Day Trading stock market
Due to its nature and its volatility, the stock market presents many approaches to online stock trading. As a trader you are not confined to the long term stock trading strategies. Plying the day trading stock market is all about entering and exiting trade positions within the same day profitably.
Day trading stock market brokerages enable traders to go for exchanges that offer the best available price at that time. As a trader you can also have your order automatically routed to the exchange with the best price at that given time. This is possible thanks to the service of interactive brokers. In day trading stock market, automatic order routing is known as IB SMART.
The most basic way of profiting from the stock market is buying stock and waiting for its price to increase so that the stock holder can gain profit when they sell the stock they are holing. This strategy is known as a buy and hold trading strategy. In day stock trading you can also make profit by selling a stock and waiting for its price to decrease and then buy it back at a lower prize. This strategy is known as shorting stock. About 50 percent of stocks can be shorted (sold first) meaning that the remaining 50 percent is available for long trades which involve buying the stock first. This is due to the fact that the liquidity of the long trades stocks is too low to support shorting.
Unlike in other forms of trade, in day trading traders handle actual stock and not contracts. Nonetheless, there may be some contract specifications that detail aspects of each stock. What you can expect from a stock contract is the stock symbol such as MMM for 3M. Other information may be the available exchanges such as the NYSE, PHLX (Philadelphia Stock Exchange). You may also get details on the minimum price movement which is usually pegged at 0.01 as well as the order size increment which normal runs at 100 shares.
As a beginner, day trading may be a great place to start your trading career. The stock market has a wide array of different companies. In this market, many stocks can be traded in both long and short trading strategies. There is however one major hurdle in day trading especially for beginners. Regulation of this industry makes this form of trading not quite ideal for beginners who want to learn the ropes first and have limited risk capital. The US SEC ( Securities and Exchange Commission) http://daytrading.about.com/gi/o.htm?zi=1/XJ&zTi=1&sdn=daytrading&cdn=money&tm=151&f=21&su=p284.13.342.ip_&tt=2&bt=7&bts=7&zu=http%3A//www.sec.gov/ stipulates that day traders should deposit at least $25 000 in cash or securities (stock, options, futures contacts) with their brokerages. This can be a huge hurdle for someone starting out.
The relief comes in that these restrictions apply to the US stocks markets only. Beginner traders can explore European and Asian markets.
However, if you have what it takes and you can sustain the required equity in terms of cash or stocks in your day trading account the day trading stock market can be great place to generate income and diversify your trading and investment portfolio. Take note that if you decide to trade day stocks you must stick with stocks that have high enough volume of shares and volatility (range of movement) in tandem with your trading system requirements.
Next, explore this resource on Stock Market Day Trading; Winning Strategies and Mistakes to Avoid. http://thebusinessupdate.co.za/stock-market-day-trading-winning-strategies-and-mistakes-to-avoid/