If you want to trade in stocks but can't keep up with the daily fluctuations, and don't want to engage in long-term investments, then positional trading could be ideal for you. Let’s understand positional trading strategies and how they may benefit your financial goals.
- What is position trading?
Of all the types of trading, position trading is the one with the longest holding times. Consequently, the profit potential is greater, but so is the risk. History is full of famous examples of great traders who made their fortune by implementing position trading strategies.
For example, in one of his latest newsletters, Joe Ross spoke of what is surely the longest example of position trading on record, which lasted almost ten years (from 1991 to 2000). The investor in question opened a long-term position in the S&P 500, which he held for a long period of time, by setting a trailing stop​​ that was triggered only when he felt that a good profit had been made, thus finally closing the position with a profit of 16 million dollars.
Another famous position trader was Philip A. Fisher, who, in addition to being a great investor and being followed by a large crowd of admirers, including Warren Buffet, made excellent investments, focusing on good companies with very encouraging data. In 1955, Fisher made a long-term investment in Motorola shares and held that position until his death at the age of 96.
- What is position trading?
- Positional trading strategies
- Features of a position trader
- Positional share trading
- Advantages of position trading
- Disadvantages of position trading
- 50-Day Moving Average Trading
- Pullback and retracement trading strategy
- Support and Resistance Trading
- When trying to ascertain support and resistance levels, the following three major factors must be considered.
- The most dependable source of support and resistance levels is historical pricing.
- Previous levels of support and resistance serve as indicators of future trends.
- Technical indicators that might provide dynamic support and resistance levels that fluctuate in response to the price of a certain asset.
- Breakout Trading Strategy
- Features of a position trader
- Trading breakouts
- Positional trading indicators
- Advantages of position trading
- Disadvantages of position trading