From a strictly personal perspective, I believe that "Short-Term Trading" has many advantages over "Buy & Hold" Investing, specifically; I believe it allows the trader to maintain control of his investments, using technical analysis, without depending on "luck" to profit in the market.
Let me provide just one example that I'm sure you will recognize; General Motors, now known at Motors Liquidation Company. The long term investor (buy and hold) is now living a financial nightmare.
The story is a heartbreaker for any General Motors "buy and hold" shareholder.
Motors Liquidation Company, formerly General Motors Corporation, is engaged primarily in the development, production and marketing of cars, trucks and parts. The Company develops, manufactures and markets vehicles worldwide through its four automotive segments: GM North America, GM Europe, GM Latin America/Africa/Mid-East and GM Asia Pacific. In addition to its automotive operations, the Company’s finance and insurance operations are primarily conducted through GMAC LLC. GMAC provides a range of financial services, including consumer vehicle financing, automotive dealership and other commercial financing. In June 2009, the Company filed for bankruptcy. In July 2009, the Company announced that the United States Bankruptcy Court for the Southern District of New York approved the sale of substantially all of General Motors Corporation's assets to NGMCO, Inc., an entity funded by the United States Department of the Treasury. In July 2009, the Company emerged from bankruptcy protection.
A look at the chart tells the entire story.
But a Day Trader or Short Term Trader, looks for stocks that continually go up and down (which is natural) $1 or more a day, or every few days if "Swing Trading", and jumps on board, either at the perceived top or perceived bottom, buys a 1,000 shares, and when they see their pre-determined goal met for the day or the period, sells their position, puts the money in their account, and waits for the next opportunity.
While occasionally, Day Traders will make bad calls, by limiting their trading activity to minutes, hours, or days, and faithfully watching their monitors while a trade is in play, they control their assets with - Few Surprises.
Here's an example.
This Oil Service Company is constantly on the move, up and down, and as you can see on this 1 month chart, the opportunity to take $.25 - $.50 a day is provided on a regular basis, if you have this stock in your basket of stocks, and regularly buy and sell 1000 shares of stock per trade, the returns can be exciting, and in your control.
By daily following sectors and having a few select stocks in each sector, representing your basket, you can move with the market. If the market is excited about medical stocks one day, but the next day it's switched interests to tech stocks, and the next day it once again switches, this time to oil or oil service stocks, the opportunities constantly present themselves to a trader.
During my time in Corporate America, I was employed in sales and marketing by the dedicated cardiovascular unit (company), of a diversified medical manufacturing corporation.
My days and nights were spent in hospital diagnostic, therapeutic, and recovery units, and for 30 years each of the areas where I spent my time had one thing in common, EKG Monitors which constantly provided the practitioners, nurses, or technologists, "real time" technical status reports on the patients they were responsible for.
Every second during the monitoring process of a patient, the EKG would continually change, and the staffs were trained to read the monitors looking for subtle changes in the patient that might give an immediate heads up on the patients status, whether good or bad.
Without the technical information provided by the EKG monitor, the quality of the patients care would have been compromised.
Day Trading involves the science of technical analysis.
"Real Time" Analytical Trading Charts provide the Trader, sometimes subtle, sometimes not-subtle information on the second by second changes of the sentiment of the market to a specific stock, which the informed Analytical Trader can use to their advantage to enter and exit from a trade.
Without the analytical training and experience, in my opinion, the Trader is haphazardly setting themselves up for costly losses. But the analytically trained and experienced Trader can use the information available to them, to stack the odds for a successful and profitable trade, in their favor.
Globalization has changed the face of the Global Equity Markets, and soon, an Independent Day Trader will be able to participate in the "active" markets, 24 hours a day!
It's hard to even understand the financial opportunities that will be available in the very near future, for a Professional Student & Strategic Trader Of The Global Equity Markets.
The World Is Constantly Changing, and soon, the Global Stock Market will be open 24 hours a day. The opportunities brought about by change. are unlimited. As in every "for profit" business (and trading is and should be considered a business), calculated risks are made with the intention of earning profit, and when a Short Term / Day Trader has placed a trade, it requires total focus on and knowledge of, the technical details that are occurring.
Before a Short Term / Day Trader has placed a trade, they put the odds of winning in their favor using the collective knowledge and education they have acquired from continued study of the the markets, and during the duration of the trade’s life, whether seconds or several hours (but seldom overnight), total concentration is given to the trade.
It is very serious business, the results of which can exponentially build wealth. The Rules are simple - Take your cash, make your trade, and quickly get back into a cash position, where Safety & Profit live.
The “Cash Is King” is the code a Short Term / Day Trader must live by.
When I decided to begin my Day Trading and A/V Production businesses, I had no intention of ever becoming involved in training others to the nuances of Day Trading.
I remember when I was first learning to trade the stock market and the many thousands of dollars I gave to stock market gurus, in exchange for an incomplete education, which cost me a lot of money when I began trading.
Without education, 90% of people will fail in their trading of the market, and the last thing I believe anyone needs is a guru to teach them.
However, I do believe that if the information is presented in audio and video form, just as an introduction, but with a little advanced information thrown in, and the price of the knowledge is minimized, it can be a worthwhile endeavor and investment.
So, after noting that many other "Gurus" I once paid money to for an incomplete education, are still out there doing to others, what they gladly did to me, "Took My Money", I have decided to compete with them, and provide the knowledge that I paid a great deal for, at a price that everyone interested can afford.
And that will be done through my Independent Audio/Video Production Company, soon.
Until then, I will be working diligently to prepare educational products - that work!
