WHat is a day trader.. and what are the benefits?

By definition, "daytrading" means that you try to make money on daily price movements of stocks in the stock market every day. Whether you trade every minute or hour, daytrading is very short-term in duration. Some people trade for 1/8 and 1/4 points while others try to make money every one to five days.

Day Trading Benefits â€“ What are they?

Although previously considered to be the exclusive domain of floor traders only, day trading is now an option for anyone speculating on the market. With the advent of improved communication technology, affordable computers, the lure of large intra-day price swings and competitive commissions, day trading is gaining in popularity by leaps and bounds.
Day trading has often been vilified. There have been many pros who have openly condemned day trading. Even responsible institutions have at times raised serious doubts against day trading. But fact is, with real-time quotes available, improved computer technology, and next to nothing commission rates, day trading at his point of time makes ample sense.
There are definite benefits when it comes to day trading.
You donâ€™t have to be concerned about overnight news
This is a big plus with day trading. Since you are completing your trading within the span of a single day, it doesnâ€™t matter if something big happens overnight which you cant deal with the next morning when the markets already start in a bearish note. With day trade you know what you have made at the end of the day, whether you win or lose.
You donâ€™t run the risk of riding losses
Since you finish off with your trading within a day you may lose but you avoid losing more the next day as you donâ€™t hold on to your stocks. So if any stock of yours suffers significant losses over a few days you are not affected to a great extent.
You can capture large price swings
If you are into day trading it means you are always on the ball. So nothing that happens in the market escapes you. If any news or event results in large price swing of any particular stock you are there to capture it. A constant monitoring of the market is needed for this. You have to have the patience to wait for the event to happen. When the event nears you have to anticipate it through your analysis and instinct. And when it actually happens you have to grab the opportunity as quickly as possible.
You get instant feedback
With day trading you donâ€™t have to worry long as to what will happen to your money. You are buying and selling the same shares in a single day. So by the end of the day you know how much you have made that day. You may have made a profit or you may have lost. But whatever has happened the results are right there in front of you in the evening.
But, if you are thinking about being a serious day trader you should also be aware of the risks you are about to take.
You encounter significant intra-day volatility
At times stock prices suffer significant swings within a single day, but the swings generally get corrected over a period of time. Being a day trader you cant wait for the correction to take place and you may end up losing big time.
You need a sizeable investment
If you are seriously contemplating day trading you would be required to make a significant investment. You need to get yourself the best hardware around, the pretty expensive software platforms which are must-haves, you need to pay a sizeable amount to gain access to all the live quotes and news. So before you take the plunge, do some soul-searching and decide whether you are really that passionate about getting into this.

Day trading means buying and selling througout the day.

So you might buy 1,000 share of XYZ stock at 10:00 AM at $20 a share and sell it at 1:00 PM at $21.50 and pocket a $1,500 profit. It's generally a very short-term (i.e. speculative) trade.

Contrary to the first answer daytrading is not the same thing as short selling!

Instead of buying stocks for the long-haul, you buy and sell all day, moment by moment, following the trend of the hour. You can make money quickly, but you can lose it even faster. A good broker will tell you the most solid investment is to go for the long-term. Some people make this their 9-5 job, sitting in front of Bloomberg TV and on their day trading sites. Too much drama for me!

The benefits are largely to the company that does you're trading, they'll make a fortune off of you, and to Uncle Sam, who will smack the heck out of you with capital gains when the market is rising, but disallow your losses over $3k when the market declines. You, however, will not benefit, at least not in the long run. It's a lot like getting in the horse racing business, ever heard the line, "How do you end up a millionaire racing horces? Start as a billionaire."

It's a fool's game, another "get rich quick" scheme where the people getting rich are not the suckers, the day traders, but the people pushing the dream.

As they say, in a gold rush, you don't want to be the one panning for gold, you want to be the one selling shovels. Selling shovels you win either way. Here, Scott Trade or ETrade is the winner, and you're the sucker. You risk all the capital, and they make a guaranteed profit.

If you want to be rich, invest long term, be patient, and invest in a low cost fund manager like Vanguard.com.

trade stocks for income daily. benefit is you can live off it if you are good and don't need a job. problem is very few are good at it and you need to tie up all of your capital trading stocks. if you don't make money doing it, it is a miserable way to spend a day. you have little connection with people and you get isolated. the only thing that matters to you is making money. if you lose big one day, nothing else matters and you can't sleep. the next day could be even worse if you are on the wrong side of something...it can continue to decline and you continue to lose because you have gone from trading to hoping something comes back. the sad thing is that many times you are correct in your valuation work and where the stock price should be but you get shaken out of it with short term market fluctuations that go against you and you sell for a loss

also called short selling in the stock market the benefits are that you can gain a ton of money in a short amount of time but the risk's are great so you could also lose that money.

a day trader makes many small trades in a day to cherry pick stocks for pennies at a time "usually". The pennies a day x a bunch of shares can add up to $1000's per day. And usually a daytrader only needs to work a few hours a day, the first 1.5 hours at opening bell are the key.

take a look at http://www.daytradegaps.com for a good site on picks for morning cherry picking.

1) You buy Yahoo! in the morning and you sell Yahoo! in the afternoon.
2) You leave the office at 16:00 and you only work from Monday to Friday.

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