Day Trading vs. Swing Trading: What's the Difference?

Active traders often group themselves into two camps: the day traders and the swing traders. Both seek to profit from short-term stock movements (versus long-term investments), but which trading strategy is the better one?

Day trading involves using technical analysis and charting systems to make many trades in a single day. Swing trading makes trades based on swings in stocks, commodities, and currencies that take place over days or weeks.

Traders should choose the strategy that complements their skills, preferences, and lifestyle.

Day trading is better suited for individuals who are passionate about trading full time and possess the three ""D's"": decisiveness, discipline, and diligence (prerequisites for successful day trading).

Day Trading

- Make multiple trades per day
- Positions last from hours to days
- Full-time job
- Uses short-term buy and sell signals
- Relies on state-of-the-art trading platforms and tools
- Multiple, smaller gains or losses

Swing Trading

- Make several trades per week
- Positions last from days to weeks
- Part-time
- Utilizes trends and momentum indicator
- Can be accomplished with a standard brokerage account
- Fewer, but more substantial gains or losses

Day trading success also requires an advanced understanding of technical trading and charting. Since day trading is intense and stressful, traders should be able to stay calm and control their emotions under fire.

Swing trading, on the other hand, does not require such a formidable set of traits. Since swing trading can be undertaken by anyone with some investment capital and does not require full-time attention, it is a viable option for traders who want to keep their full-time jobs but also dabble in the markets. Swing traders should also be able to apply a combination of fundamental and technical analysis, rather than technical analysis alone.