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Strategies & Market Trends : Analysis Class for Beginners

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To: Arthur Tang who wrote (679)12/23/1997 8:24:00 AM
From: Arthur Tang  Read Replies (1) of 1471
 
Day trading and market makers?

When you first get into stock investment, you think that you can make money if you jump into a good stock and make lots of money. Then one day, you found you make good money just trade in the same day. People get hooked by the gambling aspect of investment.

Then you hear that technical analysis can give you the entry and exit points to scalp the market makers. People practice on paper investing(no real money). Everything could work fine until you use real money; because without real money, your mind forgives the discrepency in accounting.

Daytrading has the advantages of settlement in the same day. If you make 1% profit, you can theoretically make 365% minus the holidays and weekends. In reality, if you go in or out of index funds and money market funds, playing roullette black or red; some people reported 36% gain per year. Stock daytrading can be the same, but the odds are always against you. A run of hot hand, is seldom. Because the price of stock changes by the quotes or offers of market makers. If you can win against bookies, you will do well with market makers. Market makers' business is to balance the buy with the sell; they earn the spread. They do not invest in the stocks they handle.
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