So, you want to Day Trade? Well, besides learning from
what I write in my blog as well as checking out the hottest stocks of the day, I have put together this page for people out there who want to know more about what day trading is
first thing you should know about trading stocks is that you can buy as many books as you
want to but they will never replace experience. Experience is probably the most important asset when comparinggood
traders and the bad. I do, however, recommend that you read a few books for the basics before you start daytrading.
One Up on Wall Street will give you general knowledge and Your Money Your Brainwill brief you on how our brains react to Risk, Greed, Fear, Confidence, Prediction, Surprise, Regret, and
Happiness. If you are serious about investing and trading, these are must read books. Also, read my example of when to buy a stock.
Now, what exactly is Day Trading? Day Trading is the buying
and selling of stocks very quickly, sometimes within seconds or minutes, in order to make money. Day
Traders love a very volatile and active stock market because this allows them to get in and out very fast, profiting
off of the large swings. A Day Trader will usually liquidate his/her positions before the day is
over ( one of my Stock Trading Rules ). Some Traders will hold overnight but most will stay in all cash because they never know what tomorrow will
bring. Stocks move mostly because of Earnings or Company News. Most Day Traders will not care why the stock
is moving up or down, they're only worried about how they can make money off of the stocks movement.
While Daytrading can but very Profitable, you can also lose A LOT of Money!
Day Trading is EXTREMELY Risky! It is estimated
that most new Day Traders will lose everything shortly after they start trading. This is usually due to the fact that
they are gambling because they haven't educated themselves on the Stock Market. Out of all Day Traders, roughly
5-10% will survive in the first five years.......the rest will go on to make bad decisions and lose everything.
However, those people who take the time to educate themselves and have patience, can really make a nice amount of money.
Ok, so how do you get started? After reading the books that I recommended above, you should go to a glossary and familiarize yourself with stock market
terminology. One great website for this is the Nasdaq.com glossary. Study, Study, Study! You should be able to know what 90% of those
terms on that website mean.
Next, go to a Financial Website like Yahoo! Finance. Explore! View the Most Active Stocks that particular day. Click on the different stock symbols and try to figure out why that stock went
up or down that particular day. Read recent news articles about that particular company. Click and view the
different Charts. You will end up going on an exciting journey exploring around the Internet. Once you get
a little more experience with researching different stocks, take a good look at technical charts via moving averages and
see if you understand where the technicals think a stock could be headed. Come back to my website, view My Blog. Even find out what other traders are watching by view my stock market forum. Most importantly, write down stocks that you want to know more about and track them everyday.
Soon you will be learning all kinds of new things and your researching will get easier. Track my Hottest Stocks of the Day.
Next, open a free Practice Simulation Account. There are
many different websites that offer a practice simulation account. This account will help you learn Patience
and discipline and it will be at no expense to you. After-all, these are the two most important traits of a successful
trader. When running this account, set goals for yourself. You will want to take awhile to practice!
Ok, after you have done well in your free practice account, it may be time to sign up for the real thing.
First I would make sure you have done all of the above. If you go to this Website would you be able to tell me what all of that data means?
If you look at this Income Statement can you tell me how fast Google's Revenues
are growing? Can you tell me how much they earned in 2007? Can you tell me who the CEO of First Solar is?
Well, if you can't answer those questions you need to research and practice more. If you did a good job, then
you might be ready to get your toes wet.
What a Day Trader Needs : A Day Trader needs a
great computer, maybe several computers all networked together. A Day Trader needs a GREAT Internet connection.
If you still have Dial Up or even DSL you are going to miss out big time. A true Day Trader has the fastest cable Internet
service that is offered by their cable company. After you get all of this set up, It's Time to Open a Brokerage
Account! Then check out the stock message board