A stock is held by position traders until an exit price is reached. The resistance that would cause the stock to retrace steeply or move sideways is the reason for the exit price. While position traders have higher points for each trade, they are also holding the stock for several weeks to months. This style of trading is slower paced than Swing Trading.

The ideal trading style for beginners is position trading. If you make a mistake on your entry, you can hold onto it. It is ideal for low capital base traders who can’t afford to buy expensive stocks. Many great bargains can be found when stocks form bottoms and the position trader can buy these stocks at very low prices and hold while the stock climbs. The beginner and low capital base trader can increase their capital with less risk. Options are riskier than position trading. If you are a beginner, we recommend that you start with position trading and then you can start trading options once you are consistently successful. It is wise to choose a style that will tolerate some mistakes without costing you your life savings because options are a do or die situation.

People with busy lives prefer position trading. If you hold the stock for long periods of time, position trading can be done with as little as one or two hours per week. You don’t have to study charts every night and you can enter a few stocks each month.

In all kinds of market conditions position trading can be lucrative. During the choppy sideways markets of recent years, it has been an especially strong trading style.

If you are a beginner, a low capital base trader, or a busy person, then position trading is the style of trading for you.