Day Trading Risks & Stock Trading Disclosures
Warning – "Day Trading involves high risks and you can lose a lot of money including your total capital" day trading stocks.
Federal Trade Commission
The Federal Trade Commission has a free brochure, "Day Trading Ads: Cutting Through the Bull," and a web page that advises consumers:
There's no fail-safe way to day trade in stocks, commodity futures, options or similar investments without risk.
No computerized day trading system or advisory service can accurately predict what the price of a security, stock or bond will be on any particular day. Even day trading advisors with long histories of success can suddenly lose a fortune. Extravagant day trading profit claims and glowing day trading testimonials are likely to be exaggerated or totally fabricated.
Your best protection as a day trader or an investor is to know what you're buying, what the ground rules are when you buy and sell stocks, and what level of day trading risk you're assuming.
U.S. Government Required Disclaimer
Stock trading is not appropriate for everyone.
There is a substantial risk of loss associated with trading these markets.
Losses can and will occur.
No system or methodology has ever been developed that can guarantee profits or ensure freedom from losses.
No representation or implication is being made that using our system or the information in this website will generate profits or ensure freedom from losses.
Day Trading Risks
PLEASE READ THE FOLLOWING CAREFULLY:
THE RISK OF LOSS IN ELECTRONIC DAY TRADING IS UNLIMITED.
YOU SHOULD THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN CONSIDERING YOUR TRADER WELL BEING, YOUR TOLLERANCE FOR TRADING RISK, AND YOUR AVAILABLE TRADING FINANCIAL RESOURCES/NET WORTH.
We are not registered with the Securities and Exchange Commission nor with National Association of Securities Dealers nor with any other securities regulating body as a broker dealer, investment advisor or any such entity, as we do not provide any of these services.
We assume no responsibility for your trading results.
Past performance does not guarantee future performance and we do not make any performance presentations or guarantees. Based on my trading performance, you have a potential to reach similar performance. Will you I do not know. There are many factors that enhance and limit each trader's day trading potential for profits.
Any trading calls, demonstration or trading results produced by us presenting trades and using our methods, on this website or in any advertisement, brochure, or online demonstration, magazine, etc. are to be considered simulated trades for illustrational purposes only.
No trading system can guarantee profits.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE LIMITATIONS.
UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY.
SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
The host server for this website is located in Canada
IN CONSIDERING WHETHER TO TRADE OR NOT, YOU SHOULD BE AWARE OF THE FOLLOWING:
10 RISK FACTORS:
Day Trading RISK DISCLOSURE
Day Trading Risk Disclosure Statement – Rule 2361.
You should consider the following points before engaging in a day trading strategy. For purposes of this notice, a "day trading strategy" means an overall trading strategy characterized by the regular transmission by a customer of intra-day orders to effect both purchase and sale transactions trading in the same security or securities.
Day trading can be extremely risky.
Day trading generally is not appropriate for someone of limited resources and limited investment, or trading experience and competence, and low risk tolerance.
You should be prepared to lose all of the funds that you use for day trading. In particular, you should not fund day trading activities with retirement savings, student loans, second mortgages, emergency funds, funds set aside for purposes such as education or home ownership, or funds required to meet your living expenses. Further, certain evidence indicates that a trading account of less than $50,000 will significantly impair the ability of a day trader to win.
Of course, a trading account of $50,000 or more will in no way guarantee success.
Be cautious of claims of large profits from day trading.
You should be wary of advertisements or other statements that emphasize the potential for large profits in day trading.
Day trading can also lead to large and immediate financial losses.
Day trading requires knowledge of securities markets. Day trading requires in-depth knowledge of the securities markets and trading techniques and strategies. In attempting to profit through day trading, you must compete with professional, licensed traders employed by securities firms, Market Makers, and Hedge Funds.
You should gain the appropriate experience competence before engaging in day trading with cash.
Day trading requires knowledge of your brokerage firm's operations. You should be familiar with the firm's business practices, including the operation of the firm's order execution systems and procedures.
Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price. This can occur, for example, when the market for a stock suddenly drops, or if trading is halted due to recent news events or unusual trading activity, or as a result of big money "trickery".
The more volatile a stock is, the greater the likelihood that execution problems may be encountered. In addition to normal market risks, you may experience losses due to system failures – your system, your Internet Service Provider, and either or both the systems used trading NASDAQ and NYSE.
Day trading will generate substantial commissions, even if the per trade cost is low. Day trading involves aggressive trading, and generally you will pay commissions on each trade. The total daily commissions that you pay on your trades will add to your losses or significantly reduce your earnings. For instance, assuming that a trade costs $16 and an average of 29 transactions are conducted per day; an investor would need to generate an annual profit of $111,360 just to cover commission expenses.
Day trading on margin or short selling may result in losses beyond your initial money traded. When you day trade with funds borrowed from a firm or someone else, you can lose more than the funds you originally placed at risk. A decline in the value of the securities that are purchased may require you to provide additional funds to the firm to avoid the forced sale of those securities or other securities in your account. Short trading as part of your day-trading strategy also may lead to extraordinary losses, because you may have to purchase a stock at a very high price in order to cover a short position. Take opinion of a licensed financial advisor to know more about risks of engaging in day trading activities.
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