subject: Day Trading Online: What's the Big Deal? [print this page] One of two developments that led to the popularization of trading is its electronic form. The other one is the introduction of margin trading or trading using loaned cash. So what exactly is the big deal about electronic trading? This article examines this and other related issues.
The Upside
The electronic revolution in trading has a number of advantages, mostly related to information flow, time and speed:
Information at your fingertips. Everything you might is only one click away: quotes, news and trends, graphs, technical analysis programs, and research. The main impact: quick decisions about what and when to buy or sell or when to call it a day.
Flexible hours. Day trading online allows people to take it up after office hours. It can thus become a part-time job, even a hobby to break the monotony or stress of work. It may, of course, be adopted as a full-time job.
Opportunity for everyone.Just about anyone can become a trader. With the help of a broker, some real hard work to learn the tricks of the trade, and more experience, anyone can make day trading online a way of earning a living.
Quick response. Gone are the days when an investor has to call a broker to execute a decision. In these days, you do it yourself from your desk.
Low commissions for most online brokers. This affords the investor a wider range of strategies for trading.
The Downside
In the interest of balance, the pitfalls of online day trading should also be laid on the table. These are mainly the following:
Lost guidance. Day trading online allows the investor to make all the decisions without the benefit of advice from an experienced broker. Such a loose cannon could only damage itself, usually in spectacular magnitudes. In the end, the experience of a broker far outweighs any savings in commissions.
Trying to catch everything. With all the information available, it is easy to observe the ups and downs of the market. After a while, the trader is led to think that he can predict these moves and then tries to capture all of them.
The illusion that everyone can make money. Technology can give everything a would-be trader needs but it takes more than that to make money. In the end, good sense, discipline and education are still what the trader needs most.
Day Trading Online: What's the Big Deal?
By: Jared D. Ingram
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