Source: Stansberry Churchouse Research
Any kind of asset, whether it’s a stock, bond, ETF or commodity, can be held as a long-term investment or can be traded for a short-term profit. For the traders, they will buy and hold it anywhere from a fraction of a second to a few weeks. But, they all have one main objective – to make short-term gains on an investment.
The different types of trading strategies:
Momentum traders look for assets that are making a major move up or down and have a large number of shares trading hands. They hope the momentum will continue, and they hold the asset until the price reaches a pre-set level, which can take minutes or days.
Technical traders look for patterns or trends in stock, bond, index or currency charts. They make trades based on what those patterns have done in the past. They may not know anything about the asset they’re buying or selling. Their decision is solely based on what the chart looks like. There are 2 kinds of technical traders: