Trading, business and the financial market is a big, complex world. There’s foreign exchange, currency trading, and even day trading. And perhaps, it is day trading that needs more than just a simple mention in the book, for one, foreign exchange and currency trading are relatively easy to understand, day trading is a whole new concept. Simply put, day trading is the buying and selling of financial investments and securities within the same trading day. These financial investments and securities would include stocks, stock options, currencies, and contracts like equity index futures and commodity futures.
As opposed to swing trading where the stocks are held for a couple more days, the stocks in day trading are held only for the duration of the trading day. Day traders buy and sell securities during the day, and do not hold stocks overnight. Anyone interested in day trading must have enough capital for him/her to be able to buy at least 1000 shares of a particular stock on a particular day. A neophyte in this venture would do well to save around $25,000 for him to be able to play in the market. Furthermore, this should be treated as a 100 percent risk capital. Day traders should know how to cut their losses short. They should know to trade along with the trend, go with the flow, and never to get emotionally attached to their trades. It is advised to trade high volume, popular stocks as they are easier to sell at the end of the trading day.