By: Kimberly Nix Murray
Day trading in this market. People have asked me is it worth day trading in this market when nothing is making sense and what is day trading? Day trading is when you buy and sell the same stocks in the same day capitalizing on the short-term changes in price. If you decide a stock is going to go up then you go long on it, if you think a stock is going to drop in price then you short it.
Here at ELITE TRADER, LLC, www.fastmoneytraders.com we have a proprietary scanner that we share out to all of our clients. We have a collaboration of day traders that share ideas and stock picks. We run a daily chatroom that opens up 30 minutes prior to the bell ringing. Depending on the market, we sometimes alert trades presale or after the market closes. There is a saying, “Day traders that trade together, win together.” With all of the news and research that is out there, it only makes sense that a group of day traders can fare better than a single person trying to grasp all of the material that is flooding the market.
Can you make money at day trading? Most day traders do not make money at day trading either because they are not disciplined, do not have a plan or they lack an edge. There are a lot of psychological aspects to day trading and many people do not know how to manage their money.
I cannot tell you how many people over the years who have sent me stock certificates that either they inherited or held on to and now are worthless. You need to know when to buy and when to sell stocks to make money and holding onto stocks can be a downfall. Of course, many people will argue if you had bought stocks in Apple $AAPL in the 1980s when it was $22.00 a share and held on to it, of course you would have made money. Let’s say you purchased 100 shares at $22.00 a share in 1980, today you could sell your stocks for over $14,400. If you had bought a 1,000 shares of Apple stock in 1980, it would have cost you $22,000, but you could sell it and earn over a $144,000 today.
But anyone who bought shares in Siboney Corporation $SBON, a company that sold educational software and own the stocks would cost them more money to sell it than just hold on to the worthless certificate. Each share is worth less than a third of a penny today. My uncle owns 140 shares, which is worth about 40 cents today.
Which is why it makes more sense to buy and sell and not hold on to stocks that may or may not be here in the future.
Disclaimer: The information provided in this article is as a service to investors. It is neither a legal interpretation or, a statement of policy. If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law. Stop Loss orders and Stop Limit orders may not be available through all brokerage firms. Investors should contact their broker to determine which orders are available for buying and selling stocks, and their broker’s specific policies regarding these types of orders.