Share Trading Blogs

How to Make a Profit in Daytrading

For many, making a profit daytrading is a task left to the professionals. For some it is a profitable business venture. For the sceptics, it is questionable whether or not daytrading is a profitable and viable trading activity. So, how do you make a profit daytrading?

A Lesson in Leverage

One of the main advantages of CFD Trading is the ability to apply leverage. The most important part of trading with CFDs is to understand how they work and how the leverage can act like a double edged sword. A trivial topic to discuss but an important lesson to reiterate. CFDs can be traded long or short, as such you can lose out either way if the market goes against you. What is leverage?

High Frequency Trading

For Wall Street Traders, high frequency trading is a Godsend. For "mum and dad" investors - sharemarket participants who hold for the long term, this market activity won't disadvantage them as much. However for retail day traders, this type of trading would disturb you. High frequency trading has been credited as being the method big banks and hedge funds such as Goldman Sachs has made a profit in the last year, even with the Global Financial Crisis (GFC) happening.

Executing Trading Checklist

An important skill to learn is how to execute a trade with confidence with a trading checklist. One of the most common exercises of a retail day trader is to “pull the trigger” or entering a trade. You look at the days news, fundamentals and technicals and when you decide to open a position you simply call your broker or execute the trade online using your software or browser. Simple isn’t it? But have you has times when you got stuck between the decision making stage and the actual exercising your decision? Have you ever missed a trade because you hesitated, got cold feet or were simply indecisive at the time you needed to execute your planned trade?

Risk Free Trading

You must be dreaming! Trading is inherently full of risks. There is no such thing as risk free trading. Or is there? If you start paper trading, or using a trading simulator you are effectively trading without risk. If you decide to go down that route remember to keep a trading journal to record your feelings and decisions. Trading on paper is not the same as trading with money on the line - even if you risk relatively small amounts of money.

Share Trading is a Business

As a professional trader, you should treat share trading as a professional business. If your are actively trading stocks, forex, or CFD’s it is of vital importance for you to treat your trading activities as a business.

Financial Market Cycle

We’ll examine trading the financial market cycle – a continuation of the discussion from here. There are four stages to the financial market cycle: The first stage of the stock price cycle is “Indecision”. Stage two is indicated by a rising trend pushed up through greed and market euphoria. Stage three is another period of indecision. Stage four is a period of time where prices fall and the market is gripped with fear and panic. Then the cycle returns to stage 1.

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