In financial markets, “risk” refers to the uncertainty around the returns on an investment. It’s the possibility that the actual return on an investment will differ from its expected return, which could result in either a financial loss or lower-than-expected gains.
In the context of day trading, risk refers to the potential for financial loss on a trade or investment within a short time frame, usually within the same trading day.
Unlike long-term investing, where you might hold assets for years, day trading involves buying and selling financial instruments like stocks, options, or cryptocurrencies within the same day, often within hours or even minutes.
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