what is bad about day trading. i am a day trader and a beginer. what should i keep in mind when i day tradinf. i heard that i a have to pay aalot of tax or something like that.
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If you’re daytrading, then it can be riskier depending on the level of margin you’re utilising and the volatility of the stock you’re trading… personally I DayTrade and I have no issue with it, equally, if you’re doing it sucessfully as well, don’t worry and focus on what you see.
Tax-wise… that depends on what country you’re trading from and you should obviously discuss the matter with your local authority.
Day trading isn’t always bad. However, it’s a very risky means for investing for a beginner. It requires a lot of luck and usually your reasons for choosing to purchase stock don’t adequately reflect the market for a short period of time. Just be careful when day trading, you have to pay fees for every stock you buy, so you have to purchase enough stock to make a profit while considering the cost of just purchasing the stock. It’s always a good idea to invest in long term stocks as well, as their trends tend to rise over long periods of time.
When you “invest” in stocks, you are buying a share of a company. You are now an owner of the business. You expect to “share” in the profits of the company.
The company creates wealth generally by producing a product and selling it. They generate money. This is why there is an upward bias to stocks over the long term.
When you are trading, you are speculating. The money you make is not money generated from the company doing business, it made from the other traders.
You have to think that you have a better idea of what a stock is worth than the other traders think. You have to think you are better than they are.
It is like the difference between being General Motors or being a used car salesman.
But used car salemen have it easier because their competitors aren’t selling the exact same cars like stock traders compete over identical shares of stock.
Day trade requires a high risk and lot of money to make gains on the small increase of the stocks in a day. Well the IRS gets reports of all your trade transactions. After enough trades you need to file as a business trader because you will have to explain maybe a 1000s/ million dollars in tranactions recorded. If you are only trading then you must file taxes 1/4 and keep accounting records per GAAP and so on etc.
There is nothing wrong with day trading. With regards to taxes, what is taxable is income made in any fiscal year. If you made 1,000 dollars in one fiscal year trading, then that is what’s taxable. It would be best if you talked with an accountant about this.
Beginner should never do day trading. It’s too risky. You can try first with fundamental analysis, and technical analysis. WHen you are condident, you can then try day trading.
high risk, because you waste so much money for the commission feeshttp://dividend-growth.blogspot.com/