4 Things To Know About Day Trading
More and more people these days are tempted by the idea of working from home, and for a lot of those people, day trading may seem like an appealing option. While there are countless professions that you can be attached to while working at home (or anywhere else remotely), day trading is one of the well-known options that first comes to mind for many of us. And with the work-from-home trend continuing to intensify and financial markets having somewhat stabilized after several turbulent years, that could lead a lot of people toward considering this line of work.
So, what do you need to know before you get into it? Here are a few things to consider.
1. You Need Equipment
A lot of work-from-home jobs can be done with a single laptop or tablet. With this hardware you can to start a website, sell goods and services, take up freelance writing or graphic design, or get started with any number of other potential professions. Day trading, however, is different. You need the right tools and equipment to gain an edge, and this tends to include a powerful computer, multiple monitors, reliable WiFi, and the latest trading software. And that’s just the beginning. Some busy day traders will also find that they function more effectively if they take steps to create a peaceful or relaxing office environment, which could mean anything from a new chair and desk setup to a bluetooth speaker and music subscription service. Ultimately, you’ll need to make yourself comfortable and equip yourself for a fast and reliable trading process.
2. The Hours Are Demanding
Strictly speaking, the stock market is open during a time span that’s significantly narrower than that of the average “nine-to-five” workday. In the U.S., the market opens at 9:30 and closes at 4:00, which means you may look at it and assume you’re signing up for a six and-a-half hour workday. That’s not actually the case. Live trading can be consuming on many different levels and requires both pre- and post-market analysis. Often, it also requires nearly unblinking concentration during that 9:30 to 4:00 span. Many day traders ultimately find that there’s so much work on either side of market hours, and so little opportunity to take breaks while the market is open, that the hours are ultimately more demanding than those of a more conventional job. Now, to be fair, some believe those hours are offset by the convenience of being at home the whole time.
3. It Can Consume You
This one’s a little more straightforward, and it’s something that will only apply to some individuals. But as we expressed before in a post about day trading, there’s always a possibility that the inability to switch off could wreak havoc on your home life. Sure, that’s a slightly dramatic way of putting it, but the truth is that the stock market is a very fluid and stressful environment and some day traders find that it’s hard to step away from work. Even after market hours you may find yourself wondering what’s happening with your stocks, checking the futures for the following day, or looking into relevant news to try to predict the near future. It can be all-consuming, which some may thrive on but others may want to avoid.
4. You May Have A Knack For It
“There seems to be a perverse human characteristic that makes easy things difficult.” That’s a line from legendary investor Warren Buffet that was featured as part of a list of inspiring quotes about markets and investing. They’re wise words, but they also underline a rather incredible point: Warren Buffet thinks investing should be easy. Not everybody feels this way, and indeed some can study the markets and practice investing for years without ever really feeling like they fully understand what they’re doing. Others find that they have a more natural knack for it. In this regard, investing is like any other skill or profession. But it’s worth keeping in mind that if it’s something that interests you, you could end up having a talent for it—you don’t know until you try.