THE DAY TRADERS

An inside look at the new industry of day trading in the stock market. It’s one of the most attractive new options for the American entrepreneurial spirit. Day trading is an activity that does not require advanced education or superior intelligence, requires little initial investment (if you consider $40,000 and up little), and promises lucrative rewards for the work performed. For a lucky few, it can also provide immense payoffs. But that’s just the catch in this emerging field: that chance plays a major role in the potential outcome. The author, a widely published business writer (The Vandal’s Crown, 1995), is clearly excited by this new career path, although he does not indulge in the activity himself. He has presented a balanced report on the development of this kind of investment action, covering the legal, political, and technological changes that hastened its arrival. While sympathetic to the role of these new financial players, underdogs in the established world of stock investment, he doesn’t gloss over the pitfalls scattered across the day traders’ terrain. The main point, and a critical credo for aspiring day traders, is that the old rules of stock investment do not apply here. “It’s the markets on a subatomic level, where science contradicts itself curiously and everything you know is wrong. This is Extreme Investing.” Glued to computer screens, day traders place their bets on minute-by-minute fluctuations in stock prices, with profits and losses often coming from one-eighth-point movements. This is not exactly a guidebook for potential day traders, even though it contains valuable information, advice, and guidelines for successful involvement, because it also ruthlessly describes ripoff schemes, crooked operations, and a rising tide of concern about the risk of exploitation—not to mention the risk of failure. In the end, this is a cautionary tale that limits the potential of day trading success to a few hardy, well-prepared individuals.