Originally Posted by worldsend212
Hello everyone, so i have a question about day trading.
I have been keeping a record trades that i would do on a peice of paper. One that i wrote down was CMIN and i bought it at $1.05 and sold it at $1.19. I bought 10,000 shares. It yielded a $1400 profit without fees taken out.
Now to my question is say i am day trading and a stock like CMIN which i bought for $1.05 went down to $0.95 in a day and i didnt end up selling it because it didnt go over my original price. Now what i was thinking is that i would wait another day to see if it would go up and if it did i would sell it.
Thinking like this i think i could minimize a lot of loses that could be made. Do you guys see any flaws in this plan because to me i think i would lose hardly any money at all if i played my cards like this.
What do you think...
Exactly. If you sell you lock in a loss. Some traders follow that on trades they believe will work. Other traders put stops on to also limit their loss, while they will lock in a loss, they avoid a bigger unrealized loss. These stops are put on positions that are small, so the loss isnt that big.
But remember, stocks do not always have to go up. So choose your stocks carefully and make sure you understand your investing time frame. if you feel this investment will take a long time do playout (ie this store is introducing this new product), dont be concerned about day to day moves. I couldnt tell you what prices my long positions are trading at right now