Saturday, December 13, 2008

Trading Forms

Scaling - is for extremely small durations. A dealer or jobber is essentially a scalper. He buys in this instant and sells in the next instant for even a one tick profit.

Day trading: Day traders do their trading within a day and go home without any outstanding trading positions. They may have some inventory of shares. But they are not trading positions. Strictly they may not have any inventory also.

Position trading: Position traders carry their trading positions for number of days.

Momentum trading: It identifies very short term trends and tries to trade in the direction of the trend

Swing trading: It extend from one to four days.

Trend trading: It identifies intermediate trends which may last up to three to four months. But identification takes time and hence average time of a position can be a month.