What Is Day Trading?



What Is Day Trading?

Day trading is the practice of buying and selling financial instruments throughout the day. As the day progresses, prices will rise and fall in value, creating both the opportunity for gain and the possibility of loss.

At 10:15am, a day trader might buy 1,000 shares of Samsung Electronics Co Ltd stocks just as the price begins to rise on good news, and then sell it at 10:25am, when it's up by $1 per share.

In this example, the day trader makes $1,000, minus commission. With today's cheap commissions of $10 or less per trade, that's a quick $990 in just 10 minutes!

When traded strategically, the trends and fluctuations in the markets allow for quick profits to be made in brief periods of time.

Keep in mind, however, that day trading is specifically designed to result in smaller earnings on a regular basis; it is NOT designed to result in huge fortunes through a single trade.

Day trading can be very profitable, but it isn’t a get-rich-quick scheme (though many seminars convincingly sell it as such). Nor is day trading a sure road to immeasurable wealth and success (as some hyped-up websites would have you believe).

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