Not long ago my wife and I were out of town at a large shopping mall and came across a kiosk featuring all sorts of stock market “education information”. I took one of the guy’s cards and looked up his website to see exactly what type of “education” was being offered, ahem…sold. Well, turns out it is basically a day trading system where you buy and sell small amounts of stock in order to “capture” profits.
The foundation of day trading is what used to be called “charting” or technical analysis. Adherents believe that they can forecast future price movements based on stock “charts” or trends. I can recall back in the late 1990’s, almost every national magazine had stories about investors leaving their 9-5 jobs in order to sit at home and day trade stocks. It worked…until it didn’t.