When it comes to stock trading, there are a lot of investors
usually involved in this type of business. With many different trading
strategies available, different investors will also prefer using different
approaches when trading.

Currently, there are two commonly preferred trading styles,
day trading and long term or positional trading which usually involves holding
your stock for a long period of time.

However, most traders seem to be in love with intra-day
trading and below might be some of the reasons why. See more information on day
trading here

No Stressful nights

Personally, I think this is the
main advantage of day trading, it has no overnight risk. You can be able to
close your position even before the trading day ends. This way, you will be
safe since you cannot be affected by anything that might happen at night when
there’s no trade going on.

This always gives the positional trader a bit of headache as any bad news in the market can result to your profits disappearing just like that. But as for those practicing day trading, you will have nothing to worry about as nothing will affect your profit for that day, not even an overnight tragedy in the local markets.

Profit flexibility

Well, people join stock trading to
make profits, right? However, it is only those who practice day trading can be
able to make it in any way the market goes.

In other words, they can be able to
profit from either a rising or falling market. This is usually not possible for
the positional traders or the long-term investors who are waiting to make their
profit from a bull run.

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For the day traders, you can always
engage in short selling thus making some profit from the falling stocks. On the
other hand, the long-term investors will only be able to practice short selling
but only in those futures that requires a high margin. Click here to see how day traders usually
go about their business.

Increased leverage

If you want a trading style that
will require low margins but provides a great leverage on what you invested,
that would be day trading.

A lot of brokers will usually
provide up to a hundred percent leverage on this. What this means is that you
can be able to trade even if you have a less amount in your account depending
on the broker you are working with.

Well, with an increased leverage,
you can certainly increase your profits too. This benefit cannot be enjoyed by
positional investors as they need to have huge capital in order to make a good

High Returns

If you look at those who have been
practicing day trading and implementing it with great discipline, you will
notice that they have a good profit trend. If you want to make high profits in
day trading, you will have to understand and learn how you can be able to
handle any fluctuations in the market. This way, you will always know what to
do at what time.

Low broker commission

For the day traders, they usually
pay low brokerage commission compared to that of taking the stock delivery. The
other charges like stamp, stock transaction tax and service tax among others
are always applied when using a brokerage.

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This is why the commissions are low
for the day traders compared to their positional counterparts. Taking stock
delivery usually involves some extra process of stock transfer to your demat
account from the company.

This is what usually causes an
increase in what you are going to be charged through brokerage. Day traders are
able to trade with a huge amount but will pay less commission thus benefiting
more compared to the long-term traders.

You have some cash always

With this trading approach, you
will always have some cash with you. It is that simple, you start your day with
some cash and at the end of the day you will also have some cash.

This way, you will be able to have
a goodnight sleep with nothing to worry your mind. I mean, it’s always a nice
feeling going to sleep with fat pockets, right? Additionally, with day trading, you can be able to withdraw
your money at any given time in case of an emergency. Unfortunately, for the
positional investors, you will need to first sell the stock then cash it later.

About The Author


Hi! I’m Vipul, a professional blogger and online advertiser based out in New Delhi, India. Always in a quest for new ways to make money, I detail out all possible opportunities that can help anyone to earn good bucks. You can connect with me on Twitter, Linkedin & Facebook