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A Few Pros and Cons of Online Trading

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Online trading gives you many of the advantages previously enjoyed by professional investors, including unprecedented access to information, analytical tools and other execution capabilities
These enhanced resources may appeal to people who want to trade on short-term movements in stock prices. This strategy is extremely risky and requires a serious, ongoing time commitment. Day trading, in particular, requires constant monitoring of the markets, often to the exclusion of other activities. Investors are wise to stay away from thinly-traded, little-known stocks sold strictly on the basis of online hype. Unlike blue chips or stocks with a substantial number of shares available, the price of low-volume stocks can be moved through relatively small strategic trades. Even if the hyped stock starts to edge upward, it may simply be part of the manipulation scheme. If you did not already employ strategies such as market timing or momentum investing, do not start now merely because you have started investing electronically. Online capabilities might simplify - but should not fundamentally change - the way you invest.