How to Avoid Day Trading
According to Investopedia, day trading, or scalping as it is occasionally known, is a highly speculative practice that involves holding trading positions for a very short time (from minutes to hours) and making numerous, even hundreds of trades each day. Most trades are entered and closed out the same day. Being highly speculative in nature, it is no wonder that the inherent risks are many. The reality is that most day traders lose money. Avoiding day trading, if need be, just requires general investment sense.
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Instructions
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Have a realistic yet sound long-term plan for your investing goals. To avoid day trading and its sometimes risky proposition, you will need a strong will to maintain your resolve, as well as a sensible idea of your profit targets. Trade for long-term value or profits as profits in trading often come from value investing for the long run. This helps you capitalize on larger swings and more volatility in the markets for better returns. This is known as position trading.
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Avoid day trading if you wish to, especially as an inexperienced trader, because there are times, especially in the morning, when the markets go wild. The middle of the day tends to be the most calm and stable period in which to trade for a less-experienced trader.
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Use swing trading to your advantage. Swing trading is a trading practice midway between day trading and position trading. It allows you to hold trades for the medium term (anywhere from several hours to a few weeks), and would be a suitable alternative to avoiding day trading entirely.
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Appreciate that no trading style is absolute or ultimate. Most traders will use a combination of the three trading styles (day, swing or position trading) until they find their optimal trading fit, often continually adjusting their methods as they go along. Avoid day trading if you must. However, the leverage can be very good, of up to 100:1. This allows you to speculate in the markets with up to a hundred times your capital outlay.
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References
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