So you ate some kind of day trader?
Or a Warren Buffett wannabe?
Most Americans buy stock as an investment, not to make quick buck
Oh and by the way, I am no "wannabe" anything. I am 79 years old and my only goal is to pay my bills and have "some" extra money to give my wife pleasure (trips, gifts, good living conditions, and peace of mind of economic safety if I die before she dies).
As far as being a trader instead of an investor, the reality is that if you are a GOOD trader, you can make more money than an investor and live more in peace as you are never risking big money losses. In simple words, I never go through a 20% decrease in my portfolio (as investors saw here in April).
First of all, I diversify into at least 6 different industries and never get into a trade that has any less than a 4-1 risk/reward ratio, meaning I can be wrong 75% of the time and still break even. That brings me more opportunities than an investor (who usually stays with the stocks he bought and nothing else) and it also brings me peace of mind as I control my risk of the portfolio well.
In addition and by using charts, it also gives me security as computers and algorithms "automatically" buy and sell at support and resistance levels, meaning that I am not the only one buying or selling at those levels. I am supported by big money traders.
I do want to give you an example. I bought 1 stock at 21.50 and one year later it was at 28.50. An investor would be up 30% on the stock (decent return for 1-year). During that year, I traded the stock 18 times, shorting it 11 times and buying it 7 times. I had 10 losing trades and 8 winning trades and ended up making 5 times more profit (after losses were subtracted) than the investor.
Having said all of that, the key to trading is to be "good at it (knowledgeable)". I paid a heavy price to learn but once I learned, I have been successful consistently during 18 years doing it.
