NASDAQ Day Trading: Advice for Beginners

NASDAQ day trading is an investment choice that can provide you with a way to make steady profits as an investor. The term NASDAQ stands for National Association of Securities Dealers Automated Quotation. This is a type of automated stock exchange that allows traders to immediately have orders filled. In contrast, if you trade on the New York Stock Exchange, your orders will go to the floor of the exchange and be matched up with the assistance of a floor trader. This system allows orders to be filled very quickly and you can trade 5000 of the most popular over-the-counter stocks available. If you are just getting started trading the NASDAQ, there are several things that you will need to keep in mind. Here are a few pointers for beginners when starting to trade the NASDAQ.

Become Familiar

If you are thinking about getting started day trading the NASDAQ, you should first familiarize yourself with the system. It is critically important for you to be completely comfortable with the system before actually trading. You do not want to get in the middle of a trade and then not know how to complete it. Trading without being familiar with the trading platform could be a recipe for disaster.

Start Small

Many people who get started in this type of trading feel obligated to risk a large amount of money from the beginning. However, this is not necessarily the best route to take. You should only risk a small amount of money at first until you can get used to the market and learn the intricacies of it. This will allow you to risk small amounts of money on your new trading strategy until you know that it works. 

Research

It is also important to remember that you need to conduct a thorough amount of research on the stocks that you plan to buy. When purchasing stock in a company, you need to base your purchasing decision on more than a hunch. Your broker should provide you with the tools for your research with. Be careful though, do not get caught up in the habit of listening to financial analysts. Many traders will base the majority of their decisions on what the financial analysts on TV and radio have to say. In most cases, they will not accurately predict what will happen with a stock and you will end up losing money. 

Don't Be Overwhelmed

When you are getting started in the stock market, you may feel a bit overwhelmed because you are looking at too many things at once. Many traders get in the habit of trying to keep track of hundreds of different stocks. Instead of doing this, narrow down your investment choices and look for a few profitable stocks to work with. This is the best way to manage your money and your time.

blog comments powered by Disqus
Scottrade