Don´t go to the Casino I still think you should explore and take the next step in investing, though not necessarily "trading".
I consider myself an active investor but not a trader. I read news and follow markets daily to be up to date and I re-balance quarterly. My portfolio consist of 75% funds and 25% stocks.
If we divide people into categories as:
- Non invested - keeps cash in the bank
- Buy and hold - invests in an index fund without rebalancing
- Active buy - Invests in different funds/stocks to increase diversification
- Active investor - Invests in different funds/stocks and rebalances based on a preset investment strategy
- Swing trader - Buys sells stocks or other instruments to hold 1-5 days
- Day trader - Buys sells stocks to keep for less than 1 day
- Options / Derivatives trader - Uses other instruments to hedge positions, usually as a day or swing trading strategy
- Forex / Commodities trader - Instead of trading stocks, trading Currency pairs or commodities such as metals, gold, silver
The reality is that many are in the #1-2 category and want to make a jump to #5-8. I have tried it and lost money, thanks for sharing as well @HighIncomeParent
Two important things to decide for any investment strategy is:
- Your rebalancing frequency
- Your tolerance for risk
These things become more important if you increase them since our brains tends to lean to irrational decisions when we have the most need to rely on a preset strategy, many will argue that being disciplined is key factor to succeed in trading.
Anyway, I wouldn´t encourage you to try anything called swing trading, though you could always take a next step where you slightly increase your tolerance for risk and/or frequency.
Personally I have decided to develop my increasing my tolerance for risk but not the frequency. The decision to keep my frequency is that I don´t believe I have an egde which will make me increase the returns at a lower risk by going from quarterly to monthly re-balancing.
I have decided to increase my tolerance for risk by moving some parts of my portfolio from funds to stocks. I will look at what the funds invest in and buy the stocks instead, this way I won´t pay the fee to the fund, I get to do some adjustments of my own and at the same time learn and have more fun with my investments. I am also looking at some figures though relatively fundamental and basic metrics such as
- The P/E - How is the company valued in relation to their return, compare with other in the same industry
- The development of earnings, compare with other in the same industry
- The development of revenue, compare with other in the same industry
- Is the company doing something I understand and believe has a good potential
- Based on what I know about the current financial climate/macro economics, what is the general outlook for the company's industry
With this strategy you could do a test for yourself to see if you can beat a selected funds returns with your own strategy. Mostly for fun and don´t take out your victory too early The real tests are when markets change.
I don´t know what level you are on and this may be basic info to you. I just wanted to share to tell you how I found encouragement to develop my investment skills, though without taking a major leap. Going from funds to stocks is a whole new area and there is so much to learn, it´s relatively easy to pick up small parts over time and you don´t get as overwhelmed as with the technical stuff. I may increase to monthly investments some time in the future but right now the change of of my portfolio feels like a good path.