Investing and trading are trends that are continuously growing worldwide. Day trading is one of the most popular ways of trading, and a big trend among UK traders. A day trader does exactly what the name indicates: buy and sell financial assets within the same calendar day in order to make a profit.
Day trading is an accessible hobby, and even a living for some. The trades can be made with for example stocks or currencies. So, what makes the trading style so popular? Here are the reasons why day trading is on the rise and how it works.
1. Large supply of brokers which offer GBP accounts
The Great British Pound is one of the most traded currencies in the world. On the foreign exchange market, it’s the fourth most traded currency. Because of this, people in the UK can choose between a wide range of good trading platforms, making the process of starting with day trading quick and simple. Have a look at brokers that offer GBP accounts if want to get started with day trading.
There are several benefits of choosing a broker and trading platform which use pound sterling as a base currency:
- Fast funding and withdrawals, normally no longer than one business day.
- They often don’t charge for deposit and withdrawals (although there can still be third party fees).
- Easy to use since you don’t need to convert GBP into euros or U.S. dollars.
- Safer because of lower exchange risk and authorisation by the Financial Conduct Authority.
2. Day trading gives you instant feedback
Day traders need to stay sharp while also controlling their emotions. As a day trader you benefit from quick thinking, and you’re rewarded with instant feedback on your decisions. You have the potential to learn quickly since you can make many trades a day and also see the results straight away after buying and selling.
3. Exciting for people who enjoy logic, reasoning and analysing
If you’re a logic driven person who can stay calm under pressure, with an interest for analysing risk and rewards, you’re more likely to make successful trades. Many people take up day trading as a hobby because of the analytical and logic side to it.
Apart from the ability to make money, day trading as a hobby in itself can be exciting. You have to think before you act, all while being prepared to make fast decisions. Discipline and controlling one’s emotions are important traits to have in order to succeed – just like in many other aspects of life.
4. Making a profit from falling prices
The nature of day trading means you can benefit even from falling prices when the market is struggling. Experienced traders know how to take advantage of bear market conditions by using short-selling trading strategies.
5. Easy to get started and plenty of resources
All you need to start day trading is an internet connection and a laptop or PC. However, you should first read up on the subject by using free guides online. Preparation lowers your risks and increases your chances of making good trades.