By including an element of swing trading in their portfolio, investors can evolve their approach to match the new investing world. This evolution can both mitigate increased volatility and accelerate their wealth creation.
Swing trading can go a long way to counter this volatility and add extra juice to investors’ returns. Swing traders aim to profit from changes in prices over as little as a day to several weeks.
As the great investor Warren Buffet has said. The key to wealth creation is not to lose money. For swing traders, it is to manage risk in return for the potential for making greater profits.
Day Trading: Day traders look to profit immediately from very short-term moves in the price during the day. So they will open and close trades during the day and will seldom keep a position longer.
Swing Trading: Such traders aim to profit from a single, strong price change in the market (swings). They will generally plan their trades using the daily charts.
An advantage of swing trading is that it can introduce the trader to trading on margin. Margin trading allows the trader to borrow funds from their broker.