Hi Darth,
One of the hardest questions about share trading/investing I must say
It all depends on the individual, their skills, circumstances, tools and size of capital (the time scale one may need it back) really...on the other hand the type of shares one concentrates on and the sectors in combination with general/sectoral trend are all factors one has to consider when deciding on trading vs investing...that also raises another question as to short, medium or long term...
I prefer trading rather than investing for the simple reason to start with I don't have a capital that I can invest and forget about it for a long time, all I have is a limited capital which has to provide quick returns and be available the moment I need it, since I don't have any other source of income, this is why I mainly swing trade and sometimes trade intraday and trade cfds so I can make use of margin trading...if one has that sort of capital it's certainly worth while as you said...about nine companies that I thought were worth to invest in about 1.5 years ago have now gone up over 100%, with proper stop loss even if you get 3 out of 10 right you win a lot...with your skills and performance I don't think you'll ever stop building up your capital by investing long term...
I am sure you're already more than aware of all this, so I'd better limit myself to trading which seems to be the sort that you want to get opinions about...intraday, swing and positions trading are the most common types to consider...
For all especially intraday and swing trading you need to be able to spare time during the day to follow the stocks you trade intraday (that is a necessity without this it's best to forget about it)...TA skills undoubtedly needed together with L2 and real time price facilities which can be arranged anytime so long as one is prepared to pay for them...
Once you get all these and you start short term trading whatever the type is you soon find out that your main problem is your psychology...some traders tend to ignore or underestimate this but my observation is that behind most trading disasters you can find the failure in psychology, trading is one of those most emotional things and your psychology is bound to have an effect on it (either positive or negative, mostly I find out it's negative)...
Most traders know the rules, but not all apply them properly: we know about the money management, stop loss, cut loss run profit, but the question is how many of us apply them without exception...how many times do we witness greed, fear, dithering, pride, inability to accept and stomach one's mistakes taking over decision making and causing big losses...we've covered stop loss or cut losses here so many times, but we still see cases of serious losses just because we don't apply stop loss or cut losses and run losses instead of profits...
So why is this? We know it, but we still do it burning our fingers...the answer I think is psychology...maybe this is why we have a market some will apply some will not so we can have winners and losers...unfortunately big losers being the public and big winners the big guys...
You may by now be saying stop beating about the bush and come back to the question
So I'd better come back to your considering to trade short term, in your case I think the question will be whether you can spare time intraday, if you can do it, I think it's worth a try, maybe initially small trades to be on the safe side, as to me you seem to have all the required skills and experience even more than many traders I have observed...there is a lot of volatility over there and if one has the skills and experience to make use of it, why not?
By the way, do you use L2?
Hoping you might find a couple of useful points in all this, and will be glad to make further comments if needed...also other members contribution to this could help it turn into a more interesting and useful discussion...
good luck
Riz
