 | | Are You a Short-Term or Long-Term Trader? | | Marc Lichtenfeld, Chief Income Strategist, The Oxford Club | Wait, what happened to O'Reilly's money?
Bill O'Reilly was the highest-paid news host of all time. You'll never believe what happened to his money. Details here. | | | Editor's Note: Today, Chief Income Strategist Marc Lichtenfeld explains how to determine which trading strategy - or combination of strategies - is right for you.
After all, even experienced traders can improve their technique by knowing themselves.
And whether you're an accomplished trader or brand-new to options, sometimes it pays to find a strategy that can earn you dramatic short-term returns without requiring you to always stay on your toes during the market day.
That's why Marc has developed a powerful but low-maintenance options strategy...
With daily trade alerts based on one type of investment - "The Last Ticker Symbol You'll Ever Need" - Marc offers Oxford Club Chairman's Circle Members simple instructions for locking in gains of up to $130,000 in a single year.
Click here to learn how you can join this elite group.
- Mable Buchanan, Assistant Managing Editor
In my 20s, I started out on a trading desk where traders rarely held any positions overnight. They were day traders who got in and out of their trades in a matter of hours - and sometimes minutes.
As my career evolved and long-term investing became my focus, I shifted my goal to owning Perpetual Dividend Raisers for years.
Now I find stocks that my readers should be able to hold indefinitely as the companies raise their payouts every year. | | | But that's investing. On the trading side, it is appealing to be in and out quickly.
With some stocks, you have to wait a few weeks for a catalyst or technical pattern to play out. And that's fine.
There's nothing wrong with earning double- or triple-digit returns in a few weeks or even months. Most investors would be thrilled with that kind of performance.
However, some traders like the action and don't want to wait weeks for the payoff. They prefer to be in and out in a matter of days, sometimes within the same day.
While it's more speculative, some risks are eliminated. For example, you can't get attached to a stock because you've held it for a long time or because you believe in the story.
Intermediate-term traders typically own stocks for a few weeks or longer. They're waiting for a story to play out, such as an earnings report, a drug approval or a completed chart pattern.
They'll usually set stops that give the position some room to move. That way, they won't get shaken out by market noise, but they also won't suffer too large of a loss if the trade goes against them.
Shorter-term traders will hold a stock for a few days or less. They're usually exploiting strong moves in the market or stock.
They'll typically take smaller (but perhaps more frequent) losses in exchange for more frequent trading opportunities and wins.
When deciding what type of trading style is best for you, ask yourself the following questions... | | | If You Don't Know About This New Law... Don't Buy Pot Stocks
Knowing how this law works... and the benefits behind it...
Led one Oxford Club Member to more than $800,000 in profits. And he's just one of many people BANKING from knowing about this. | | | How much time do I want to commit?
Shorter-term trading - and particularly day trading, when you're in and out of a position within the same day - usually requires you to stay in front of your computer (or at least on your phone) during the trading day so you can make moves all day long.
Traders who expect to be in trades for a few weeks don't have to spend as much time tied to their computers.
What's my tolerance for risk?
Traders who stay in positions for several weeks usually give their positions more room to travel so that they don't get shaken out by market noise.
That means they have to be able to tolerate some moves to the downside.
Shorter-term traders take smaller losses, but they need to be able to pull the trigger and take them quickly.
What strategy makes the most sense for me?
Do you like to trade based on earnings reports, volatility, charts, valuation or FDA approvals? Certain catalysts will lend themselves to shorter- or longer-term trading styles.
If you like to trade the markets based on volatility, your trades will likely be short-term in nature. If you love trading biotech stocks based on upcoming clinical trial data, your trades will have a longer duration.
If you're new to trading, start off by asking yourself which style appeals most to you.
If you're an experienced trader and you're not achieving the results you want, these questions may help shed some light on whether you're trading in a way that best suits your personality.
Good investing,
Marc
P.S. My Closing Bell Profits system takes the guesswork and stress out of options trading. With easy-to-follow daily instructions, I show my readers exactly how to profit regardless of what happens in the market.
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The Oxford Club is a financial publisher that does not offer any personal financial advice or advocate the purchase or sale of any security or investment for any specific individual. Members should be aware that although our track record is highly rated by an independent analysis and has been legally reviewed, investment markets have inherent risks and there can be no guarantee of future profits. The stated returns may also include option trades. 
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