How to Make Money Day Trading – Secrets You Need to Know
It’s sad but true: most stock experts won’t tell you how to make money day trading. In fact, a lot of them claim that this method of trading stocks is risky and unreliable. The truth is a little more complicated, though. If you’d like to figure out how to make money in stocks online, you need a sound strategy and a good idea of how the market works.
Day Trading: A Background
The first thing you need to understand is just what day trading is. Day traders are people who buy and sell stocks really quickly over the course of a single day. Most of these successful traders hang on to each stock for just a few minutes or hours.
Not just any stock will do, however. If you want to actually make money buying and selling over a short period of time, you need to look for stocks that have big fluctuations in their value. Companies that have this high level of volatility have what are referred to as “high betas.” The beta is a number that shows how much a stock fluctuates. You’ll usually see it listed by the company’s name in a standard stock index.
Some of the highest beta stocks are penny stocks. Despite their name, these properties trade for $5 or less per share. Companies with these low stock prices are actually in danger of being kicked off the Dow index, so they tend to be desperate for buyers. When you learn how to make money day trading, you’ll know that you can buy these stocks cheaply and sell them when the price goes up just a little bit, pocking a tiny profit. If you do this repeatedly, those small earnings will build up fast.
What’s the Catch?
The premise behind day trading really is that simple: buy a cheap stock and sell it as soon as its value increases. That may make you wonder why more people don’t use it as a strategy to make money in stocks online. The reason is that most beginning day traders can’t get the hang of it. They buy at too high a price or sell too early or late.
Many of the people who know how to make money day trading do it with specialized software that helps them target great opportunities. Others practice with a supply of money that they consider disposable. That takes a while, but it’ll help you build up the skills you need to make money in stocks online without risking too much. No matter what approach you take, however, you need to understand that this kind of trading takes dedication.
You can’t find out how to make money day trading by just choosing a few stocks on your cell phone every morning. You have to treat it like a part-time or full-time job to realize significant benefits. Spend time reading up on all the details the same way you’d research for your day job, and be willing to give this venture your full attention.
These strategies aren’t a sure way to learn how to make money day trading, but they can definitely help. With the right attitude and the assistance of the correct books and software, you too can have a chance in this exciting and volatile market.