If you ask people the benefits of day trading, they are more likely to say the money you can make and the freedom the venture offers. However, there are many more amazing things that day trading can offer. Yes, the practice calls for time management and discipline, but it ideally affords you to make your hours without a boss or manager standing over you back.
That being said, here are the many other advantages of becoming a day trader:
Easy to Get Into the Game
One of the best things about day trading is that it is very easy to get started. If you are trading penny stocks, you do not need to become a licensed trader, and neither do you require to complete a course and get a certificate. As long as you have internet connectivity and a computer, you can become a day trader in just minutes.
Unfortunately, this tends to be a double-edged sword. While it is relatively simple to get into the game, most people do it without adequate information, and that is why over 90 percent of traders lose. That’s why it is imperative to get educated before jumping in. Fortunately, there are tons of resources online that can help you in just that.
You’re Your Boss
Just imagine working at the comfort of your home, sipping coffee and executing trades, but something is missing- your manager or boss breathing down your neck? When it comes to day trading, you are your boss. You do need to ask permission for trades, and you’re not obligated to meet the demands of another individual. You’re responsible and accountable for your performance. However, it’s important to keep in mind that such freedom calls for ultimate self-discipline.
Free Information & Resources
As with any industry, there’s a lot of study and knowledge required to become a successful day trader. However, you do not need to be an expert in the field of investing. There are numerous resources online that you can get for free to help start your day trading career. You can, of course, buy a trading software to give you instant news, stock information, and charts, but if you are just getting started, this could be a poor decision.
Numerous websites provide an opportunity for people to learn day trading on demo accounts or software.
No Overnight Risks
Another good thing about day trading is being able to close your position at or even before the end of the trading day. If you do this, the risks of holding a stock overnight are eliminated. With conventional long-term trading, your profits can disappear overnight, but this isn’t an issue when you decide to become a day trader. If it was a good trading day, then you can be confident that you will sleep soundly.
Focus on Technical Analysis
When you venture into trading, you will come across two common types of analysis: fundamental analysis and technical analysis. Conventional long-term traders tend to focus on the former as they need to look at the health of a company, management information and financial statements to determine how the stock value will shift in the long haul. Even though this information is essential, as a day trader, you are more likely to depend on technical analysis to make quick and successful transactions throughout the day. That’s primarily because day trading often involves what is happening at the moment. What’s the current stock price, volume, and volatility at the moment?
Succeed in Poor Market Conditions
Day traders can usually take advantage of a struggling market by using short-selling strategies to take advantage of stocks that are falling. The ability to make profits in bear market conditions is a huge advantage for a knowledgeable day trader.
It’s Possible to Make a Lot of Money Fast
After all, this is the reason you are here, isn’t it? Day trading is more appealing to many because unlike long-term trading, it enables you to make money quick. However, it comes with more risk compared to its counterpart. As long as you are educated and have adequate knowledge in the stock market, you can make a substantial amount of money with day trading.
