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The Daily Dose: Questions For Stock Traders

What’s the Difference Between Day Trading and Swing Trading?

By June 3, 2016February 25th, 2021No Comments

Day Trading vs. Swing Trading:

There can certainly be some overlap between day and swing trading, but for the most part, swing traders aim to enter and exit positions over a longer timespan. Day traders are trigger-happy, looking to enter and exit multiple positions within the same day. Their goal is to scalp just a few cents per share and “button up” their trades by the end of the day in order to reduce overnight risk. Day trading not only requires a high-degree of technical trading knowledge and experience, but mindset/psychology is just as important.

Swing trading is a bit more slow-paced, attempting to capture profits between 1-4 days. Much of the technical analysis concepts used in day trading apply to swing trading as well, with a minimal focus on fundamentals. Swing traders aren’t overly concerned with income statements or balance sheets, but rather the momentum provided by some sort of short-term catalysts. The major advantage of swing trading is that many individuals are able to implement a successful strategy in addition to working full-time. Busy professionals will find it rather difficult to find the availability to day trade, but can potentially handle the account management involved with 1-4 day holds. Longer time frames and higher-flexibility entries and exits tend to be much more conducive to the lifestyle of the average working professional.

Related Post: What is a Day Trading System? Establish Structure in Your Approach

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