Is Day Trading Easy?
Day Trading is a stock trading art form that very few traders are willing to try. It's gained an infamous reputation over the years as a risky way to make money. But very few people actually know others who day trade for a living or people who have even tried it. So this causes one to wonder how this bad reputation started and whether it's actually true or not. Before I started trading stocks, I to asked the obvious question: "Is day trading easy?" Well since then, I've successfully traded as a long-term investor, as well as a day trader. So now I can fill you in and tell you why I think day trading is both easy and hard.
The main reason why day trading is easy, is because you don't need to have as much patience as you would if you were investing over the long-term instead. I'm naturally a very impatient person, so I find it much easier to sell my shares in a company each day rather than wait a long time while constantly worrying if I'm holding on to my investments too long. Most day traders try to make sure they sell a stock at a profit sometime within the first 48 hours after buying an investment or stock.
In addition to these reasons, many day traders find it easier to pick new stocks to buy each day rather than sticking to a particular few over a long time frame. This is because they have less of a chance of growing sentimental towards a particular stock. When you become sentimental in regards to your investments, you may become reluctant to sell them. In this sense, sentimentality clouds judgment and can lead to bad decision-making.
But there's always two sides to any story, and while some people find day trading to be easy, many more people have found it to be very difficult and hard. They certainly have some pretty good reasons for feeling that way. Day trading is only easy when it comes to certain aspects, but also hard when it comes to other aspects. For one thing, people who daytrade have to pay much more taxes because of the capital gains tax, at least in the United States. If you hold on to an investment longer than a year, you don't usually have to pay the same taxes as you would if you were to sell before then. Another reason why it can be hard is because lots of people find it to be very stressful. When you buy and sell stocks every day or multiple times during daytime hours, you're constantly having to make quick decisions and always watching your investments at all times. So it's easy to see how all of this can lead to stress and even aggravation sometimes.
Lastly, think about the daily pressure of having to cut your losses whenever you buy some stocks that aren't performing as well as you had hoped for. Day traders usually try to cut their losses each day if they incur any and try move on to something new before they bury themselves too deep in one company or stock. This can be very difficult for some people to do, because nobody likes to lose money and selling your stock is admitting and realizing a loss. A long-term investor doesn't have to deal with this as often, because they can hold out for years before selling if they still have faith in their investment.
So as you can see, the world of day trading can be both easy and hard. It all depends on which things you'd rather avoid. I personally prefer to day trade because of my impatient personality and ability to deal with daily stress, but you may be different and have different preferences than me. If you're just starting out,then maybe you should give it a try to see if you're good at it or not. But if you do decide to try it out, you should only start out with a very small amount of money that you can afford to lose, just in case.
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