Day Trading for a Beginner

[Axrose 10]

Hi,

 

I am beginner and decided to enter stock market to start with small cash , mainly in Europe like DAX and CAC40 as I have been seeing these companies grow since my 22 years of business experience

 

My main interest is in Day Trading where I enter in the morning with my cash and exit before the markets close, I dont beleive in Margin Call, I feel more comfortable with my own cash,

 

the idea is to jump into already climbing stock, and dump it even if the gains are small (or worst for small loss) by the end of the session, I will be happy if the gain are under a percent , steady growth is better then risking the hard earned money with greed for more

 

my understanding is that even though I will be quick to decide and trade the settlement will still take place in T+2 or T+3 that means my capital is stuck in previous trades,

 

so any suggestions where I am wrong, I am sure there are gonna be pitfalls every where, but I guess if I keep my eyes open and my nose clean I can mange to survive

[pipbanker 10]

I dont know what your method is, but DAX would be a pretty wild instrument to trade for a beginner. Not sure what you mean, but I am talking about FDAX, futures

[naveen1985 10]

what u have mentioned is actually just everyone wishes(taking the stock when its hot and running, take profit or book small loss ), it would be useful if you could elaborate ur strategy more...

[nagesh 10]

hi

 

it is a good decision to day trade, no overnight carrying positions tensions be quick to book profit all the best in your trading.

[Axrose 10]

With DAX I mean DAX listed companies, not the FDAX , normally these are the companies close to their core values and strong

[Axrose 10]

For Naveen, my strategy is pretty basic, I put my money in companies I know and as said before they must be strong, I dont go for Financial institutions where often hear "oops I did it again" or tech companies where things change faster then we change clothes

 

so in a nutshell I look for old but progressive companies, its not that these companies cant go down, but such occurrences are not very often

 

2 weeks ago I put together small virtual portfolio on Bloomberg app, I started by reading news and their fundamental, spread cash in 5 companies on their previous day close by the afternoon together they added up almost 2% in value, for me it was time to dump them

 

day after day I was doing it and every day my cash adding up between 1% to 1.7% until the news about euro zone starts coming in where I start to add over 3% the point where I dump the stocks

 

until last thursday where Euro leaders met and finalized 1.4 trillion support and stuck a deal with greek debt holders that day I added up nearly 6% on my selected companies

 

to cut the long story short I react and select the companies on news and I just sell my portfolio as soon as I feel that its time to get out , its purely a gut feeling

 

the only thing I need is to get in and out in a same day to avoid any after market and the next day opening surprises

 

I hope my strategies is clear now (its no rocket science)

[Axrose 10]

about the nagesh's comment: the problem I am foreseeing in this is the T+3 in US and I guess T+2 for FSE, I will be working on limited cash, and I dont plan to make margin call, since I will be selling at the end of the session I have to wait for days until my trade is settled

[naveen1985 10]

Have u tested ur methods for day trading by paper trading? I would suggest you to paper trade first and see what are the different scenarios possible and what steps u should take in each of them....

Stick to companies with good volume and volatility. i don't know how much important are fundamentals in day trading...

[Axrose 10]

Learnt a valuable lesson today, if we keep a close eye on nose diving charts as it was today, even then their is a money to be made, we have to make sure that company is in good shape and just taking a beating because of overall market sentiments.

 

We have to be very accurate to figure out where the bottom is and soon as it touches the bottom buy it

 

I guess their is an opportunity in companies that lost in region of 6% if they are in good shape

 

Please correct me if I am wrong

[Axrose 10]

I think I have overstated my strategy or my words have taken on on literal meanings,

Any way this is how I look at things:

a. I have made a small portfolio of companies that I know well, which have good industrial background, which have strong and healthy books

B. Which have good and already proving strategy in markets specially in Emerging markets which are main source of growth for companies these days

C.I am watching their market movements for weeks before putting real money behind them, I am seeing their lows and highs specially in todays volatile situation when news from Greece and Italy are clearly visible in charts

D. The companies I look at have price fluctuations because of market sentiments not because of that individual company's performance

 

The bottom and top are set on daily basis, I set my own bottom and top based on my own calculation and trend evaluation and to act when it's reached

 

The starting objective is not to make big money but my strategy is not to loose money