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STRATEGIES

  

Day Trade Strategies

 TRADING STRATEGIES

 


1. Day-Trade Strategies


Day trading means buying and selling a financial asset in the same day. Day-traders usually have the advantage of low commissions but they are exposed to significant market risks. Understanding technical analysis and been able to evaluate upcoming information is the key to day-trading success.


The Basics of Day-Trade


These are some key issues you must consider in day-trading:

1) Trading Cost (trading spreads, trading commissions, overnight rates)

2) Depth of the market (sufficient volume activity for easy enter / exit)

3) Significant volatility that may create trading opportunities in short-term


4 Common Day-Trade Strategies


1) Stop-Loss Day-Trade Strategy

2) Momentum Day-Trade Strategy

3) Scalping Day-Trade Strategy

4) Fading Day-Trade Strategy

 ► Learn more about Day-Trade Strategies

 

2. Twenty (20) Trading Tips


Four categories of Tips including:

1) General Trading Tips

2) Tips for Starters

3) Short-Term Trading Tips 

4) Stock Trading Tips

Read and Think about the 20 Trading Tips


 

 

 

3. Identifying Investment Risk


Two major categories and ten sources of investment risk are identified. High portfolio risk may adversely affect future cash-flows of an investment and even lead to a total loss of the initial investment. Capital investment risk is divided in two major categories: systematic risk and non-systematic risk.


(I) General Categories of Risk Separated by their Fundamental Nature


In order to deal with the investment risk first we must identify its origin. In that way we distinguish risk into two general categories: systematic and non-systematic risk. Systematic risk is unpredictable and therefore it can not be identified and managed. This category includes risk deriving from events of the overall macroeconomic environment. The worst case scenarios include war and nationalization of local companies by the force of state law.

In contrast, non-systematic risk can be anticipated through the implementation of a series of risk diversification techniques. The non-systematic risk can be mainly managed through a process called diversification of risk. The concept of that technique can be captured in the phrase "Do not put all your eggs in one basket".  


(II) 10 Special Categories of Risk and how they can be managed


Here are the 10 most important types of investment risk.

1. Business Risk

2. Market Risk

3. Credit Risk or Default Risk

4. Liquidity Risk

5. Interest Rate Risk

6. Financial Risk

7. Inflation Risk

8. Currency or Foreign Exchange Risk

9. Political Risk or Country Risk

10. Systemic Risk 

 Identifying Investment Risk

  

 

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