All You Need To Know About Active Trading

Being an active trader is one of the many ways you can make money in stock market trading. This is the process of buying and selling securities based on short-term movement in order to profit from the price movement. In contrast with buy-and-hold strategy, which is based on long term price movement, active traders believe that short-term price movements is where they can make profit. There are four styles of active trading.

Day Trading

As the name implies, this is style of active trading that involves buying and selling of security within the same day. This is often done by professional traders such as specialists or makers. However, the advent of electronic trading has made day trading possible for beginning traders.

Position Trading

This style of trading on the stock market is often considered as a form or buy-and-hold trading. A position trader uses longer term charts combined with other methods to determine the trend of the current market direction. Position trading may last from several weeks or longer, depending on the trend. In position trading, traders enter a trade after a trend has established itself. When the trend breaks, they will usually exit the position.

Swing Trading

Swing traders usually get into trading when the price is volatile as a new trend tries to establish itself. This type of trading usually lasts for more than a day but usually for a shorter time. In this style of stock market trading, the rules are usually based on technical or fundamental analysis. They are designed to identify when to buy and sell a security.


Scalping is one of the quickest strategies used in active trading. In this style of trading, scalpers try to hold their positions for a short period in order to decrease the risks associated with this strategy. Instead of taking advantage of large moves or move high volumes, they do the opposite. They prefer markets that are not prone to sudden price movements.

In active trading, it is possible to combine all these strategies. However, to be effective in stock market trading, you need to consider and explore the risks and costs associated with each strategy. Due to its lower commission and better execution, you can increase your profit potential.

To be successful in active trading, you need to practice and continuously hone your craft. Once perfected, you can look forward to maximizing your potential income.

Robert Peter Janitzek offers tips and guides on how to become successful in stock market trading. Check out his website at

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