Traders use a variety of methods to conduct their business. The trading style classification can be achieved using measures like the products traded, Guest Posting purchasing and selling intervals as well as methods/schemes for trading. Stock, option, currency, commodity, and futures trades all fall under the category of major trading styles. Stock trading Forex Time involves buying and selling shares on a specific stock market. Option trading involves trading the options which are rights to buy or sale a specific share/contract within a specified time period and at certain levels of market.
Trading currencies online in pairs is what forex trading involves. That means that you are buying one currency, and then selling it according to fluctuations of the currency exchange rate. Online commodities trading and futures trading are based on contracts. These can be for goods like crude oil or natural gas, as well as money investments like bonds. Online trading can be classified into short-term and long-term trading based on the amount of time that passes between the purchasing and selling of a product. Trades which have an interval between the purchase and sale of products below one-year are usually called short-term, and trades with gaps over one-year are known as long-term investment.
Short-term traders make up the majority of traders online. These traders buy and sell stocks/contracts according to changes in price over a short period. The long-term traders follow the rate of growth in companies/industries. They trade with large volumes and long-term goals. Trading short term can be classified into swing trading, day trading and positions trading. Day trading has been regarded as one of the most active styles of trading. In Day trading, buying and sales are limited to one single day. Day traders trade stocks/contracts quickly, within minutes, hours or seconds for small gains. Trading day trades eliminates overnight risks, as traders do not own any stocks or options.
Day traders can be divided into two categories: (1) Scalpers (traders who are able to buy and then sell many contracts/shares within seconds) and (2) Momentum Trades (traders who react quickly and based their trades on trend patterns). Day trading and online swing trading are both active processes. However, here the time period for buying and/or selling can vary from just a couple of hours to up to 4 days. Swing trader’s use contracts and options to profit from minor changes in prices. Swing trades include overnight stock/contract risks. With position trading, the gap between buying and sales can be anywhere from a couple of days to even weeks. Online traders who trade positionally rely on longer-term trends, company/industry performance. Swing traders and day-traders have lower risks, but higher gains per share. On the basis of the trading strategies, the trading styles can be divided as follows: 1) Brother-inlaw Style of Trading – following the advice of brokers or traders. 2) Technical trading style – trading using advanced systems in order to discover historical and current trends. (3) Economist Style of Trading – trading according economic predictions.