Black Caesar's Guide To Trading Thread

Well, I think it's time for a Day Trading thread. I know there are some people that post or lurk in the Strictly Business that's probably fascinated about day trading. (I'm one of them.) It needs to be understood, that it takes disciple to be one hell of a trader, not to say that value investing doesn't take discipline and research. It just takes a different type of discipline. I'm by no means an expert, but I've been reading on it since 2009. So if there are people that know more, feel free to post. Learning never stops.

Some people don't believe in trading and likes to play it safe to protect themselves from a price change. (This is also known as hedging.) I see nothing wrong with investing at all. As a matter a fact, I feel investing should be a priority for everyone. You need to understand that if you plan on trading, and you are making unbelievable returns, you really need to take some of those profits, and invest (which means hanging on a stock, EFT, etc) for years or maybe a decade. The trick is to make smart investments to create a new lifestyle for yourself and your love ones and maintain that lifestyle. As Sion and Jay-Z said, "? being rich, let's get wealthy". Truer words were never spoken. "Sion's thread to Investing covers a lot, and I've learned a lot from that thread, and learn something new every time. Be sure to read it. It is essential to your financial future.

Understanding the types of trading

Let me start off by stating that if you have an understanding of investing. most of those lessons will be applied here, however it's worth stating that there are different types of trading.

What is trading? Trading is speculation, not to be confused with gambling. Gambling is when a person is betting with the hopes of luck in a random occurrence to be paid off. I play poker, and even I don't do that ? . I'm an advantage player. In poker, an advantage player, calculates the odds, the number of outs (cards needed to have a winning hands) knows when to commit to his hand, etc because there was research and planning, therefor putting money in with the best chance to gain a profit. Trading is no different, because you'll be doing research, doing technical analysis (we'll get into that later) and watching the markets and news to profit from a price change. In fact, get used to checking the news and watching live streaming stocks daily. From personal experience, I've seen traders use Sunday as a day to prepare for Monday morning. I met a brother in Starbucks who did this. Hell he even did his trading in Starbucks. I still see him in there. lol

Day Trading - Day traders do not hold their securities for more than a day. They close their positions ("cash out" in poker terms) and start all over again the next day. By starting over, I mean starting with other plans that you've created.

Swing Trading - This is when a person holds their position for a few days several days.

Position Trading - This is where a trader holds his position for several weeks to several months. The person is attached to short term price opportunities, but believes he/she can maximize is earnings holding out long enough.

Investing - This is not trading. You're hanging on to your stocks, ETF's etc for the long term. Long term is over a year to a decade.

What does day, swing, and position trading have in common? There all being taxed at the capital gains rate. (Uncle Sam stays winning) To get a tax break, you have to hold on to your investments for exactly one year and one day. Traders don't do this, so their being taxed at the ordinary income rate. I'm still learning this myself.

You know I'm all about dropping links. Here's are the books I started with when it comes to Trading:

Trading For Dummies:

http://lumfile.com/1te0txfyqz5n/Trading.For.Dummies.2nd.Edition.by.Michael.Griffis.Lita.Epstein.MBA.pdf.html

Day Trading For Dummies:


I think I'll go into picking which ECN you want to deal with next.