Stock trading requires a whole new language. Just like learning any new language, new terms, definitions and speaking are required to be effective at communicating.

Some of the key terms you’ll probably come across early in your trading career deal with timeframes.

Here are some common terms used to distinguish the timeframes people tend to trade…

Swing Trader
These traders leave transactions open for a few days or a few weeks, looking to take advantage of swings within the prices of certain securities. Swing traders tend to rely more heavily on technical analysis and have fewer traders than other trader types.

Day Trader
Someone is called a day trader when they complete regular, daily transactions within the investment markets. Day traders may make any where from a few transactions per day to several hundred transactions per day. Day traders often need to perform this function full time, as any important moves within the market or within specific securities needs to be capitalized on.

Buy and Hold Investing
Traditional investors place funds into a security or a mutual fund and hold for the long term, possibly making adjustments as needed once or twice per year to their entire portfolio.

How do you Decide Which Strategy to Implement?
Investors using each strategy will tell you that their specific strategy is the best one. The most important things to consider when implementing an investment strategy are your personal goals, your personal risk tolerance, your available capital to invest and your relative investment time frames.

Ray

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