Question by : Is swing trading a great notion?
I don’t have the $ 25,000 requirement to be an active trader but I have $ three,000 to open a brokerage account. I know that swing traders normally hold onto their positions longer than day traders. Would swing trading be a excellent idea to steer clear of be listed as a pattern day trader and stay away from the cost-free ride rule?
Answer by Eddie W
Answering this question is just as intriguing as answering if day trading a excellent thought. My query to you is that basic. You have invested $ three,000 in a stock, on the identical day, if you sell it, you could make $ 500. Would you take the cash? Exact same query for a wanted-to-be day trader, if you invest $ 3,000 in a stock, on the identical day, the stock goes down and you could recognize a loss of $ 500, would you hold on to that stock? As a swing trade, you could make much more or worst, you may well shed what ought to have been yours. As a day trader, you might lose deeper or recover your loss.
Each day trading or swing trading are very good suggestions. But you have to answer the question initial.
This is known as discipline and practice. Realizing what you are, your rules and stick to it.
What do you consider? Answer below!