Deciding What to Trade and How to Trade It
In This Chapter
Finding good assets for day trading
Seeking securities to trade
Counting cash and currency
Making money from commodities
Deriving profits from derivatives
So what are you going to trade? Stocks, corn, or bitcoins? You have myriad choices, but you have to choose so that you can learn the market, know what changes to expect, and make your trades accordingly. And to avoid the devilment of the wash-sale rule, which can limit the tax deductibility of short-term losses (and which you can read about in Chapter 15), you probably want to make your universe of trading assets to be as broad as possible.
Still, you can't trade everything. A day has only so many hours, and your head can hold only so many ideas at any one time. Furthermore, some trading strategies lend themselves better to certain types of assets than others (see Chapter 8). By finding out more about all the various investment assets available to a day trader, ...