Holding Stocks Overnight in Day Trading?

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Old Dec 22, 2003, 10:05pm   #1
 
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Question Holding Stocks Overnight in Day Trading?

Hi,

Wonder whether people will hold stocks overnight in day trading.

It seems to me that by definition, day traders close all their positions at the end of each day in order to avoid the over-night risk. However, there have been some interesting examples which seem to defy such a practice. Two of such examples are FNM and MTH on 21/12/2003 and 22/12/2003.

In each case, the stock did well today, 22/12/2003, on top of its performance yesterday. To me, they seemed worth of keeping overnight.

So I wonder whether day traders keep stocks overnight occasionally? If so, what kind of methods do they normally use to decide what stocks are worth the overnight risk?

Thanks a lot indeed.
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Old Dec 22, 2003, 10:06pm   #2
 
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clylbw started this thread MTH on 21 to 22 December 2003.
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Old Dec 22, 2003, 10:22pm   #3
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I think people who day-trade actually take on more risk than people who hold overnight. Big gaps against your position (hence going for the safety of going home flat) is pure propaganda to make people do more business and pay more commissions.

The shorter term you trade the harder it is to make money over time because the cost of doing business is THE dominant factor. You'll end up trading and working for your broker instead of the other way around, especially if you trade cfds.
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Old Dec 22, 2003, 10:23pm   #4
 
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All well and good at the moment when the market wants nothing but up.... It's a risk few are willing or prepared to take. The outcome is NOT under their control.
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Old Dec 22, 2003, 10:37pm   #5
 
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clylbw started this thread Hi anley, ChartMan, thanks for the thought.
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Old Dec 23, 2003, 7:48am   #6
 
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If you're long in an uptrend and closing at the hi of the day there's a good chance it'll open higher next day.

forgot to mention, good volume is important.
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Old Dec 23, 2003, 1:48pm   #7
 
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clylbw started this thread Hi oatman,

Thank you really for the information; it is exactly what I was looking for.

Can you please further explain two points of your suggestion for me? Sorry I am a slow learner.

Firstly, when you says 'long in an uptrend', do you mean an uptrend for the stock, or an uptrend for the corresponding market, i.e. the NYSE index in this case, or both?

Secondly, is the opporsite of the statement true? That is, if I am short in a downtrend and closing at the low of the day, is there a good chance it will open lower next day, with confirmation from the volume?

BTW, is it possible for me to learn more about this aspect, preferably from the Internet or some books?

Thanks a lot indeed.
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