How can I become a profitable stock day-trader, and which out of spread betting or CFD’s is the best………?
I am just wondering, I invested into the stock market for the first time today and bought 1,400 shares of two different penny stock companies listed on AIM that look promising.
I am a UK based investor and I am just wondering, besides investing into potential, promising penny stocks for the long haul so they grow, how could I become a stock day-trader and be profitable at it?
What financial instrument would be best to go about this as I have a choice of either:
1) Trading the actual underlying stocks?
2) Using CFD’s (contracts for differences) which mock the underlying shares and allow you to go long or short on the market?
3) By using spread betting to day-trade stocks which is similar to CFD’s but its tax free?
Which option is best in your opinion if I want to stand a chance of becoming a successful stock day-trader, and why? Please help/advise. Thanks.
So let me understand this right – you are a first-time investor and bought your first investment into 1,400 share of two penny stocks!? Penny stocks are inherently very risky and while it is okay to punt some money on them you really need to put the bulk of your capital in more liquid shares.
You need to look into shares that make up an index such as the FTSE 100 – these stocks tend to be highly liquid and very much tradable.
If you are new to the stock market it makes sense to start trading the actual stocks for a year or two especially if you have a sizable pot (10k + to invest) Whether you use spread betting or CFDs depends on your location – if u’re in England go for spread betting, otherwise go with CFDs.
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