Active Traders And Short Term!

Discussion in 'General Trading Discussion' started by TraderAnalyst, Sep 15, 2019.

  1. TraderAnalyst

    TraderAnalyst Senior Investor

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    Active traders buys and sells securities that are based on short term movements. They think that profits can be made from short term movements of prices. Where active trader believes in short term trading passive trading sees a long term goal.
     
  2. J_C_Anderson

    J_C_Anderson Senior Investor

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    Some traders prefer short term trading since it allows them to reduce trading risk substantially. The main advantage of short-term trading is the possibility to avoid a risk related to unexpected gaps caused by news released between trading sessions. Depending on the news, such gaps could be either in favourable or in unfavourable directions. This makes difficult for the trader to manage risk because such gaps could be so large that price decline would exceed the initial stop loss level. That is why most of the traders choose short-term trading strategies to avoid exposing their positions to the risks associated with holding the positions overnight, because this trading style requires larger trading capital allowing trader to deal with temporary price fluctuations. Since most of the newbie traders have limited financial capabilities, they prefer strategies with lower risk level.
    Another advantage of active daytrading is the possibility to make profit in any market conditions. This trading style is very flexible and provides a wide range of opportunities for those traders who can manage risk properly.
     

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