The difference between Day Trading and Stock Trading 

 If you’re into trading, then chances are you must have come across the terms, “day trading” and “stock trading”. But what’s the difference between them and which one is right for you?

Fret not because in this guide, we’ll be taking a complete dive into the world of trading and answering all these questions. So buckle up and let’s get our bull run ready. 

What is Day Trading?


Day Trading is the act of buying and selling shares in the stock market. It involves exchanging stocks within a single day to profit from the volatility of the market. Those starting off in the trading business typically are attracted to Day Trading because of the high profits earned within a short period of time. 

What is Stock Trading?


While Day Trading involves a quicker paced approach to the stock market, Stock Trading is the investment of short term profits for gains over a long period of time. It is the buying and selling of shares in a company, where if you are the owner of a share in a particular company you own a piece of the firm involved. 

Both Day Trading and Stock Trading involve risks and dangers of losses, however, with the right understanding and education, anyone can become a successful trader. 



While both Day Trading and Stock Trading aim to make high profits, there are different targeted goals for each. When it comes to Day Trading, short-term actions are the main reasons for profits. Using charting systems and technical analysis methods, traders are able to make multiple trades in a single day. With Stock Trading, investors are considered shareholders in a company, and as a result, have to care about fundamental procedures and underlying operations that would benefit the company. 



Day traders have to put their focus on short time periods when trading. It’s a one Day Trading operation of buying stocks to sell them at an intended price and vice versa. Traders have to rely upon tools of technical analysis to detect trading opportunities strategically. Their time frame charts can range anywhere from one minute to sixty minutes. Stock traders on the other hand, have longer time frames. They hold their securities and sell their trades when the market suits their advantage, so the trading can go on for weeks, months, or even years. 



Day traders have the advantage to deal with hundreds, even thousands, of trades each year. Their goal is to maximize profits by quickly cutting losses and moving on to more trades. Stock traders, because of their involvement and share within a firm, have to avoid losses as much as possible to avoid company damage. As a result, they only trade a few times a year, buying and selling assets and then holding on to them for months.  



Danger, difficulties, and risks are a part of a trader’s life, regardless of the type of trading. However, day traders have a higher risk of loss as compared to stock traders. Typically, a trader’s lack of knowledge, unstrategic approach, and lack of patience lead to poor risk management. Stock traders invest in shares that can be held on to for a long time period which results in less short-selling, and as a result lower risks. 



Day traders make their profits by relying on technical analysis and charting tools. These help them identify opportunities for trade by looking at patterns in trading prices and predicting price moves on a short-term range. Day traders have to analyze long term performances, and are dependent on financial metrics that assess the performance of a company. They focus on fundamental analysis such as valuation, and keeping an eye out for news and updates on the stock market. 

Advantages of Day Trading

  • One Day Trading that requires a short-term strategy
  • Quick returns and huge rewards. A trader could make 10% daily as compared to an investor’s 10% yearly. 
  • The ability to work independently without having to report to a firm
  • Work from home thanks to the easy access to technology. 
  • Free resources are available online to help beginners go far and professionals even farther. 
  • Does not require a high level of education, and while formal educational requirements are recommended and may be helpful, they’re not necessary. 

Disadvantages of Day Trading

  • Requires a considerable investment in trading setups
  • Beginners have to compete with traders who often spend millions to gain trading advantages in the market 
  • Large amounts of capital are invested in an unpredictable market. As such, there is a high risk of loss due to the uncertainty. 
  • Learning to read charts and understand technical analysis may be a struggle for those starting off

Advantages of Stock Trading

  • The longer time frame allows traders to maintain a full time job in addition to their trading business because they do not have to constantly check their computers for fluctuations in the market. 
  • The less upfront investment is required
  • Greater potential for large gains if you sell your stock after a longer period of time
  • Various financial instruments allow the trader for a versatile option of investment such as bonds, shares, mutual funds, etc.
  • Low risk factor due to the market being unaffected by short term fluctuations 

Disadvantages of Stock Trading

  • The long trading timeframe can lead to demotivation and a lack of interest in investing 
  • Inadequate knowledge of the firm that a trader invests in can lead to major drawbacks. 
  • If a company fails to manage its profits and generate sales, investors experience the loss as well and lose money


If you’re someone that has a high tolerance for risk, Day Trading is for you. Moreover, if you have control over your emotions and are a patient person that has the extra capital to gamble, you should day trade rather than invest in a stock. 

Day trading provides you with the opportunity to be your own boss, and with the right market knowledge you can earn big profits in a short period of time. However, if you’re someone who has a full time job and doesn’t always have the time to analyze stocks on a daily basis, you should invest in Stock Trading. 

It is perfect if you’re a low-risk tolerance person with investments you can’t afford to lose, and an aim to grow your savings over time. 

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Malik Hamza
Articles: 20
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