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It seems people make a lot of money by ‘day-trading’ stocks. How does this compare to investing for the long-term as a strategy?



Our response:

Day trading means buying and selling investments – like stocks – within the same day. A day trader may base their decisions on financial analysis or speculation. It’s often high-risk and there’s no guarantee that you will make money.

There are many ways to invest. Generally, investing in the stock market for the long-term has been historically beneficial. This is because while share prices typically fluctuate up and down in the short-term, and sometimes by large amounts, the market has historically always recovered and trended upwards. By investing for the long-term, you are more likely to be able to weather “dips” in the market. Check out this Interactive Investing Chart to see how investments grow over time.

Before deciding which form of investing is right for you, take a moment to understand the risk of stocks and the risk-return relationship. You may also be interested to find out more about diversification, fees for buying and selling stock and making an investment plan.

If you need assistance understanding the different ways to invest and what suits your needs, speak to a registered financial advisor.

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