Short-term trading covers a range of methods, including swing trading over a span of days to weeks, day trading that completes a position within a single day, and scalping that repeats trades over spans of seconds to minutes.
Main methods
- Swing trading: aims to capture price movement over roughly days to weeks
- Day trading: completes buying and selling within a single day
- Scalping: repeats small trades over spans of seconds to minutes
Benefits and points to keep in mind
Results can be assessed over a short period, but this comes with the need for frequent trading decisions, and transaction costs (commissions and taxes) tend to add up more. Predicting short-term price movement also carries an inherently high degree of uncertainty. Compared with other investment styles such as long-term investing, neither approach is inherently superior — each has its own characteristics and points to keep in mind.