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Short Term Trading vs Day Trading

Short-term trading, also known as "swing trading," means holding a position (long or short) for only a few days or less. The difference between this and day trading online is as the name implies - that the position can be held for longer than a single session or day, unlike day trading where the trader goes 'flat' at the closing bell. Information is the key here- day trading information by necessity is more dense than the dataflow required to swing trade, as the reduced timescale means more granularity.

Short-term traders will hold a position for between 2 days and a week, and occassionally (if the trade is improving every day) trades can last a few weeks or perhaps even months. Strategies used in short term trading are generally similar to strategies used in day trading online, but a short term trader's profit targets (and therefore stop losses too) tend to be bigger. Leverage too tends to be smaller than in day trading, unless futures or options are involved, as a short term trader, unlike an online day trader, carries positions overnight, and extra margin may be required by the broker.

Short term trading with stocks via a 'spread betting' company is nowadays potentially more profitable than ever, as many of the spread betting companies effectively function 24 hours a day, meaning your protective stop losses (which in some cases can be 'guaranteed' stop losses!) can be triggered instantly, protecting you from sudden 'out of hours' high-impact events. The introduction of 'single stock futures' (which are also useful instruments when day trading online) has also added to the attraction, as leverage can be increased on individual securities, which can exhibit massively increased volatility compared to an index, for example.

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