trading day will then be issued based on our analysts’ work and sent to each member via email that evening. Because recommendations are not given intraday and because subscribers have almost 12 hours to enter a new order in their brokerage account, our futures trading service is suitable for customers in any time zone working a full time job. You do not have to worry about constantly buying or selling.
With our futures trading strategies, you typically only have to enter a limited number of trades each month. You do not need to update entry and exit orders during the day nor do you have to follow the stock market or futures market each day. The rules are simple: we watch the market, we do the math, we signal you telling you what to do and when to do it. You take action and … make money.
Click Here to sign up for a free 2-week trial NOW.
Emini Futures Day Trader Team
Jun
18
Day Trading for Dummies > Online Stock Investing Guide for Beginners – How to Pick Stocks ?
Filed Under A Quick Stock Market Tutorial 15 Tips For Beginners | Leave a Comment
Day Trade Online
BY.- http://www.ChatHotStocks.com
It’s no secret that online trading can be a very lucrative, yet highly competitive field, and the truth is that the stock market doesn’t care if you are an experienced or a beginner trader.
The rules and the opportunities are the same for everyone, so either you are going to make money when you pick a stock and make a trade or you are simply going to lose it in favor of the more seasoned ones.
As a stock trader your homework is all about studying and testing different market strategies that can help you take advantage of stocks while at the same time protect your gains.
Just always keep in mind that a good strategy is simple and practical. Complicated stock systems will always make you slow in your decision making process or confuse you from the start.
A trader must always read as much as he can. There is simply no other way to prepare one self for this difficult yet incredibly rewarding activity, but to read and put into practice as much ideas as you can, at least by paper trading first.
The are a lot of books on the subject that pretend to help you, however many of them where written 6 or 8 years ago and that kind of makes them obsolete in this constantly changing field.
Fortunately there are some practical stock trading sites on the web where you can access proven trading strategies that are easy to implement. One of those sites is http://www.ChatHotStocks.com
They focus on stock trading methodologies that can help you identify and take advantage of certain stocks with momentum, while limiting your risk.
Visit them today and improve your stock trading potential in 2009.
BY.- http://www.ChatHotStocks.com
It’s no secret that online trading can be a very lucrative, yet highly competitive field, and the truth is that the stock market doesn’t care if you are an experienced or a beginner trader.
The rules and the opportunities are the same for everyone, so either you are going to make money when you pick a stock and make a trade or you are simply going to lose it in favor of the more seasoned ones.
As a stock trader your homework is all about studying and testing different market strategies that can help you take advantage of stocks while at the same time protect your gains.
Just always keep in mind that a good strategy is simple and practical. Complicated stock systems will always make you slow in your decision making process or confuse you from the start.
A trader must always read as much as he can. There is simply no other way to prepare one self for this difficult yet incredibly rewarding activity, but to read and put into practice as much ideas as you can, at least by paper trading first.
The are a lot of books on the subject that pretend to help you, however many of them where written 6 or 8 years ago and that kind of makes them obsolete in this constantly changing field.
Fortunately there are some practical stock trading sites on the web where you can access proven trading strategies that are easy to implement. One of those sites is http://www.ChatHotStocks.com
They focus on stock trading methodologies that can help you identify and take advantage of certain stocks with momentum, while limiting your risk.
Visit them today and improve your stock trading potential in 2009.
Jun
16
Significantly Improve Your Day Trading Witht These 3 Secrets
Filed Under Rollover Days: Essential Information For Any Trader | Leave a Comment
Joseph James
TRADING YOUR WAY TO CONSISTENT PROFITS WITH A DAILY ROUTINE
Having a daily routine is crucial to any successful trader, whether they trade futures, stocks, options or the forex market. The daily routine used at the School of Trade has helps hundreds of traders use a simple and concise 3-step plan, in turn leading to more consistent profits. No matter how busy your day is outside of trading, sticking to a plan is the first step to becoming a professional trader. This is done by performing the daily routine, day in and day out, CONSISTENTLY. Below are 3 EASY steps to follow for a better daily trading routine:
Step 1: IDENTIFY
When you begin your trading day, it’s crucial that you try your best to identify specific roadblocks that might come up throughout the trading day. It can be easy to get quickly overwhelmed by all the information available for traders, but for starters you might want to consider just focusing on important market changing events. Specifically News Events that are related to the market(s) you trade. Find out the exact time during the day so you can be prepared for increased volume in the markets.
Another idea to consider is watching the Pre-Market and/or reviewing what has occurred to price since the open of the market (We will go over the benefits of 24-hour charts VS daily charts in an upcoming article). When you do this it makes it very easy to: Identify what type of market it is today; trending (higher highs, lower lows) or sideways (double-tops and bottoms etc.). This can help tremendously when you’re choosing which type of set-ups you’re going to use throughout the trading day.
Step 2: ADJUST
Trading is all about being prepared for what might occur in the future, and adjusting accordingly. Of course no one can predict the future, but you can help your probability of success by knowing specific times throughout the day not to trade….. (News events, meetings etc.). What I’ve found helps me the most is to set an alarm clock, that way you know ahead of time when to sit on the sideline of the markets.
Also, marking key Support & Resistance levels, whether it be from the pre-market or past trading days, is crucial to your consistency as a trader. The reason it is so important is because price will tend to gravitate to specific levels of support or resistance from prior trading days. There are many ways to identify areas of support and resistance, from trend lines to slower timeframes, which will enable you to adjust your trading according to how the market moves around these important levels.
Step 3: EXECUTE THE TRADE!
Once you have identified the ideal trading opportunities and made the proper adjustments to your trading routine, it’s time to execute the trade. To do this, Patience & Discipline are of utmost importance. Having patience and discipline, especially when you’re waiting for your perfect trade set-ups, will intern help you become a consistent trader. This is accomplished by let your Rules trade for you, not your emotions! Once you allow this to happen, you will finally see Consistency in your trading.
So Let’s Review……
The key to seeing CONSISTENTCY in your trading is as easy as 1-2-3
ü 1. IDENTIFY
ü 2. ADJUST
ü 3. EXECUTE THE TRADE!
No matter where you are in your day trading career, whether you’re just starting out or have been trading for a decade; these three easy steps will improve your trading.
Good luck, and follow your rules!
Sincerely,
School of Trade
TRADING YOUR WAY TO CONSISTENT PROFITS WITH A DAILY ROUTINE
Having a daily routine is crucial to any successful trader, whether they trade futures, stocks, options or the forex market. The daily routine used at the School of Trade has helps hundreds of traders use a simple and concise 3-step plan, in turn leading to more consistent profits. No matter how busy your day is outside of trading, sticking to a plan is the first step to becoming a professional trader. This is done by performing the daily routine, day in and day out, CONSISTENTLY. Below are 3 EASY steps to follow for a better daily trading routine:
Step 1: IDENTIFY
When you begin your trading day, it’s crucial that you try your best to identify specific roadblocks that might come up throughout the trading day. It can be easy to get quickly overwhelmed by all the information available for traders, but for starters you might want to consider just focusing on important market changing events. Specifically News Events that are related to the market(s) you trade. Find out the exact time during the day so you can be prepared for increased volume in the markets.
Another idea to consider is watching the Pre-Market and/or reviewing what has occurred to price since the open of the market (We will go over the benefits of 24-hour charts VS daily charts in an upcoming article). When you do this it makes it very easy to: Identify what type of market it is today; trending (higher highs, lower lows) or sideways (double-tops and bottoms etc.). This can help tremendously when you’re choosing which type of set-ups you’re going to use throughout the trading day.
Step 2: ADJUST
Trading is all about being prepared for what might occur in the future, and adjusting accordingly. Of course no one can predict the future, but you can help your probability of success by knowing specific times throughout the day not to trade….. (News events, meetings etc.). What I’ve found helps me the most is to set an alarm clock, that way you know ahead of time when to sit on the sideline of the markets.
Also, marking key Support & Resistance levels, whether it be from the pre-market or past trading days, is crucial to your consistency as a trader. The reason it is so important is because price will tend to gravitate to specific levels of support or resistance from prior trading days. There are many ways to identify areas of support and resistance, from trend lines to slower timeframes, which will enable you to adjust your trading according to how the market moves around these important levels.
Step 3: EXECUTE THE TRADE!
Once you have identified the ideal trading opportunities and made the proper adjustments to your trading routine, it’s time to execute the trade. To do this, Patience & Discipline are of utmost importance. Having patience and discipline, especially when you’re waiting for your perfect trade set-ups, will intern help you become a consistent trader. This is accomplished by let your Rules trade for you, not your emotions! Once you allow this to happen, you will finally see Consistency in your trading.
So Let’s Review……
The key to seeing CONSISTENTCY in your trading is as easy as 1-2-3
ü 1. IDENTIFY
ü 2. ADJUST
ü 3. EXECUTE THE TRADE!
No matter where you are in your day trading career, whether you’re just starting out or have been trading for a decade; these three easy steps will improve your trading.
Good luck, and follow your rules!
Sincerely,
School of Trade
Jun
14
Ian K
I am starting to build a core portfolio of large-cap/blue chip stocks as a foundation. By the time I’m done I want about 7-10 stocks across different market sectors. I want to buy these at the right times based on where the economy is in its cycle. Given the current market, where should I start to look for the first 2-3 stocks for my portfolio? I’ve been considering XOM and MSFT thus far.
I am starting to build a core portfolio of large-cap/blue chip stocks as a foundation. By the time I’m done I want about 7-10 stocks across different market sectors. I want to buy these at the right times based on where the economy is in its cycle. Given the current market, where should I start to look for the first 2-3 stocks for my portfolio? I’ve been considering XOM and MSFT thus far.
Jun
13
Day Trading and Its Psychology
Filed Under Investing | Leave a Comment
Pauline Go
If you start day trading and your heart starts pounding with nervousness, then you are not ready to begin trading. Day trading psychology plays a very important role in trading and many books have been written about it to prepare traders for this event. However, most books do not offer a practical solution to the nervous which eggs you to make so many other mistakes.
In order to be successful in day trading, you must have confidence in your strategy. Unfortunately, most traders are not at all confident and this is especially true for novice traders. On the other hand, if your trading strategy is not making money consistently, it is rather difficult to be confident about it. The best way to gain confidence in your trading strategy is to practice trading in simulation mode and then judge it. Most novice traders and the ones with few years experience are afraid of losing money. This fear can be done away with by using a trading simulation tool.
Day trading psychology is all about building up your confidence and nothing works better than consistent profitable results.
Many so-called professional traders might tell that using simulation trading is an utter waste of time. However, it depends on how and why you use it. The idea is to take a simulation strategy that has a defined number of setups, specific strategy for limiting your losses and then sticking to the strategy no matter what happens. This is the best way of testing your strategy and it will help you tremendously in real time.
If you start day trading and your heart starts pounding with nervousness, then you are not ready to begin trading. Day trading psychology plays a very important role in trading and many books have been written about it to prepare traders for this event. However, most books do not offer a practical solution to the nervous which eggs you to make so many other mistakes.
In order to be successful in day trading, you must have confidence in your strategy. Unfortunately, most traders are not at all confident and this is especially true for novice traders. On the other hand, if your trading strategy is not making money consistently, it is rather difficult to be confident about it. The best way to gain confidence in your trading strategy is to practice trading in simulation mode and then judge it. Most novice traders and the ones with few years experience are afraid of losing money. This fear can be done away with by using a trading simulation tool.
Day trading psychology is all about building up your confidence and nothing works better than consistent profitable results.
Many so-called professional traders might tell that using simulation trading is an utter waste of time. However, it depends on how and why you use it. The idea is to take a simulation strategy that has a defined number of setups, specific strategy for limiting your losses and then sticking to the strategy no matter what happens. This is the best way of testing your strategy and it will help you tremendously in real time.
Jun
12
NobleTrading
Day trading is one of the most active forms of trading which require high position sizing and quick responses to market changes. Because of this activeness, day trading involves more risk. The requirements of day traders are also high including real-time market access, news, charts and powerful technical analysis tools; and any system failure, wrong information or ineffective price analysis can result in huge loses. Reducing the risks involved is essential and here are some suggestions for that.
1. Targeting stocks of certain groups or industries.Specializing in stock of a handful of known industries or companies helps you to study the market deeply and to find more profitable trading opportunities. But never over specialize on one industry or group of companies, as this can increase your risk to market.
2. Creating and trading from a Hot/Short list of stocks. Create a list of stocks which fall in to your day trading regulations, such as price, volatility, risk, news trading, etc. Now you can screen stocks to be traded from this short list.
3. Updating your Short List. Regular modification of your day trading short list is also important. Constantly remove equities which no-longer fulfill your regulation or which have lesser trading opportunities, and constantly add new equities/groups which satisfy you regulations.
4. Practicing basic risk minimizing tactics. Like using of stop losses, never adding to losing positions and closing positions when market is against you.
5. Keeping low risk levels. Find a suitable risk level according to your account size, stocks trading, risk capital involved, margin usage, etc. It is good to limit risks below 1-2% of your account size.
6. Using lesser number of but effective technical analysis tools. Technical analysis and stock screening is always necessary but be sure that you are using the right tools at the right time to evaluate the right stocks.
7. Never trading in high uncertainty. It is always the better option to keep the money in hand for profiting from future opportunities than wasting that on totally uncertain positions.
8. Limiting the frequency of trades. Never trade stocks because of greed, trade only when there is an opportunity. It is better to concentrate at one trade a time, as it helps you in active management of trades and better position sizing.
9. Being vigilant with your margin trading. Trading on margin is a double edged sward; it can magnify your profit but also can magnify your loss. Keep reasonable margin levels with respect to your position size, profit goal and shares traded. High margin trades are better when you are sure about price direction. Beginner traders should use lower margins.
10. Evaluating your success and failures. For that write down all your trades, including what helped you to profit from the trade or what caused you to suffer loss. Go through them regularly.
Day trading is one of the most active forms of trading which require high position sizing and quick responses to market changes. Because of this activeness, day trading involves more risk. The requirements of day traders are also high including real-time market access, news, charts and powerful technical analysis tools; and any system failure, wrong information or ineffective price analysis can result in huge loses. Reducing the risks involved is essential and here are some suggestions for that.
1. Targeting stocks of certain groups or industries.Specializing in stock of a handful of known industries or companies helps you to study the market deeply and to find more profitable trading opportunities. But never over specialize on one industry or group of companies, as this can increase your risk to market.
2. Creating and trading from a Hot/Short list of stocks. Create a list of stocks which fall in to your day trading regulations, such as price, volatility, risk, news trading, etc. Now you can screen stocks to be traded from this short list.
3. Updating your Short List. Regular modification of your day trading short list is also important. Constantly remove equities which no-longer fulfill your regulation or which have lesser trading opportunities, and constantly add new equities/groups which satisfy you regulations.
4. Practicing basic risk minimizing tactics. Like using of stop losses, never adding to losing positions and closing positions when market is against you.
5. Keeping low risk levels. Find a suitable risk level according to your account size, stocks trading, risk capital involved, margin usage, etc. It is good to limit risks below 1-2% of your account size.
6. Using lesser number of but effective technical analysis tools. Technical analysis and stock screening is always necessary but be sure that you are using the right tools at the right time to evaluate the right stocks.
7. Never trading in high uncertainty. It is always the better option to keep the money in hand for profiting from future opportunities than wasting that on totally uncertain positions.
8. Limiting the frequency of trades. Never trade stocks because of greed, trade only when there is an opportunity. It is better to concentrate at one trade a time, as it helps you in active management of trades and better position sizing.
9. Being vigilant with your margin trading. Trading on margin is a double edged sward; it can magnify your profit but also can magnify your loss. Keep reasonable margin levels with respect to your position size, profit goal and shares traded. High margin trades are better when you are sure about price direction. Beginner traders should use lower margins.
10. Evaluating your success and failures. For that write down all your trades, including what helped you to profit from the trade or what caused you to suffer loss. Go through them regularly.
Jun
10
Ash
I am playing a stock market game at school and I would like to know some stocks that will make me good profits in a short period of time. I have about six weeks left and $100,000 of pretend money. So far I bought BIDU and SIRI and have made nice profits from BIDU. I recently bought SIRI because of the possible merge with XM. Thank you.
I am playing a stock market game at school and I would like to know some stocks that will make me good profits in a short period of time. I have about six weeks left and $100,000 of pretend money. So far I bought BIDU and SIRI and have made nice profits from BIDU. I recently bought SIRI because of the possible merge with XM. Thank you.