If You're a Day Trader, You Could Be Making a Big Mistake

Posted 6:01 PM 12/15/10 ,
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For investors, "buy and hold" has always been considered the sensible way to invest in the market. The idea -- put your money into stocks, index funds or mutual funds and over the years, you will earn an average of about 8%.

But whacky market gyrations over the past few years have led many investors to either give up on investing altogether -- or become active traders, hoping to generate profits from the volatility. Generally speaking, these day traders are investors who trade frequently every day and believe that by timing the market just right, they will generate impressive returns.

But James Altucher, managing director of Formula Capital, says that day trading is a mistake. A former day trader himself, Altucher explains that today, day trading is just too difficult. In this short video, Altucher explains the pitfalls of day trading -- not just to your portfolio, but also to your health.
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Nikhil Hutheesing

Nikhil Hutheesing

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Assistant Managing Editor

Nikhil Hutheesing is an assistant managing editor at DailyFinance, overseeing investing and tech coverage. He is a 17-year veteran of Forbes magazine and Forbes.com, where he covered business strategies, investing, and tech and helped develop and run the Forbes Newsletter Group. He was also the editor of top-ranked investing newsletter Forbes Wireless Stock Watch. Nikhil, who earlier spent four years in banking on Wall Street and briefly did financial planning at Viacom, has appeared on Fox News, MSNBC and CBS' "The Early Show." Nikhil won the 1998 South Asian Journalist Association's Journalism Award for Outstanding Story for his Forbes article, "Faster, Cheaper, Better-Forever."

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