I expect the S&P 500 index to trade between the recent high and low for a while, several weeks o...
Trader Lesson: How Swing Trading Can Add Value to Your Portfolio
09/22/2017 4:04 am EST
The swing method reduces your risk by having the market and sector forces on your side before you trade. It will allow you to stack the odds in your favor, writes Ziad Jasani of the Independent Investor Institute. Look for more Trader Lessons from our contributors every Friday.
Swing trading is a style of investing for both longer-term and shorter-term investors. It involves finding stocks that are relatively cheap and moving up (a swing low) to buy, and then identifying when those stocks are getting expensive and showing signs of moving down (a swing high) to sell.
Sound easy? Well, it takes a bit of work and discipline. We teach in a common-sense, easy to understand way to ensure you can apply your learning right away. Our step-by-step methodology will show you how to analyze price movement to determine likely overall market direction, then identify ideal sector(s) to find the right stocks or ETFs at the right time or better times to profit from.
The swing trading methodology we teach is all about finding sectors in the market that are cheap and in-favor (outperforming), and then identifying cheap and outperforming stocks or ETFs within that sector where other buyers are piling in to support the upward move.
We buy when we see confirmation that the market supports the trade. We can even swing out longer-term holdings and build portfolios that have above market returns. The key is gaining the right skill set and executing with discipline.
The swing method reduces your risk by having the market and sector forces on your side before you trade. It will allow you to stack the odds in your favor for shorter-term and longer-term positions while helping you consistently make higher probability buy, sell or hold decisions.
Is swing trading right for you?
For the longer-term investor, this method will help you pick your spots better to help avoid market fluctuations and buy assets that have a higher probability of outperforming the market.
For the shorter-term investor, you'll learn how to build high probability trading plans matched to your style and need for income or growth.
Most importantly we'll show you how to spot a downturn before it happens, to help you protect yourself from losses.
Here’s the Market Strategy Session Video for the week of Sept. 18 that explains how to use our current report and provides updates on the market:
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