What is Day Trading?

Trading in securities on a daily basis is also called day trading. The intention is to make optimum use of price fluctuations during the trading day. Day trading for women is something that is often romanticized. Many people have the impression that thousands of dollars are earned just behind the computer 100% fairly. carelessly and easily. In reality, however, it is not that simple. These days, the trader fights against complex and advanced algorithms, and that resembles an unfair battle. Algorithms respond faster than humans will ever be able to. Day traders close at the end of the day to avoid risks. So, day traders take new positions every day. No one can really say anything meaningful about the profits of day traders. Even scientific research cannot indicate precisely whether day traders make a profit or a loss. It only makes the myth around day trading even greater. Overnight The difference between day traders and normal traders lies in the fact that a day trader closes its position at the end of the day and does not take it into the night. On the one hand, this reduces the risk. After all, stock markets worldwide open at different times, so things that happen on the other side of the world can affect the value of proprietary financial titles, without the trader being able to intervene. In jargon this is called the so-called overnight risk. And so the day trader closes every day to take a new position the next day. Online broker There are nowadays trading houses that employ day traders and since there is broadband, you can also trade from home. This is done via an online broker. You also see day traders at work at trade offices. They rent a desk and trade facilities there. You will see the latter more in America and less in Europe. Day trading requires constant sharpness and focus and moreover it is 'forbidden' to think about tomorrow. For today, trading is the only thing that matters. What comes tomorrow they will see tomorrow again. Want to know how day trading works and how you can earn extra with stocks trading / Forex trading? Here's a special guide to Trading for women. Here you can find great trading tips for beginners. Scaling Day traders use different strategies. The actual number of transactions per day can vary from a very limited number to as many as thousands. The time span that is taken to maintain a position is also different and ranges from hours to flash trading, often a matter of seconds. Flash trade is also called scalping. However, the situation that positions are held a little longer is called swing trading. In addition, high-frequency traders are distinguished who can enter and exit within a millisecond. High-frequency traders are therefore usually algorithms. Go long and short If there is going long, this means buying, going short means the opposite: selling. Day traders mainly follow the technical analysis when making the decision to go short or long. In addition to that technical analysis, they rely on the order book, current developments and sometimes on the movements that make other effects and possibly have influence. Day trading is relatively expensive, especially if many transactions are being carried out and the commissions to the broker can therefore run high.