News Trader

AAA

DEFINITION of 'News Trader'

A trader or investor who makes trading or investing decisions based on news announcements. Economic reports and other news can have a short-lived affect on particular markets. News traders try to profit by predicting how a market will respond to particular news. The old saying "buy the rumor, sell the news" means that rumors have one effect on a particular trading instrument's price movement, and news can have an opposite effect.

INVESTOPEDIA EXPLAINS 'News Trader'

News traders rely on short-term reactions to news to drive the market in a particular direction. News traders can look at historical data to predict how future news can affect prices. By becoming familiar with certain markets, news traders can make a guess as to whether a stock or other trading instrument will increase or decrease in price following a news report. Often these price moves happen within an extremely short period of time following the news; therefore, news traders must be quick to respond if they hope to capture profits. This also means that news traders must be one of the first to receive breaking news.

RELATED TERMS
  1. Herd Instinct

    A mentality characterized by a lack of individual decision-making ...
  2. Material News

    News released by a company that might affect the value of its ...
  3. Day Trader

    A investor who attempts to profit by making rapid trades intraday. ...
  4. Rally

    A period of sustained increases in the prices of stocks, bonds ...
  5. Active Investing

    An investment strategy involving ongoing buying and selling actions ...
  6. Fundamental Analysis

    A method of evaluating a security that entails attempting to ...
Related Articles
  1. Trading Strategies

    Day Trading Strategies For Beginners

    From picking the right type of stock to setting stop-losses, learn how to trade wisely.
  2. Trading Strategies

    Introduction to Types of Trading: Fundamental Traders

    Learn about the different traders and explore in detail the broader approach that focuses on company-specific events.
  3. Active Trading

    Manipulating Facts to Fit a Theory: A Dangerous Trading Practice

    This practice is common with experienced and new traders, and it can lead to huge losses. Find out how to avoid it.
  4. Forex Education

    Forex: How To Scalp Fundamentally

    Learn why event-driven scalping in the currency market involves balancing fundamentals with technicals.
  5. Forex Education

    Mastering Short-Term Trading

    Making money in a pressure-cooker environment is all about minimizing risk on hot picks.
  6. Active Trading

    Fundamental Analysis For Traders

    Find out how this method can be applied strategically to increase profit.
  7. Active Trading Fundamentals

    20 Rules To Trade More Professionally

    Break free from the pack and join the professional minority with an approach that raises your odds for long term prosperity.
  8. Chart Advisor

    Commodity Traders Are Using Momentum To Profit From These Stocks

    Active traders are drawn to momentum strategies. These momentum winners of 2015 are worth a trader's second look.
  9. Trading Strategies

    Day Trading: Top Scenarios To Take Profits

    Three ways to take profits while day trading, based on price movement and what the asset is doing that day.
  10. Chart Advisor

    These 4 Swing Trades Could Place You in the Money

    Take advantage of moves both higher and lower with swing trades based on trend channels.

You May Also Like

Hot Definitions
  1. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  2. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  3. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  4. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  5. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center