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Who are the different types of Traders?

Stock traders and stock investors are two different types of entities. Different strategies are used for different jobs.

Stock investors are bodies or individuals who use their own money to trade in the stock market in expectation of profitable returns.

Stock traders are bodies or individuals who take part in the trading of equity or security either for them or on behalf of other people.

Stock traders are usually professionals who take on buying and selling stocks to profit from short-term price unpredictability with transactions that range from a few hours to few weeks.

They are anxious with the following mentioned below:

1.Price Patterns:When a trader examines the past price movement of a stock to predict future price, it is known as technical analysis.

2.Supply and demand:The trader keeps a close watch on all intra-day transactions to see where the stock price is headed.

3.Market Emotion:Traders also play on the emotions of the investors by using techniques like fading.

4.Trader Support:A particular type of traders called market makers are hired to deliver liquidity through swift trading.

Approaches of trading in equities:

Scalping:A trader who makes plenty of trades in a day, and intends to scalp a partial amount of the profit from each trade by using the bid-ask spread

Technical Trading:These kinds of traders are trained to monitor graphs and charts closely to find the trend of the market and invest accordingly.

Fundamental Trading:This trading is based on fundamental analysis that takes into account corporate events like predictable or actual earnings report, acquisitions etc.

Swing Trading:The fundamental traders who stick on to their positions for more than 24 hours are known as swing traders. In order to make a decent profit, they need to stick on to the stock as any change in the corporate fundamentals normally needs some days to weeks.

Intra-day trading: The share that is bought on a day needs to be sold or squared off within 3pm on that day.

Momentum Trading:The traders who find a stock that is incessantly and considerably moving upward with a high volume. These traders trade on that to get a high profit.

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