What in the world is real time investing and is it a smart strategy to use?
If you intend to implement this type of investment strategy you will need nerves of steel and/or a significant amount of antacid medications so that you don’t get an ulcer.
The term real time is exactly what it means, real time, or almost instantaneously knowing what the price of a stock or other commodity is selling for at that very moment. A buyer buys or sells shares of a stock based on the price at that very moment. Most read outs of a current individual stock price are delayed by as much as twenty minutes. This delay could represent an incredible amount of loss or profit depending on the direction the stock goes in that twenty minutes.
The type of stock trader that implements real time investing is someone that buys and sells shares of a stock several times in a day as it goes up and down in price. That is why the exact price at that very moment is so important to them. Even several seconds or a minute or two could mean a significant amount of money.
Stocks go up and down based on a variety of factors. The very first factor is supply and demand. The easiest way to make sense of this is that the more demand a stock has the higher the price generally goes. And conversely, the more supply, or less demand, it has it would generally sell for less. Of course, something has to generate a demand for a stock like the company sales are exceeding the projected amount. Or perhaps, the company is expanding into another market. On the other hand, maybe a news report was just released mentioning the company produces a product that may be defective and should be recalled.
What makes real time investing stressful is that there are many, and I mean many, factors that drive a stock share price up or down. If you are not following the company, or companies, really close real time investing is not a wise investment strategy to implement. When to buy and when to sell in those seconds that are ticking by quickly can mean a lot of money lost or gained. You must have a stomach for this style of trading, or you will go bonkers.
Unless you are an expert stock market trader, I would stay a long way away from being involved in real time investing. Leave it for the ones that do this for a living.
The biggest problem with this type of trading is that anything can drive the price of a stock up or down. Politics can have a huge impact on the stock market. The threat of a Presidential scandal. The President exchanges Tweets with a foreign nation. A terrorist attack in, or outside of the United States. All of them can have an impact on the stock market. That is why real time investing is so risky and should only be implemented by someone with the capital to be able to take a loss.
Thank you and may God bless you!