To decide what type of trading you're going to get into, you ultimately need to decide how much time you have or want to dedicate towards trading.

For example sake, let's say you want to start day trading, but you don't have a set time in the morning to trade because you're at a job or doing other things. This is a classic situation in which time is a barrier to success, because you'll need to be watching the market's every move, every morning.

On the other hand, in the Forex currency exchange and other international public stock and commodity markets, you can literally trade 24 hours a day. You can trade the Japanese Yen at 5:00 a.m. in the morning, or you can trade the Euro at 11:00 p.m., all thanks to time zones and globalization of the Internet. It all comes down to what your schedule is and what it allows.

Determining Your Time Frame for Trading

People are naturally busy, and everyone has different schedules and things to do. So it's imperative that at this point you ask yourself, "What time do I have to dedicate towards trading?" That's going to help you closely focus on what your right time frame for trading is.

For example, some people only want to trade on a monthly basis, and that's all they want to trade. Their time frame dictates they will only put on a couple of trades throughout the month, let them play out, and at the end of the month, it will be time to take their cash off the table and move on.

Other people want to trade more often; perhaps two or three times a week. These traders are referred to as "swing traders" because they will put on a trade Monday morning and are out of it by Thursday. Still, other traders work every single day because they want that excitement and action in their lives. So you've got to determine for yourself what your own time frame is.

Personality Can Help You Determine Your Time Frame

Do you make decisions quickly? Can you make a decision instantaneously? Then maybe you're more of a day trader. Think about how you drive your car: are you always trying to pass everybody? Do you drive like you're in the final lap of the Grand Prix? If that sounds pretty accurate, then you're personality is more closely aligned with those who are day traders.

If you are a little more laid back and prefer to think things through before making decisions, you may not enjoy or thrive amid the quick pace of day trading. That's OK; there's a place for you too, and it's called position trading.

But Buy and Hold Doesn't Work

It's been said before that the traditional "buy and hold" investment strategy no longer works. So even as a long-term position trader, your time frame should be no longer than three months for any trade. The reason is that markets move so much faster than they used to and as a successful trader, you're going to need to be more proactive than reactive.

You've made a great choice in deciding that trading for active and passive income is the right business move for you, and stocks, options, and other open, public financial markets are a great way to get there. With Invest to Success' 10 Steps to Trading Success, you will learn how to position yourself to consistently make daily, weekly, and monthly returns on your portfolio with minimal risk, whether you're brand new to trading or a seasoned pro!
At Invest To Success, we provide training and educational materials designed to help the average trader (and even the complete newbie trader) become financially free within 2-3 years.
John Ondercin is the founder and Chief Trading Strategist at Invest to Success and has been teaching people how to cash flow their trading accounts for the past seven years.

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