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Active Trading Blog

Risk Management When Trading Stock

Most active traders are intimately familiar with basic risk management — planning entrances and exits before execution and following through with appropriate stop-loss and take-profit orders. However, risk management is much more complicated than simply being aware of at which price points you are willing to buy and sell. This most basic strategy should not.. Read more

Entities Provide Tax Benefits to Traders

By Robert A. Green, CPA and CEO of GreenTraderTax.com. Excerpt from Green’s 2015 Trader Tax Guide. (25%-off coupon at the bottom.) Forming an entity can save active investors and business traders significant taxes. Active investors can prevent wash-sale losses calculated between their individual taxable investment accounts and IRAs with an entity account. Business traders solidify.. Read more

Using Trade Imbalances for Better Trading

Trade imbalances can serve as potential profit opportunities and show positions with an especially high amount of risk. Order imbalances exist when orders to buy or sell a security far outweigh the current supply. These situations usually last for just a few moments because the announcement fuels a wave of liquidity and the market maker.. Read more

Three Ways Active Traders Use Stock Screens

One of the hardest aspects of trading can be coming up with ideas. Abandonment of an investment thesis in order to participate in the market can lead to very toxic transactions. In today’s market of low volatility and volume, this is especially true. This blog post looks at several ways traders can use stock screeners.. Read more

Using Correlation in Extended Hours Trading

The previous Active Trading blog examined risks and preparation for extended hours trading. Now, a strategy for pre-market and after-hours trading is examined. Extended hours trading can be potentially profitable, in part because high frequency traders are not active. However, traders need to be aware that this lack of volume, along with less activity from.. Read more