you could do both if you were a pro. you can swing trade something and daytrade some other thing... when you are in the game you gotta keep active
I think everyone should be in the markets in some way.. but it is more than just what suits you... The net financial reward had better suit you also.. If you are not at the skill level to achieve this then you should rethink..
its a fun video game for many people. the money is often secondary, with "beating the game" being the primary motivation--win or lose. the unfortunate part of it is, those most attracted to it are often the most ill suited for the game. surf
<i>"In other words if you can turn 20k into 40k in a year daytrading (after commissions) and I can do the same swingtrading one hour a day while I have a regular job then you are doing it for reasons other than money because your time is not being compensated."</i> What if a good intraday trader can turn $5k to $40k in one month? Is that an acceptable exchange for time spent versus swing trading? Here's what you are honestly stating: "I can swing trade, I don't know how to trade intraday on a smaller timeframe. I cannot fathom the big picture being one hour's trend versus one month's trend. I'm ignorant (without facts and information), therefore I'm making negative assumptions about the whole thing." That is pretty much a summary of what OP has stated in this thread.
Wouldn't you say that, generally speaking (of course there are exceptions), the higher the timeframe, the larger the stop needed, the bigger the account needed, the more risk you incur on any single trade? Also, wouldn't you also say that if you have a trading method that gives you a statistical advantage, then all you need is repetition to allow that advantage to exploit the market (casino factor)? In my opinion, lower timeframes are used to control risk, and have a higher number of trades in a shorter period of time, which statistically will give a trader better opportunity to exploit their advantage. Then again, the video game thing is true too: http://www.etoro.com/ :eek:
please note: im certainly not saying that a good living can't be made daytrading. it certainly can be a great source of income, and can be better for those with less capital but skilled as they can turn the money faster earning more than swing trading the same amount. surf
HAHAHAHAAHAHAHAA!! now, i have really seen everything!!! thanks for the laugh. here's the game i was talking about: <img>http://www.online-future.com/platforms/mdtrader.gif</img> surf
I think it all boils down to a number of things: 1) Inability to hold overnight based on capital limitation: most brokers allow 4XAccount value for intraday trades vs. 2XAccount value for overnight positions. So you may perfectly take a day-trade intending to close it at the end of the day, while some other positions could be held overnight within the 2X bucket. 2)Some just want the peace of mind that comes with not holding overnight. They do not mind missing out on potential overnight moves in their favour. If you trade futures with even bigger leverage, it is even more pertinent. Overnight gaps can destroy pretty fast. 3) The opportunity cost of trading a long time frame. If you trade the news, and you are in earnings season, it is expected there will be a barrage of fresh opportunities the following day or even before (after hours). If you are all tied up in positions you cannot liquidate, you lose out on the opportunities coming up. I do hold different time-frames. For me, the swing type is more suitable for options, where you do not have to tie up a lot of buying power.
I think this is very true for me. I must say I do think of the market as being like a game where you have to figure out how to beat it. Before I started trading a used to play a game called World of Warcraft. I played prety much every day (had 3 lvl 60 chars) and I had thousands of gold. What I found most fun about the game was not the killing mosters or fighting dragons but trading. Thats right trading. The game had its own auction house where real players could go to buy and sell items. I used to watch it all day and when i saw a nexus crystal come up for a price cheaper that it should have been i would buy it and scalp it. I must say day trading in world of warcraft was ALOT easier than it is in the markets I made quite a few thousand gold but in my real trading I havent been able to turn a profit yet It was prety fun having all of that power of being able to buy all of one comodity and then make the price jump and watch as people have to pay it. After a while I realized that I had to grow up and start working on my real life fortune. I knew that people would pay real money for in game gold so i wrote a bot that played the game for me (fishing stonescale eels) I made several thousand gold at this but unfortunately they caught onto me and told me to stop or your banned. I had big plans for that bot .. i was going to turn it lose in the auction house and get it to do statistics on the prices but i never got that far. I tryed to sell my remaining gold but got scammed out of 4000 (about 400 dollars worth). Thats when i got into trading.
the ones who trade 100 times a day in a single stock are working for the (prop firms) brokerages who get a commission of any profit and the commissions don't matter. if you have to 1 cent per 1000 shares it's not feasible to trade 50 times because you commission is $1000 for the day as each round trip is $20. you do 50 round trips is $1000 in commission. you would need to make $2000 to justify the $1000 commission..the broker has no risk and not the doing any work and is probably trading against you when you are daytrding. only a few liquid stocks are daytradeable to trade 100 times..like the QQQQ