Top Day Trading Markets
The expertise and depth of knowledge required to succeed in day trading makes it mandatory that you specialize in one or two markets.
You need to learn how the markets work and what the nuances are that everyone else in that market is paying attention to.
You need to know what kind of news items to watch out for and when and how they will effect your market.
It is simply not possible to specialize in more than a couple of markets, at least if you want a chance of doing your best, because of the sheer volume of information you need to absorb daily.
Here are brief descriptions of the three most commonly worked markets: Foreign Exchange: or "Forex" for short, is the trading of foreign currencies to profit from the changing prices of different currencies at any given time.
Since most currencies do not rise and fall in value against the dollar by a very large amount on a daily basis, the profits or losses in a day trade are small.
That is why you will be using borrowed money to "leverage" your trade.
Of course, this adds tremendously to your risk because this loan needs to be paid back that day, whether you made money or not.
The attractive feature of this market is that it functions 24 hours a day, every day except Sunday.
That gives traders a lot of flexibility to work around their schedules.
Stock Index Futures: or "Financial Futures" are based on the price movements of the main stock indexes like the Dow or the S&P 500.
These contracts allow you to speculate on price changes for much less than it would cost to trade the underlying securities but the price swings are far more pronounced exactly because they reflect speculation.
Stock Futures: This is the most popular market and is based on the price changes of common stock of companies that traders speculate on.
They watch the news on earnings and performance and make calls on which way a stock is going to go that day.
However, one needs to be careful with tax issues as they can take a huge bite off of profits.
NOTE: As always, please treat information you find on the Internet with care and if it fits your needs, please use it at best as a starting point for further inquiry.
Do your own due diligence and consult with qualified people.
You need to learn how the markets work and what the nuances are that everyone else in that market is paying attention to.
You need to know what kind of news items to watch out for and when and how they will effect your market.
It is simply not possible to specialize in more than a couple of markets, at least if you want a chance of doing your best, because of the sheer volume of information you need to absorb daily.
Here are brief descriptions of the three most commonly worked markets: Foreign Exchange: or "Forex" for short, is the trading of foreign currencies to profit from the changing prices of different currencies at any given time.
Since most currencies do not rise and fall in value against the dollar by a very large amount on a daily basis, the profits or losses in a day trade are small.
That is why you will be using borrowed money to "leverage" your trade.
Of course, this adds tremendously to your risk because this loan needs to be paid back that day, whether you made money or not.
The attractive feature of this market is that it functions 24 hours a day, every day except Sunday.
That gives traders a lot of flexibility to work around their schedules.
Stock Index Futures: or "Financial Futures" are based on the price movements of the main stock indexes like the Dow or the S&P 500.
These contracts allow you to speculate on price changes for much less than it would cost to trade the underlying securities but the price swings are far more pronounced exactly because they reflect speculation.
Stock Futures: This is the most popular market and is based on the price changes of common stock of companies that traders speculate on.
They watch the news on earnings and performance and make calls on which way a stock is going to go that day.
However, one needs to be careful with tax issues as they can take a huge bite off of profits.
NOTE: As always, please treat information you find on the Internet with care and if it fits your needs, please use it at best as a starting point for further inquiry.
Do your own due diligence and consult with qualified people.
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