Everyone has a different journey on how they became a trader and it’s eerily similar the struggles everyone goes through. It just shows you that nobody is born a trader, it has to be learned! The next few pages are things that I focus on daily, from my rules/guidelines that I have personally developed and work for me, charts from stocks that I will play any day that have good movement, to other educational things that have helped me along that way that may benefit you as well.
Education is Power – When I was a kid I was told if you learn 1 word/day you will expand your vocabulary. Here is a way to expand your trading knowledge 1 word/day. Click “Term of the Day”
What is a ‘Long (or Long Position)’
A long (or long position) is the buying of a security such as a stock or options with the intent that the price of that security will go up. This could be short term or long term it doesn’t matter, the term is still the same.
A long position is the opposite of a short (or short position).
What is a ‘Short (or Short Position)’
A short, or short position, is the “selling short” or borrowing of stock with the intent that the price of that security will go down. Depending on your broker you may or may not have shares available to borrow per ticker. In my experience the lower the float, the harder it is to borrow shares but there are brokers who specialize in this area. Taking a short position is much different when it comes to options.
What does ‘Float’ mean and ‘Outstanding Shares’
Shares that can be freely bought and sold by the public is called the Float. Outstanding shares refers to the number shares of stock that a company has issued. This number represents all the shares that can be bought and sold by the public, as well as all the restricted shares that require special permission/restrictions before being sold. Shares Outstanding is not to be confused with authorized shares. The shares Outstanding and Float can also change as the company may do secondary offerings.
What is ‘Secondary Offering’
A secondary offering is the sale of new or closely held shares by a company that has already been had an initial offering (IPO) to be traded on the exchanges. There are two types of secondary offerings, non-dilutive and dilutive. The one we are mostly interested in is dilutive as it involves creating new shares for public.
Read more: https://www.investopedia.com/terms/