Active trading is a broad term that identifies people who look for short-term profit opportunities in trading securities on price changes. Many active traders do this full-time, while others use the strategies to augment traditional long-term investing plans.

Active trading strategies can be defined by how long (or short) the trader holds the security. This holding period ranges from seconds for short-term traders to months for position traders. In between these two extremes, momentum and swing traders catch and ride price movements.