Discipline is the most important trait for day traders, says stock trading educator Teri Ijeoma.
"The most important thing about day traders is having discipline," the founder of Trade and Travel told Yahoo Finance Live. "You have to be able to follow a trading plan," she said, adding that the "discipline to be able to sell or buy at the right time is important."
The S&P 500 (^GSCP) just capped its worst first half of the year since 1970 amid tighter monetary policy and fears of a recession. The downturn is a sharp reversal from 2020 and 2021 when the markets soared to all-time-highs during the pandemic.
Valuations are plummeting as the Federal Reserve continues its process to normalize interest rates and recession fears grow.
Ijeoma recommends sitting on the sidelines of a declining market for traders who are brand new to investing.
A lot of people in 2020 and 2021 were investing without any kind of knowledgeTeri Ijeoma
“If we're in a recession, the stocks can go lower. You may want to wait on the side, start saving up cash, and then get in at a better price,” she said.
Her day trading course has been taken by some 28,000 students. She says retail investors accustomed to the buy-the-dip and hold mentality are pivoting towards different strategies.
“A lot of people in 2020 and 2021 were investing without any kind of knowledge,” said Ijeoma.
“For my students, we talk about more advanced things like short selling and options trading. We're getting more people looking for more advanced tools with a more advanced trading environment,” she said.
Ines is a markets reporter covering equities. Follow her on Twitter at @ines_ferre