Stock Investing 101

Day trading seems to be a very desirable job, and for good reason. People think that you can sit around all day in your pajamas, follow a secret day trading “formula” and make thousands of dollars a day. While there are some gifted, knowledgeable people who make a living day trading, most who end up trying to day trade while being completely uninformed in up falling flat on their face.

Day trading for dummies: Here are the basics. Day trading is where someone attempts to make a profit in the stock market by rapidly buying and selling shares of a company or some other asset [An index fund, ETF, commodities, currency...].

Is day trading more like investing or gambling? Personally I think it is more like gambling. Investing is making a decision for the long haul. Investing is being okay with a down year or two and realizing over time your money will increase at a rate of 8-10% and compound interest will eventually do its wonders.

Gambling is making a calculated bet.  There  are a few people who play poker for a living but they are certainly in the minority. It is the same way with day trading.  A few will succeed but most are simply not cut out to do it.

If you are a day trading “dummy” do not sweat it, you are better off focusing your efforts into investing and personal finance.