A lot has happened in the world since the first version of Day Trading For Dummies came out. Mobile apps, tax law changes, and an entirely new asset class — cryptocurrency— have changed the work of day trading. There have also been changes in global politics and economics that have created increased volatility, and traders love volatility. Savvy people looking for success in day trading need an up-to-the-minute reference like this new edition to steer them straight.
Day trading is a business in which you use real money to take on the markets. If you love the thrill of the markets and have the patience to sit and stare at a screen for hours, waiting for the right moment to get in and get out of securities, then day trading may be a great career option. But it has risks, too. Any day can be your best day, but it can also put you out of business forever. For that reason, day trading requires the right psychological makeup. Good day traders are patient and decisive, confident but not arrogant. They most certainly are not gamblers, although day trading attracts gamblers who discover it’s a great way to lose money from home.
Day Trading For Dummies, 4th Edition, is for people who are looking for a new business or who simply want to supplement their investment returns with new techniques. In this book you can find all the information you need to determine whether you’re cut out for day trading, to lay out your home office, to research and plan trades, and more. (And even if you decide day trading isn’t for you, you can still find lots of sound general advice about markets, trading, and investing strategies that you can benefit from. Plus you’ll have saved all the money you would have otherwise invested on research and training, not to mention the trading losses!)
A lot of people make a lot of money selling services to neophyte day traders, claiming to be the best thing going. And maybe so — for some people. In this book, I give a wider perspective. Instead of telling you to use a particular trading strategy, for example, I help you research and evaluate the different day trading methods available so that you can find one that works for you. And I also tell you up front that if you decide to day trade, this book shouldn’t be your only guide.
First, let me tell you what this book is not: It’s not a textbook, and it’s not a handbook for professional investors. Several of those are on the market already, and they’re fabulous, but they’re often dry and assume you already have a lot of knowledge about day trading.
This book doesn’t make those assumptions. It contains straightforward explanations of how day trading works, how to get started, what the pitfalls are, and what some of the alternatives are for your portfolio and for your career. It’s designed for you to be able to skip around and read the chapters or sections that interest you, without having to read every word that comes before them. This book has more than enough content to get you started — or to guide you to something that’s a better fit for your sensibilities. If you really want to read some textbooks, I list a few in the appendix.
Oh, and I like to think this book isn’t dry, either.
During printing of this book, some of the web addresses may have broken across two lines of text. If you come across such an address, rest assured that I haven’t put in any extra characters (such as hyphens) to indicate the break. When using a broken web address, type in exactly what you see on the page, pretending that the line break doesn’t exist.
In writing this book, I made some assumptions about you, the reader.
As you read this book, you’ll see icons scattered around the margins of the text. Each icon points out a certain type of information, most of which you should know or may find interesting about day trading. They go as follows:
Well, open up the book and get going! If you have a particular area of interest, use the index and table of contents to go to the topic you want. If you’re not sure, you can either turn the page and start at the beginning or flip through and see whether a topic catches your eye.
Need more guidance than that? Then allow me to give you some ideas. You may want to start with Chapters 1 and 2 if you know nothing about day trading. If you need to get set up to start trading, look at Chapters 14 and 15. If you want to know some different ways to trade, turn to Chapters 5, 6, 8, and 9. If you want to learn the key to better trading, Chapter 7 covers trade planning. For ideas about developing strategies, whether you’re going to hold for a few minutes or several years, go to Part 2.
In addition to the book content, you can find a free online Cheat Sheet that includes information on accounts, definitions, indicators, and performance calculation. Go to www.dummies.com
and search for “day trading” to access this handy reference material; you can print it and keep it by your side as you get started.
Bottom line: Anywhere you go, you’ll find interesting and useful information.