What is Day Trading?

The Day Trading concept is a speculative investment system, which has many similarities with other investment models in which the investor makes purchases and sales of a certain financial instrument with the aim of obtaining benefits with the rise or fall of its price according to your forecasts.

Unlike other investment systems, in Day Trading the investor opens and closes the operation on the same day, so it is considered a short or very short-term proposal. There are even some Day Traders who keep their positions open for seconds or minutes, which is called scalping.

The investor seeks in Day Trading to operate in the financial markets in real time and purchase and sale options that fit within your investment plans. Once you detect a certain instrument that matches your plans, you will open a position and once you make a profit, you close it, regardless of the size of the profit. You can do this kind of operations with different investment instruments as many times as you want, but as long as they are open only one day.

Why invest in Day Trading?

There are several reasons to invest in Day Trading:

  • Day Traders choose to close their positions before the market closes, in order to avoid possible losses due to differences between the value at the close of the session compared to the opening the next day.
  • It is about obtaining benefits in the day, in the short term, instead of investing in the longer term, where the benefits that accumulate over a period of time may be diminished by future fluctuations or even disappear.
  • You avoid assuming the expense of the nightly premium that some online brokers usually charge for keeping positions open from one day to the next.

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