Day Trading is Not All That (Part 1)

A couple years ago, I read an article by Louis Horkan Jr. on daytrading at About.com. I found the article interesting enough to cut and paste it as a blog idea, which I will present today.

He wrote:

> The allure of day trading is powerful to most people. Who isn’t drawn
> to the notion of trading stocks, crude oil or the Euro and making good
> money, setting your own schedule and working from anywhere you can
> establish an Internet connection, be it the beach, the gym, Starbucks
> or trading from home while lounging in shorts and flip flops?
>
> Sound almost too good to be true? That’s because it is too good to be
> true and the romantic or cool notions that people harbor about trading
> for a living are far afield of reality. While that sounds pessimistic,
> it is a harsh reality that must be dealt with up front.
>
> Truth is that for the vast majority of people, trading for a living
> (day trading) and dealing with trading risk makes absolutely no
> sense – they have no business doing so. It’s not about being smart
> enough or having nerves of steel to stare down some imaginary
> opponent or any of the other preconceived ideas that abound.
>
> No, the reality is that most people wouldn’t enjoy trading, nor
> would they ever start doing so daily if they understood what it was
> really all about. Yet most people who do decide to trade simply
> jump in before ever learning what is entailed or what it takes
> for success – let alone knowing whether they’d actually want to do
> this type of work.
>
> Such an approach is doomed to failure from the very start – much
> akin to starting a business you know nothing about, with a high
> degree of likelihood you’ll hate the actual work once you’re
> knee-deep in the endeavor. Most people would run from such a
> situation when put in that perspective.

Some further thoughts in my next post.