You must Sign In to post a response.
  • Swing trading average interest return per month

    Interested in trying your hand at swing trading? Looking out for detailed infromation regarding ghow to calculate average interest per month in trading? On this page our experts have provided answers to your question.

    Recently, after watching swing trading videos on Youtube, I have got interested in trying my hand on swing trading and I wonder how profitable it would be. So, can anyone tell me what would be the average interest income per month of a successful trader?
  • Answers

    5 Answers found.
  • Swing trading is a normal practice of holding securities or financial instrument for shorter period which is quite different from intraday trading and I feel that also quite difficult and riskier then intraday trading. I am of the perception that if you want to make a good from the market then avoid speculation and prefer long term investments. But swing trading can also make a good for you if you are passionate , it depends on market trends and deep research of the market.

    I want to explain you about swing trading in capital market(stock market):
    Since we know that swing trading involves holding securities for period greater then a day then you have to bear more risk, but if you are confident about your stocks, for instance of you invest mainly in large cap companies, whose stocks show very less price fluctuations in small period, then you are confirmed of no loss and drawing some gain. Buy you need to invest good money in such case, as profits by small margin can be concluded as good only if you work I'm volumes. But if you are new to market then it is advisable to keep eye on such stocks, read their annual results and start trading in small amount. Once you gain experience and become sure about next step which company might take, at that time you can invest a large amount, but never forget that even when market is bullish in nature you might lose a large amount and hence never forget to keep a security cushion, I.e. maintain margins.
    Here are some factors which can me kept in mind by swing trader:
    Leverage: Leverage refers, how actively your security is traded. So it's easy to square off your positions if securities are more leverage.
    Market movement: I remember one of the most famous Warren Buffet's quote that be greedy when others are fearful, and be fearful when others are greedy. Hence market trends play a major role in your profits, and hence if you clear your holdings in bullish times than you can make good.

    I know it might be risky, but never forget profit is the reward for your risks.

  • Swing trading is a type of trading to capture short- to medium-term gains in a financial instrument. In this trading, the shares will be held by the trader over a period of a few days to several weeks. Swing traders use technical analysis for trading. They may utilize fundamental analysis also to analyzing price trends. The profit or loss in this depends on your understanding of the stock trading business. There are people who gained or who lost also. It all depends on your skills. We can't say you will get this much profit. One should be in constant watch and go for purchase as an upper swing is noticed. They should follow the particular share and should sell the shares the movement indicates a negative swing. Very close observation and understanding are required. They analyse the assets chart and determine where they will enter, where they will place a stop and where they can get out with a profit.
    This trading is having the following advantages.
    1. Tha trading can be carried out in less time than day trading.
    2. One will get maximum short-term profit if properly participated in this trading.
    3. The traders exclusively use technical analysis and hence the process is simple.
    But there is the other side of the coin also.
    1. Swing traders often miss longer-term trends.
    2. Trade positions will have overnight and weekend market risk.
    3. Sometimes the market may have abrupt reversals which can cause substantial losses.

    always confident

  • Earning twelve to fifteen thousand per month by way of investing in the swing trading is very much achievable if the following parameters are observed-
    1) The stocks chosen should be in a trend.
    2) Strength of the chosen stock is to be evaluated and for that you can apply momentum indicators.
    3) You have to analyse its long to medium term horizon to assess its support and resistance level providing its early entry and late exit.
    4) You need to adhere to judicious use of the price and time action rather than the other indicators for swing trading.
    5) In most of the times, averages work better in raking of the profits and you must go through it in your trading setup.
    However, the results of the swing trading are unpredictable often causing erosion o the value of stocks but the overall results are satisfactory provided the averaging theory is employed.

  • Before going to get a feel of swing trading, the investor must understand that swing trading is not the cup of tea for everyone. It has certain risks and only experienced people should venture in this field. When a person wants to make money from the stock market in a few days time then the basic expectation is that whatever he buys, its price increases soon so that he can book the profit. It is expected because of the fact that the person must had studied about the particular stocks that he had bought and must had done the market study about it. Unfortunately, market does not work in that fashion because there are so many factors which affect the market and sometimes even the best speculations fail miserably. So, one has to get prepared for that and be patient and calm in such situations when profits are nowhere seen.

    Many traders and investors know these fundamentals and tread in the market very cautiously. One important thing in this matter is that cautionary steps will most of the times not help in increasing the profits but containing the loses. This has to be understood deeply if a person wants to learn the swing trading.

    There are some favourable situations when a person can definitely make profits in stock market and one example is during the bull run. Many times due to favourable factors like political stability, economic development etc the stock prices start increasing in the market. It is also to be noted that all stock prices would not rise but in some select industries this will be obviously seen and a shrewd investor will jump in it investing significant amounts and within that increasing trend at some opportune time quit the market making huge profits. In such endeavours, timing is very important and one has to do it before there is a falling trend due to some adverse business news in the media or bad report of a company. Let us also understand that if the timing is not correct then he may not be able to sell it later when there is a falling trend and everyone else starts selling and prices crash down.

    In any case if the person could not sell at an appropriate time then he will have to wait for another increase which may again come in that stock may be a few months later or take a decision to sell them at loss. Now, the total gain will be the sum total of profit and loss and one has to see whether it was finally a profit or a loss.

    In a market, variations will be there and rise and fall will be there umpteen number of times and will be industry as well as company specific. So, not only the knowledge about the companies is required but also one has to be able to speculate about the market and its twists and turns. Understandg these trends and making profits is the objective of swing trading.

    Before I close, let me put one interesting example. In a falling market, an intelligent investor will immediately sell his holdings and buy them or some other scrips depending upon his judgement, later when prices drop considerably and that becomes his base point for future to make profit when reversal takes place. There are many such tricks of the trade that swing traders often resort to.

    Knowledge is power.

  • The target of swing trading can be decided upon the last swing high if you are taking the swing trade with bullish view and vice versa for bearish trade. Suppose if a stock is trading at Rs. 100 and its last swing high was Rs. 120 and if you see the trend of the stock has changed turning bullish then you can take the Rs. 120 as target. In this case the return earned becomes 20%.
    When you are taking a trade please also consider the stop loss for that trade. In above case, suppose if it doesn't hold the Rs. 100 position and the stock price further drops then you should consider the stop loss to minimize the losses. The risk to reward ratio for such trades should be defined, for example for a 100 Rs. stock price you can consider the stop loss of up to 5% for a reward of 15-20%.
    Most traders keep this stop loss as 2% of capital. Do the mathematics before taking the trade. As said earlier 15% target is the best level for booking profits.

  • Sign In to post your comments