No investment or trading strategy can make you rich overnight. If you think so you better go to Casino and take your chance and it’s highly likely you will end your capital fast way with gambling.
What you can do the best is to make better returns than others and stay in the game but that won’t happen fast as first you will learn then apply and practice everything with discipline and a time comes when your nerves will turn to steal and you won’t panic with market volatility anymore but you simply turn your head down and follow your master plan and stick to it. A steady return from 20% to 30 % annual will be an awesome achievement if you accomplish that in the due course of time.
Let’s see few common ways of investment and trading styles you would consider for yourself.
A scalper may trades hundreds of trades for small gains over a trading session, while day trader may trade a dozen and ensures that he would hold no overnight exposure at the close of the day only to start fresh next morning. While a swing trader may hold his position up to few days or even a week or more and may rely on fundamental analysis to pick few stocks but mainly follows charts and technical analysis for timing entries and exits. He may look for short or long position depending on the market.
On the other hand if you like buy and hold strategy then you does not care if market goes against you at present since you buy the stocks with a longer term perspective and you will believe in your research and valuation and won’t listen much to market noise or rumors.
Unlike day traders, swing traders hold positions over several days and sometimes for a few weeks. But similar to day traders, swing traders rely heavily on signals from chart patterns and technical indicators to time their entries and
exits from securities. They will enter when their entry criteria is met and will exit with profit or with a stop loss triggered in case trade goes against the plan.
Similarly you may like trend trading who may continue to ride with the trend, and do not end their trade at the end of a swing.
I personally like swing trading for my trading style and like me everybody needs to figure out about his trading style compatible with his trading psychology and personality. Unless he doesn’t he won’t succeed in the long term.
For example as a swing trader one may follow momentum trading strategy that would mean when a stock has caught momentum while its price starts to move in one direction followed by the trading volume then, a momentum trader will enter and continue with the wave unless it slows down ends or shift to other side.
Another person who may not like indicators the most may prefer price action strategy that means he will watch the market with price action primarily and do not rely on lagging indicators.
Yet another trader may be fond of mean reversion style and that trader looks for price that has moved away significantly from its mean (average) price; the mean reversion trader looks for unsustainable trends.
So you see there are many trade styles you may choose, no styles is right or wrong. But not every style suits to all persons equally. It’s the personal choice and decision and result can be profitable if you know your personality and psychology before you may choose one of them.