happens is most people buy the top and finally sell at the bottom taking large losses. Which Offers Higher Potential Returns? One trading style isn't better than another and it really comes down to which style suits a trader's personal circumstances. Alternatively, global markets also tend to be active (especially currencies and European stocks) near the European open. Watching each little price movement can easily seduce a trader into making a trade when they shouldn't. Notice how the stock bounces around from peak to valley.
These are buy-and-hold trades, rather than quick, buy-and-sell-trades. Assume that your broker charges a commission of 7 per trade. A Final Comparison One trading style isn't better than the other; they just suit differing needs. Compounding occurs daily since profits are locked in daily. Just went you thought is was safe for buy and hold investing the 2007 financial crises hit and the markets got slammed by another 50 loss. Skills and Optimal Personality Traits, any type of securities trading requires a serious time commitment up front to research and create a strategy that works. While you still have to watch your stocks to ensure key levels are not breached, you do not have to hawk the tape like a mad man. Depending on how you opt to invest, the required starting capital varies.
Pros and Cons of Day Trading Versus Swing Trading Long Term Investing - Trading Stocks Buy and Hold: Which Is Better?