Why Swing Trading?

When you hear about stock trading it’s almost inevitable that the talk centers around or refers to Day Trading.  It’s been the popular topic of conversation and all the fortunes you can make by doing so.  The reality is, at best, 10% of those who day trade actually make a profit and can survive on their earnings.  There are professional gamblers who make a nice living as well.  Day traders are no different.

If you can devote 15 hours a day to research and trading, and can spend your weekday sitting in front of your computer watching the markets, and have money you don’t mind taking a risk on losing, then by all means, give day trading a go. You can also save yourself a lot of time by taking your money, going to Las Vegas, putting all your money on red, and calling it a day.

I’m sure you’ve heard the phrase that slow and steady wins the race.  That’s what swing trading is in comparison to day trading.  Whereas day traders make multiple trades, in and out of one or more stocks, throughout the day, swing traders buy and sell but over the course of many days, weeks, even months. Day traders look for quick moves that they can profit on in a few minutes.  Swing traders look for trends that last for longer periods.  What that means is you don’t have to be sitting at your computer non-stop every single day.  Over the course of our posts, we’ll show you how to protect your trades so that you can lock in your profits, as well as limit your losses, without even having to be online.

In addition to the time needed, the minimum account size recommended for a day trader is $25,000, whereas a swing trader can participate with as little as $100. Granted, a day trader can make large profits in a single day, but they can lose large amounts as well. It’s all about risk and reward. If you’re an investor and less of a gambler, swing trading is the option to go with.