Myth: Day trading is risky.
Truth:
Day Trading is actually one of the safest trading methods available.
Why do you think all major hedge funds and mutual funds day trade? Because its
profitable and safe. People always confuse trading and investing and we are
talking trading here, not investing. In the past day trading got a bad
reputation because the tools like eTrade became available to the outsiders yet
they did not have the knowledge needed to use the tools effectively. When the
market was always going up like in
1998-1999 it was easy to do any trading and make money, even for outsiders. Then
the tech crash of 2000-2001 and the outsiders lost a lot of money day trading.
They told all of their friends that they lost money day trading and the myth was
born.
Times have changed:
The tools and education for day trading have improved tremendously and the
markets have changed to make day trading even easier. Insiders are not looking
for the next hot stock, they just follow one market index like the S&P 500 and
learn what the other insiders have learned about how the market moves, when the
market moves and what happens just before the market moves! The great thing
about day trading is that you only have to be concerned about what's going on
while your trading! Take a day off and don't worry. Insiders trade for an
hour in the morning and bring home some extra money.
Just follow the market:
The world is a much different place after 9/11 and the markets are affected by
things happening around the world while your sleeping. So why be in a trade
over night? Day trading is safe because of the fact that you are never in a
trade over night, the trades only last an average of 5 minutes. That’s
important. The recent market crash we had in March 2007 started in Asia and
affected our markets much later. By the time the US exchanges were open many
people who were betting the market would continue to rise the day before could
not get out fast enough and lost money. Day traders with insider knowledge made
a lot on that same day because when the market opened they just followed it
down, down, down and their account balances went up, up, up!
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