Trading Strategies tagged posts

Strategies for Online Stock Trading

With the coming of the internet came all sorts of online activities. People do virtually everything online, whether it is shopping, learning, trading, and almost everything else. Online trading has gained popularity over the years with online trading companies cropping up day and night. This has made it easier for people to trade since they can do it from the comfort of their computers and smart devices, and hence there is an increase in trade. The minimum amounts to be invested in trades have also gone down, further making it more convenient. In this article, we are going to look at some strategies for online stock trading that people might want to consider before trading. Trading without strategy could cost you a lot of money in lost trades, but done the right way. People can make a lot of money. Below are the strategies that people can try using:

  • Day Trading
  • Momentum Trading
  • Swing Trading
  • CANSLIM Trading
  • Buy and Hold
  • Penny Stocks
  • Biotechs

Day Trading

Day trading is whereby securities are bought and sold on the same day. They come in many different ways that include:

  • Price Action Trading
  • Scalping
  • Rebate Trading
  • Arbitrage
  • Momentum Day Trading
  • Market Making
  • News Trading/Playing
  • Pattern Trading

Momentum Trading

Momentum trading identifies the momentum where the stock is trending and more than that. It emphasizes on stocks which show a strong move in particular directions, usually on high volume, within a specified time period. The biggest challenge is for traders to tell when to sell.

Swing Trading

Swing trading is trading that takes advantage of price swings during certain trends, and the trades can be kept for more than a day so as to maximize the gains as the trends pick momentum. The trader needs to research and the trade depends on their accuracy.

CANSLIM Trading

Created by William O’Neil, CANSLIM trading is a system for selecting stocks with each letter in the acronym standing for a key factor to look for in a company. It is probably the most well-known investment strategy that involves buying well performing companies with solid fundamentals on certain technical breakouts.

Buy and Hold

This is a passive investment strategy where a trader purchases stocks and holds onto them for a stretched period of time no matter the fluctuations in the market, short time price movements, and technical indicators.

Penny Stocks

These are stocks that were traded for less than $10 per share in the past, but today can be traded for $5 per share.

Biotechs

Biotechs are very risky, and they can either make or break a trader. There is a lot of strategy that is involved since it involves biotechnology products, some of which could fail to gain acceptance into the marketplace. Drugs go through a series of tests to determine effects and safety, and the result is what could determine the stock price of the biotechs. The stock price can also be affected by the FDA results.

Iron Condor Trade

Unlike other trades where you wither expect the prices of the stocks to either go up, or down, with iron condor trade you can make money of the trades don’t move at all. These sort of trades could take long to learn, but they are a great way to make consistent profits.

Summary

People are making real profits with online stock trading as long as they use the right strategies or right people to guide them. It is important to study the market and the particular trade strategy that you would like to use before you invest in it. Remember, it could either break you or make you.

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