Day Trading Futures
Day trading futures means, you are buying and selling every futures contract within one day. There are no open positions held over night. Since day trading requires a lot of knowledge in trading as it is, and day trading futures even more, this is nothing that can be recommended to newcomers.
One of the direct advantages of selling and buying during one day is that no day trader has to sleep bad because they worry about their positions. They already know the result of the passed day. The problem with futures is that they will often open with a completely different price than they closed with the day before. This may lead to severe losses while holding a position over night.
A normal day trader make a couple of trades during one day. This should be compared to a “normal” trader, that might be doing about one trade every week. Due to the higher tempo when day trading, the day trader is also going to learn more about trading or getting more trading experience since he is doing it more than a normal trader.
The hardest part about day trading is that you have to be very disciplined to succeed. It is very easy to overtrade. The commission is another problem, the commission is calculated per trade and since a day trader do quite a lot of trades during a day, the commission is going to be high. Many day traders have been shaken through the extremely high commissions they had to pay. They were happy that they reached break even at the end of the year and when the commission had to be paid, they suddenly realize they are actually losing money.
It is a fact that the most day traders don’t make it. They start enthusiastically, but unprepared. This leads to bad decisions at the start and this leads directly to losses. It doesn’t take long before they have lost everything they own.
Therefore, it is very important to have a strategy when starting day trading futures. And you have to be disciplined. Otherwise you will have no chance on this highly competitive market.
To learn about day trading you could start doing it on normal stocks. Try to find a few good stocks to buy now and learn as much as you can. Day trading for a living is a very hard thing to succeed with.
You could also try the forex market, if you do some research you will probably find out about the forex trading secrets and if you are clever you can use them to your advantage.
More reading:
- Forex trading secrets
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