How to Make Money With Day Trading Software - Is it Possible?

By Peter Skotnicky

Day trading software has made a huge change in how day trading works as a profession. While there have always been tools that make you money in stock trading, from ticker tape with constantly updated stock prices to telegrams and faxes with hot tips, what's happened since the dawn of the internet is that these techniques have reached more people (and the market has gotten considerably more complex as more financial instruments are devised by mathematicians.)

Day trading software is basically an automated information aggregator. The more sophisticated packages, like the Day trading program, pull in information from several market segments and run it into analysis tools, then compare it to algorithms, where billions of successful trades from highly trained professionals have been programmed in.

These include logical statements for why certain trades happened with certain market triggers, and aggregates of multiple trades to figure out which ones have, in retrospect, the clearest read on the market as a whole.

Since stock trading runs on volatility plays, the ability of the software to match market data to algorithms gives you a theoretical speed advantage; computers can compare data sets much more rapidly and efficiently than humans can. What's changed is that the computing power to do this has migrated from the server rooms of investment banks and into the desktop computers of average consumers who are just getting started into day trading.

And that's where the risk lies. While it's possible to make money doing stock trading, and it's possible for someone to make a lot of money doing it, it still requires judgment. While this software makes for a good analytical tool, and it will even make recommended picks for buy and sell orders, it's still using the canned judgment of whatever it was programmed with.

Markets are fundamentally chaotic, and there are going to be market parameters that go out of the boundary conditions programmed into this software. If you don't recognize what the software is doing, this can be incredibly risky.

We aren't saying don't buy the day trading software. Quite the contrary - it's an excellent analysis tool and a good enough automated trading program, and within the boundaries of what it 'knows' and can 'learn' from trading patterns, it's an excellent tool for you to expand your trading repertoire.

That being said, it's just a tool. It's not a sure fire winning formula - it will make some bad trades (and you or it will need to figure out why it made those trades). You still have to treat day trading as your job, and can't look at this program as something that will make you money while you're out on the golf course.

So, consider it, but make sure you understand the fundamentals of day trading before you put the day trading software to use. Treat it like you'd treat a chainsaw - it's a useful tool, and you can get a lot done with it, but it's also going to need awareness and judgment to use soundly.
Old school investing was only the beginning; with stock picking software available, investors are dominating the market without an ounce of sweat.

You can do the same by choosing a great software that can help you. Tackle the issues surround day trading by letting a professional software find the next big penny stocks for you.