Types of Traders and Investors

There are different types of traders. But only two types of investors that I know of.

1. Investor dahil nakulong.

• These are investors who just jumped in a stock that they didn't even study. They bought at the peak and are waiting for the stocks to come back. Some stocks never comes back. Some will also come back. It is just a matter of time. But in stocks time is of the essence so you need to study whatever stock you are investing in. Some will ask you advices on what to do on their stocks. But the answer really lies within them. They just have to ask why they bought the stock. For what purpose did they buy the stocks. Do they really believe the company and the management of the stocks. If you can't answer it better cut that if you can't sleep at night and study first about fundamentals and technical analysis.

2. Investors sleeping on their gains.

• These are investors who bought the dip and are just sleeping happily with their gains. This is the right type of investing and the right time where patience should be practice. If you know the companies' fundamentals and you think the price is still undervalued and if you analyzed the other businesses of the company owner and the owner thinks of his/her investors then they will share portion of the profits to you.

Types of traders:

There are actually 4 general types of traders but for the sake of other traders' opinions let's also include the others as just extension of the 4 types of traders.

1. Scalper: Scalpers are momentum traders who speculate in the price action of a stock. If he thinks this stock will rise he will enter and unload the stock in just a few flucs in a few hours. Usually they are into volume and earning just a little will already let them go out of the market. This is a little risky type of traders you need to have a great observation skills on price action and has a great understanding about the support and resistance before you enter a trade. You should not be too greedy and be happy with small gains. And you should always have a stoploss for this kind of trading if the direction of the trade is opposite from what you expected.

Cons: not maximizing the gains.

2. Day traders: Just like the scalpers, day traders also go to buy a stock where they can earn in just a day. They are also momentum traders looking for a stock that has great price action. They never held a stock overnight. They might jump from a series of stock that has great momentum after they come out of a trade. This type of trading style is somewhat exhausting. You need to watch the ticker all day if you can trade a stock or not. You should have fast executions and fast calculations on decision making. You should also have fast hands especially when the dumping time is next in line. This is a little bit on the risky side. If you want to know the risk of this one let's check SPM and LMG chart on how fast these big funds throw a single stock.

As we can see on this example this is where it all happen from the open of 3.95 it went as high of 4.8 until STARALL decided to sell it down to 3 pesos. The profit here has a high potential but can you act fast if shit happens. If the answer is yes then this is all for you. If not, then look for another type of trading that suits your style. We can also see that day trading loves the volatility of a certain stock. Greed should be tamed in this kind of trading and you will surely enjoy the profit. Also check for the volume of the stock, the bids for this stock just buy the first 3 volume that you can see on the bid so whenever you have to sell your stock you can still sell it. Don't buy so much you can't afford to sell on this kind of illiquid stocks.

LMG is one example wherein a selldown happened to. This one is much better than SPM since this one has bounce somewhere on its midtrend. This is also where daytraders jumps in the buy the bounce style. They hit and run and waited for another support and bounce. As always you should have fast reflexes on this type of trades. Trade just a minimal amount if you want to join the fun and if you want to learn this kinds of plays something you can afford to lose.

3. Position Traders: This are traders that look at the weekly or monthly chart. They prefer the buy and wait approach. More for sniping someone who buys at the dips or someone who waits for the support of a certain stock. Most position traders I know also knows fundamental analysis. They analyze the management of the stock, the earnings, the disclosures and once they have seen everything intact they wait for the right price. Here is the quote of one successful trader I respect, "Patience is not just for the appreciation of the price of your stock position, it is also used in waiting for the right time that stock hits the support and that is where we buy."

This is one of the positions of a position player of 1-2 mos. Let's check his stocks and where exactly did he buy his stocks. Let's check DD first.

Here we can see that DD is in a downtrend he didn't buy immediately. The lowest cost that DD has gone down on that time is 32 but his average is 37. So he might have waited for a confirmation and bought somewhere the box. Then he just sit and enjoyed his profits and still is currently waiting. Right now DD is on an uptrend consolidation trend.

Now lets check the second one which is RLT.

On this type of stock we can see that it is a different formation as DD. This one is forming its flag. He bought on the place somewhere between .56-.60 that's why his average price is .57 now the stock is running at .68-.70.

Last but not the least is X.

On this example he bought when he saw the sign of reversal when the first bullish candle appeared. You can also see that 7.08 is a strong support in the past and it is the second time that the price holds. We can see a strong support or strong resistance when it is tested so many times but the price is holding on that certain price but wait for the next day price action in the ticker if it became active then it's a signal to buy that stock.

4. Swing Trader: Swing traders are like the day traders and the scalp traders but they have a longer timeframe than the two but shorter than the position traders. As for the word swing they buy a stock until they hit their target price and look again for another opportunity in other stocks.