![]() ![]() This is all the more true if you are not an experienced day trader and stocks start moving faster than normal. A single loss while trading on margin can be very expensive indeed. The downside is that there is also much more money to lose on any given trade. The upside is that this provides you with significant additional trading funds and therefore the possibility of making greater profits. This is because day trading typically involves trading with borrowed money called margin in the business. It is all too possible to fall into significant debt rapidly while day trading. Swing trading is a fantastic option for those investors and traders who are just learning how to trade and who simply can not commit their whole lives to doing so. Many swing traders do this on a part- time basis and keep regular full-time jobs in an unrelated field. It still requires monitoring positions for profit and loss, but there is no constant changing out of positions. ![]() With swing trading, the time frames involved are substantially longer, often lasting for a few days or even weeks. Many day traders are doing this for full time work, whether they work alone or as a member of a corporate institutional trading and investing team. It requires constant focus and concentration and often causes significant personal stresses. This makes the traders continuously monitor their positions for profit and loss points. Part of the reason is that day trading commonly involves trading in and out of positions in rapid succession (as in one minute, three minute, or fifteen minute intervals). Day traders must be willing to invest enormous time commitments to do it well, whereas swing trading does not require so much time. ![]()
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