The Essential Guide to Trading: Intraday Trading

By: Candice Hubbard


Managing your Trading Account to maximize your investments potential is full of pitfalls. The key to market success understands.

The Short-Term Trader

A short term trader focuses on trading their portfolio on a day to day or a session by session basis, this means that the trader is focused on making fast, short term transactions, buying when prices are low and selling when prices are high. The advantages of short term trading are also the disadvantages. Short term trading involves high risk as success as a short term trader means being able to successfully navigate volatile markets.

The Long-Term Investment

If you are a small-scale operation then trading solely on short term trading is ill-advised as the inherent risk reduces your chance of long term profit. Because of this, long term investment is a completely different skill set and requires the investor to look at the markets with an eye to gain or loss over time.

Intraday Trading: Defined

The term describes trading that takes place with a single day and usually during normal business hours; this means that your investment is traded against the rates of the stock exchange. These funds are usually referred to as Exchange-traded funds.

Working your Trading Account

There are a number of different strategies to navigate the stock markets and all have their inherent successes, failures and risks. For example, a purely short term trader has the potential to make big money but as your investment is constantly moving from stock to stock, the risk of losing it all is very high. Whereas a long term investor has a certain degree of security, as much as one can have on a live stock exchange, as their plan is to monitor an investment with an eye to the future, the flip side of this is that you may go for long periods with no significant gain or loss. A solution would be to combine both long term and short term models.

Option One: Separating You Long Term and Short Term Investment

If you like the idea of Intraday Trading but are do not want to completely turn your investment into an inherently risky Exchange-traded fund then you could ring fence a small portion of your investment for the sole purpose of short term trading. This will allow you to make small profits without risking your overall portfolio.

Option Two: Long Term Investment with Short Term Tweaks

The other option is to monitor your long term investment with an intraday eye. This way, you can take advantage of any opportunities that occur in the financial markets, in relation to your long term portfolio, this could be as simple as buying a few more of selling a few of your stocks in reaction to a rise or fall. The goal here is still long term, but this type of activity will help keep the markets active and will take away some of the stagnation that cam come with long term investments.

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Candice had multiple Trading Accounts. She is currently writing a book about Intraday Trading and personally believes that gambling on the stock market with a small amount of stock, one day a week, keeps her mindful of the risks involved in trading.

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