The Truth About Day Trading Stocks: A Cautionary Tale About Hard Challenges and What It Takes To Succeed

by Josh DiPietro

Overview

A realistic guide to day trading today’s stock market

"Josh does an outstanding job of capturing all his trading experience into an invaluable memoir detailing specific rules for both the inexperienced and experienced trader. Anyone interested in trading professionally should read this book as they will learn invaluable lessons."
—Stephen Ehrlich, CEO, Lightspeed Financial, LLC

"Having been a trader for over twenty years myself, I’ve read my share of books about the financial markets. Josh’s book is one of the few which doesn’t sugarcoat the fact that successful trading is both hard work and takes a long time to master. These lessons and guidance are drawn from real-life experiences, not hypotheticals, which simply adds to their weight. Active traders who are serious about their success need to read this book."
—Tim Knight , founder of Prophet.net, author of Chart Your Way to Profits

"A brutally honest depiction of the reality of trading. Great stuff. If you’re new to the trading game, this book will shorten your learning curve and—if you take its lessons to heart—it just might save you money and grief."
—Jason Alan Jankovsky, author of The Art of the Trade and Trading Rules that Work

Product Details

ISBN-13:	9780470495858
Publisher:	Wiley
Publication date:	05/27/2009
Series:	Wiley Trading , #421
Sold by:	Barnes & Noble
Format:	eBook
Pages:	208
File size:	1 MB

About the Author

JOSH DIPIETRO has been day trading stocks for ten years. He operates a web site (www.daytraderjosh.com) and provides training programs for aspiring day traders. DiPietro's trading approach involves making many trades every day, taking small profits, exiting losing trades quickly, and minimizing transaction costs. He is a critic of the educational paths offered by the established trading industry and is dedicated to providing an alternative educational approach for aspiring traders.

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Table of Contents

Preface.

Acknowledgments.

Introduction: The Wholehearted Amateur.

PART I Psychological Truths and What to Do about Them.

CHAPTER 1 Truths about Yourself to Know First.

How Often Do You Trade, and How Profitably?

How Much Are You Trading in Capital and Leverage?

How Long Have You Been Trading?

What Financial Instruments Are You Trading?

Are You Trading Other Peoples' Money or Your Personal Capital?

Are You a Licensed Trader, or Trading Independently?

How Were You Trained?

Rules to Remember.

CHAPTER 2 How Emotions Can Destroy a Trade.

The Fear Factor.

Greed Is Not Good.

Rules to Remember.

CHAPTER 3 Preventing Overconfidence.

Ignoring Your Predetermined Stop/Loss Price.

Holding Too Long.

Rules to Remember.

CHAPTER 4 From Impatient to Cool, Calm, and Collected.

The Waiting is the Hardest Part.

Deciding to Learn More.

Rules to Remember.

CHAPTER 5 Taking Breaks.

Break When Your Confidence is Low.

Break Because It's Just Not Working.

Break and Then What?

Rules to Remember.

PART II The Truth About Your Risk.

CHAPTER 6 The Importance of Risk Management.

The Amount of Trading Capital Allocated to Each Trade.

The Timing for Allocating Capital to a Trade.

Overexposure to Risk.

The Stock or Company You'Re Trading.

The Time of Day You're Trading.

Gambling.

Rules to Remember.

CHAPTER 7 Why Overexposure to the Market Can Hurt.

Time versus Timing.

Rules to Remember.

CHAPTER 8 Budgeting: Knowing Your Financial Limitations.

Don't Quit Your Day Job: Catch-22.

Crunching the Numbers.

Cushion Cash.

Rules to Remember.

CHAPTER 9 Minimizing Your Risk with Stop/Loss.

Making Stop/Loss Automatic.

Rules to Remember.

CHAPTER 10 Averaging-Down: A Skilled Strategy.

To Average-Down Successfully Takes Mastery.

Know-How Doesn't Grow Overnight.

Rules to Remember.

CHAPTER 11 Gambling versus Day Trading.

Rules to Remember.

PART III Intraday Trading Truths.

CHAPTER 12 Why Some Traders Make More Mistakes.

Pick Your Stocks Carefully.

Focus, Focus, Focus.

Pay Attention to Market-Moving News.

Rules to Remember.

CHAPTER 13 Trading Consistently All Day.

Rules to Remember.

CHAPTER 14 Stock Picking: Simplifying the Process.

Your Stock Should Have an Average Daily Volume of One Million Shares or More.

Choose Stocks between $10 and $100.

Pick Stocks That Display Tradable Intraday Price Swings.

Don't Trade Stocks Affected by Strict Federal Regulations.

Beware of Stocks Directly Affected by Current News Headlines.

Rules to Remember.

CHAPTER 15 Why News Can Be Just Noise.

Trading on News versus Monitoring News.

Rules to Remember.

PART IV The Truth About Training and Preparation.

CHAPTER 16 About Those Training Programs.

Seminars for the Greenhorns.

Training Programs for the More Experienced Trader.

Tips for Selecting the Right Program.

Rules to Remember.

CHAPTER 17 Picking the Right Online Broker: Pay-per-Share versus Pay-per-Trade.

Starting Out with Pay-per-Trade.

Transitioning to Pay-per-Share.

High Leverage Pros and Cons.

Hang on to Your Pay-Per-Trade Account.

Rules to Remember.

CHAPTER 18 Paper-Trading Strategy.

Paper Trading for the Amateur.

A Word About Advanced Paper Trading.

Rules to Remember.

CHAPTER 19 Trading for Skill versus Trading for Income.

Building a Foundation of Trading Skills.

First Level.

Second Level.

Third Level.

Summary.

Rules to Remember.

CHAPTER 20 The Perfect Trading Day.

Early Morning Activities.

Pre-Market Trading.

The Opening Bell.

Midday Activities.

The Last Hour of Trading.

The Closing Bell.

After-Market Trading.

Homework.

CHAPTER 21 The Worst Trading Day.

Early Morning Activities.

Premarket Trading.

The Opening Bell.

Mid-Day Activities.

Last Hour of Trading.

The Closing Bell.

After-Market Trading.

Homework.

Conclusion: Parting Words.

Appendix: Rules to Remember.

About the Author.

Index.