SubscribeSome of the most popular day trading commodities are stocks, currencies, stock options and some futures that involve equity index’s, commodity futures and interest rate futures. Day trading used to be, and still is, the favorite among financial firms and investors. Many of the biggest day traders now are big banks like Bank of America, investment firms with tons of capital to trade. These companies usually have a whole team of very highly skilled traders doing the work for them on the Forex market.
Of course you can imagine what kind of money management strategies must be employed so that people like you and me don’t wake up to find our bank accounts wiped out over night. Day trading is always going to be the biggest money maker for big companies like Deutsche Bank, day trading in the Forex market has a daily turnover of $3.21 Trillion dollars. Think about that, thats more than the NASDAQ, Tokyo Nikkei, and NYSE etc combined! The sheer volume of this market is incredible, not to mention that it never closes because, well, it can’t!
Day trading has become more popular mainly because of the advances in technology in recent history. People can now automate their trades and watch their accounts more closely, depending on the Forex broker of course. Changes in the way a government works in a certain country can open up large opportunities for people to hold their money their, like Switzerland for instance.
Originally the most important U.S. stocks were trades on the New York Stock Exchange. A day trader would contact a stockbroker who would relay the order to a specialist on the floor of the NYSE. They would each make some markets in only a small stack of stocks. And so on and so forth, brokerage commissions were fixed at %1 of the amount of the trade. So if you wanted to buy $10,000 worth of stock, it would cost you $100 in commissions. Not bad for a day trader.
There are several techniques to ponder if you are considering day trading, most if not all are based on mathematic algorithms. Each technique is based on a certain trading style, so if you don’t like one then try another and so on, until you find what fits you best.
Here is a quick list of some of the techniques you do day trading with: trend following, contrarian, range trading, scalping, rebate trading, news playing etc etc. Too many to list here. I’d suggest researching each one and then give them a try, day trading can be extremely risky if you don’t know what you’re doing…the thing is, most people DON’T.
Some strategies require some sophisticated trading software and hardware. This stuff can run up to $50,000 or more! Many day traders use more than one monitor to even multiple computers to do their day trading. This is a very common practice among day traders. Some of these day trading softwares send signals into the market and present their feedback on the screen of the computer that is currently running that software, advising the user to buy or sell at that point. Needless to say that a fast internet connection is VITAL if you are to be successful at entering and exiting key trades.
Author: Luis Aguirre
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Article Author :Luis_Aguirre
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