What is a 'Swing'

1. A fluctuation in the value of an asset, liability or account. This term is most commonly used when referring to a situation in which the price of an asset experiences a significant change over a short period.

2. A short-term trading strategy in which a trader attempts to capture gains by holding a security for only a few days. Also known as "swing trading".


1. The volatility that exists in the financial markets can be seen easily when the price of a certain security undergoes rapid changes in value. These sharp shifts are often referred to as a swing. For example, it is not uncommon to see a major index swing from negative territory to positive territory just prior to the market close.

2. Swing trading is often used by individual investors since their small positions won't have a dramatic impact on the price of the security. On the other hand, financial institutions do not have the luxury of entering or exiting a position over a matter of days since the size of their orders can greatly influence the price of the asset.