Day trading is one of those stock marketing investing techniques that you’ve probably heard about. If not then I’ll go through the basics and you can decide if it’s for you. Personally, it’s not something I do. I have done in the past with a little success but not enough for me to do it 100% of the time. Don’t let that put you off however, had a read through the guide and make your own mind up. Maybe you’ll be better at it than me?

The idea is that you’re in and out with your trades by the time the market closes that say day. Hence the name. You’re basically buying stocks and selling them as quickly as you can even if that means finishing up with a loss that day. Oh and it’s not just about buying one type of stock and sitting on it. You could end up buying dozens that day but make sure you get rid of them before the end.

You might be asking what’s the point if you could end up with a loss at the end of the day? Well obviously thats not the intention, it just happens sometimes. The whole theory is that you can identify short term trends in the market. You buy stocks at the start of the trend and then sell them on when you think the trend is just about to finish for that day. In theory this should make you a profit. Forget about value investing and being in it for the long haul and all the other stuff I’ve been going on about. If you’re coming in to the market with your day trading hat on then that stuff is no use to you. It’s all about speed and a quick turn around time of the stocks your purchase not about pouring over numbers or using stock market software.

I’ve often wondered if day traders are one of the reasons why the stock market can be so jumpy. These guys tend to work from rumors and up to the minute market news. There’s no deep research gone into the stocks they’re buying. When you buy stocks like this it can push prices up or down and that flows all the way through the market so value investors like myself start to feel it. Well, for a day at least. To be a day trader you need to have a great deal of confidence and experience in what you’re doing as it’s based on split second judgements which could cost you a fortune. If you’re reading about stocks for beginners then forget day trading. It’s far too risky for noobs even if you are only trading a little bit of money each day. The broker fees will soon add up! If you’re more experienced and comfortable working in a particular market then perhaps this is the type of stock market investing that you could be successful at? Or will you stick with the traditional way to trade shares?