While you are trading in stocks, you must be aware of the factors that are affecting the price of your stock. Stock market does a pretty good job of figuring out what each individual company is worth in the long term. While the stocks go up and down for many reasons in the short term, but only some are rational. There are many companies that are scams and they will eventually fall apart. All good companies make real money and solid business succeeds and continues to be good.
We know that a stock price may drop because of a rumor about its business on any given day. A report from a stock analyst which may be right or wrong might affect the price of stock. There are various other countless reasons to fluctuate the stock price. They are broad macroeconomic news, one person or fund selling a lot of shares to take a profit. These reasons may have nothing to do with the underlying business, yet they will change the stock price anyway.
Many economists like to talk about perfectly rational actors, as if investors always followed a set of hard and fast rules.
If you trade with accurate intraday tips and be disciplined while trading then you get good returns. When you are practicing day trading, then it is necessary to know to handle the fluctuations of the market. So if you are also seeking to get high returns by trading then you must go for day trading as day trading needs low margins and offers more leverage on your trading capital. There are many brokers, who offer 100 percent leverage. This means that you are allowed to trade with more amount than you actually hold in your account at present. This can increase your profit by many folds. But it is recommended to take the help of renowned advisory firm so that you do not suffer from losses and you minimize the risk.