Professional investors frown upon the desire for quick profits, especially from inexperienced outsiders. Statistics back up their opinion, as most traders lose money due to being over-leveraged and unprepared. High volatility, speculative approaches, and leverage pave the way for quick profits.
Options
Trading the rights to sell and buy instruments is less expensive than regular investing, allowing for leverage and higher profits. A stock option represents 100 shares, so a few percentage points of movement can make a bank.
Start by trading small options. Buying puts or calls 15 days before earnings are an easy way to make quick profits because anticipation tends to drive up stock prices.
Follow Smart Money
Institutional investors, financial professionals, and funds make well-informed decisions. This “smart money” generates higher trading volumes, which can be used as a signal. For quick profits, use volume indexes as positive or negative indicators.
Insider trading data from the SEC’s Edgar database, and following politicians’ portfolios at Capitol Trades or Smart Insider, can provide cues. Changes in a company’s institutional and internal ownership can also indicate future stock price movements.
Trading the COT Report
The weekly COT (Commitment of Traders) Report is a useful sentiment indicator for detecting trend reversals. Increased long or short positions in the US futures market could point to a shift in market participants’ interests. Many option and futures traders use it, particularly the Legacy and Currency Derivatives Report, to make quick and secure profits.
Daytrading
Intraday trading is the fastest way to make money in the stock market. With a small initial investment, sector-and-trend awareness, along with an understanding of market-moving forces and technical analysis, can yield significant profits in a matter of hours.
Volatility can be profitable, but stable stocks are safer, particularly for beginners. To succeed, pure luck is insufficient, but real-time stock market data is essential.
Margin Trading
Margin trading is highly lucrative by using borrowed funds from a brokerage firm to trade more shares than one can afford, thereby amplifying the profits. It requires a thorough understanding of risk management and the discipline to act accordingly.
Short selling can generate infinite losses, and a margin call can mean the end of a trading career. Even so, many professionals use it to pocket astronomical profits daily.
Scalping
Scalping generates quick profits from small price fluctuations, typically from instruments moving in a steady range. It’s a lower-risk strategy by not holding positions for too long and having a solid exit strategy before entering any position.
Even on quiet market days, there are several small moves to exploit with a direct access broker, real-time stock data, and an understanding of technical analysis. Heavy volatility and erratic markets are not suitable for this trading style.
Penny Stocks
With penny stocks, one might lose or gain a hundredfold of their investment in mere hours. This magnitude of growth is scarce in developed economies. Anything less than $5 is classified as a penny stock.
Pick penny stocks with high trading volume and good earnings growth potential. Take measures to avoid pump and dump schemes; don’t hold positions for long, always research the source of tips for potential conflicts of interest.
Cryptocurrencies
There are fortunes made and lost every day with cryptocurrencies. They have no intrinsic value, making them hyper volatile and offering opportunities for quick profits.
To give a bold example, Terra and Solana gained 9000% in 2021. These instruments are for high-risk-tolerance investors who take the time to understand market forces and quickly act on them.