Stocks Day Trading VS Investing (is Day Trading More Risky than Investing)

A day trader buys and sells stocks within the time frame of one trading day.

An investor generally buys stocks with the intention of holding them for weeks months or even years.

So this raises the question, is day trading more risky than investing…?

 

Most of the risk when trading stocks whether day trading or investing comes from the possibility of LARGE PRICE FLUCTUATIONS.

Resulting from an unexpected event, or unforeseen news alerts, these also include financial and political crises, market announcements, bulletins, sector information, analysis recommendation, and rumors.

Because NO ONE CAN ANTICIPATE entirely the timing or impact of such events.

The best way to reduce risk is to reduce market time exposure.

Statistics show that you can expect at least three market crashes during your own lifetime.

During such crashes market fluctuation and trade volume increase.

If you’re a swing or long term investor who holds stocks for weeks, months, or even years, there is a reasonable chance that you will lose a sizable portion of your portfolio during such events.

THAT’S ONE OF THE GREATEST RISK FOR INVESTOR.

But faced with these same conditions an experienced day trader can flourish because day traders exit their transactions during the day trade.

And unlike the general public day traders know how to perform drops in the market by shorting.

In summary HOLDING STOCKS MEANS TAKING RISK.

Any experienced day trader commission less risk than an investor because of their reduced exposure to the market.