Day trading is an approach where investors open and close numerous transactions in the course of a single day. In the beginning, day trading was a domain of big financial organisations because they had possibilities to use leverage. This way they were able to get the most out of one trading day. But nowadays, day trading is available also for individuals. Olymp Trade creates such opportunities. On the Olymp Trade platform, you can trade stocks using Fixed Time Trades, Forex mode or using Stock Price Trades.
The best stocks for day trading on Olymp Trade
There are many kinds of financial instruments you can choose from on the Olymp Trade platform. How to pick the right stock for day trading? You should take a few factors into consideration.
Trading is basically opening and closing transactions, yet, it can be done in various ways. Traders choose different instruments, charts, and they have different styles. It is essential to be in harmony with your own preferences. The only proper solution does not exist.
Think about what kind of trader you are. What is your strategy? How much money do you hold in the trading account and how much can you put on a single trade? Also, how much money you are prepared to lose.
Start your trading day at the opening of the market, so you will have more opportunities to trade. Try different stocks and observe your results. Keep a trading journal where you note all your actions. After some time, you can view your notes and pick the best stocks for yourself.
Volatility and liquidity
The volatility of the stocks is higher when the company issuing them is subject to larger movements in capital flows. The liquidity is greater together with the speed at which the instrument might be purchased or sold in the markets. More liquid stocks are characterised by bigger capitalization and more beneficial discounts.
More volatile and liquid stocks are usually better choices for day trading.
The volume gives information about interest in a particular stock. And it does not matter whether the interest is positive or negative. The assets that can be purchased and sold multiple times during a certain time period offer more opportunities.
Types of industries
Some types of industries may be better choices because of their liquidity, high volatility and trading volume. A very popular industry is social media. Likewise, Bank of America and other financial services enterprises might be a good option.
Remember that you do not have to pick the industries in your neighbourhood. Widen your search to the stock further from you geographically.
Traders have to think carefully about the strategy and risk management if they want to begin day trading. They need to know their own preferences. Try different kinds of stocks and observe how you perform trading them. It is recommended to focus on more volatile, liquid and high volume assets.
Whatever your choice is, test it in the Olymp Trade demo account. It is supplied with virtual cash that can be replenished any time you want. All the features that are in the real account are also available there. So go and see how you accomplish with a particular instrument. After some practice, you will be able to choose the right one for yourself and you will move to the real account.
Best of luck!
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