Volatility is an Important Aspect of Short Term Share Trading: I realised early in the game of share trading that my trading style called for volatility. Since my capital was limited I was playing with leverage, be it with CFDs or warrants. Everyday that ticks by, holding the CFD or the warrant costs me interest. To limit my interest costs I needed to find stocks that were trending and were volatile enough for me to pocket myself some profit. You can find some of my target list of stocks to trade in this target list. According to CMC markets records BHP has been the most traded stock on their platform for a few months running now. The reason is that this stock is cheap enough to trade with and it is highly volatile.

Now, I’m not speaking for everyone here. Everyone has their own scenario, everyone has different goals. You may be trading penny stocks. So from what I’ve heard, point and figure charting works well with those types of companies because of the lack of their liquidity. Ask me what point and figure charting is and I wouldn’t have a clue since that isn’t my trading style. All I know is that it has naughts and crosses indicating a price rise and price fall in that time period’s trading. If and when I do start to trade those stocks, then it would be essential for me to know.

So, the reason why I look for stocks with high volatility in my share trading is because it fits with my trading style - limiting my interest payments due to my short term trading style.