What Is a Professional Stock Trader?

Professional stock traders often live by their computers while the market is open. If they trade on other exchanges besides American ones, they may be there throughout the night. They make their living off the vacillations of different stocks. These individuals use various techniques to select the stocks they buy and sell.

Techniques

The stock trader uses a technical method, fundamentals or a combination of the two to predict prices.

Technical Method

The technical method uses the history of the stock's price to predict the future price. He charts the movement of the stock, then buys and sells according to various formations on the chart.

Fundamentals

The stock trader that uses fundamentals uses the information about the company's financial information, its place in the market with competitors, the management team, and the market for the product it sells.

Movement

Professional traders make money either when the stock moves in either direction. They make money in the down market with options and short sales.

Size

Most professional traders don't look for a huge profit daily. Instead, they seek a specific percentage.

Work Ethic

Most professional traders adhere to a strict work ethic that involves considerable time in the preparation to trade stocks. Research into the stock and learning new techniques is one of the things that separate the true professional from the rank amateur.

References

• Trader Feed