Recession/inflation...TRADING???

This is a discussion on Recession/inflation...TRADING??? within the General Trading Chat forums, part of the T2W Archive category; I am looking to go into Day Trading fulltime. Please advice if it is ok to start a career in ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Sep 5, 2008, 2:21pm   #1
Joined Aug 2008
Exclamation Recession/inflation...TRADING???

I am looking to go into Day Trading fulltime. Please advice if it is ok to start a career in trading when the country (UK) is in recession, economic downturn, stockmarket crash etc etc. People say that you can make money no matter what the economic situation is, is that right? But, I guess, that there will still be a time period when it is beneficially to venture into the world of trading stocks/futures/options etc. Please advice.
imranmir1 is offline   Reply With Quote
Old Sep 5, 2008, 2:50pm   #2
Joined Dec 2004
In general terms the markets are the markets and will always be there presenting opportunity for profit (and loss) regardless of the economic situation.

That said, particular trading styles will work better in certain environments than others.
__________________
John Forman
Author - Trading FAQs, The Essentials of Trading
Rhody Trader is offline Training literature vendor (e.g courses / spreadbetting guides / eBooks)   Reply With Quote
Old Sep 5, 2008, 2:52pm   #3
Joined Feb 2008
im only a newbie, but from what I understand the ey to making money is market volatility. even in a downturn this presents opportunities. Is this correct?
steveborner is offline   Reply With Quote
Old Sep 5, 2008, 3:10pm   #4
Joined Feb 2002
Volatility is indeed the key to making money as a trader, not direction - as we are not investors, we aim to make money whether the trend is up or down.

But there are reasons to be more cautious shorting than going long -
falling markets often subject to low volumes and wild fluctuations against the prevailing downtrend, so always use a stop-loss:
a falling price can only fall to zero, so your maximum profits are finite, whereas your potential losses are infinite as there is not upper limit to a price:
falling share prices often attract a take-over bid, and this can sky-rocket the price overnight - unlike results announcements, such activity is not going to appear in any business calendar for the year:
in a general recession, the turnover of your service provider (stockbroker, spreabetting firm etc.) might fall to the extent that they are forced out of business - check the maximum compensation cover you will have on your account in case they go bust, and keep within the maximum cover.

Although TA in a downtrend is 90% (but not 100%) just the inverse of TA in an uptrend, the underlying markets are very different places. Don't expect the same results from a given trading system that looks great in an uptrend when the market flips over.
tomorton is offline   Reply With Quote
Old Sep 5, 2008, 3:22pm   #5
Joined Feb 2002
I meant to add a key question - daytrading is not the only form of trading, and is not the easiest form to begin with - do you know other formats and have you considered / trialled them?
tomorton is offline   Reply With Quote
Old Sep 5, 2008, 5:20pm   #6
Joined Jul 2008
It doesn't matter what economic conditions are, the market will always move. It's about being able to read the market - not economics.
lewtz is offline   Reply With Quote
Old Sep 5, 2008, 7:19pm   #7
Joined Aug 2008
imranmir1 started this thread Well, I am new to the terminology too. All I know is that a prop firm called TCA MArkets train traders, and all my research has shown that it is a legit company...and how successful depends on your own personality and perseverence. So, replying to tomorton, I only know that day-trading is another name for trading in financial instruments like futures/options etc.
imranmir1 is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Recession yet ftse rallys? wins71 General Trading Chat 9 Aug 25, 2008 7:26pm
Article: The Goldilocks Recession T2W Bot Educational Resources 1 Jan 22, 2007 11:37am
Can the US spend its way to avert recession? Dispassionate Economic & Fundamental Analysis 5 Nov 18, 2005 12:41pm

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)