Most people, when they think of active trading, think only of day trading. In fact, there are several diverse ways to actively trade on the market. Each is distinct and takes a special skill set. Active trading is certainly more complex than passive trading or investing and is not, as they say, for the faint of heart.Related: ROBO OR HUMAN?Active Trading DefinedActive trading involves buying and selling securities for the short term. The idea is to profit from the price movements that take place in a brief period – days, weeks or months, versus those that take place over years, otherwise known as buy-and-hold.As opposed to buy-and-hold strategy, active traders believe they can beat the market by taking advantage of short-term price fluctuations in stocks. The idea is the same as with buy-and-hold – buy low, sell high. It’s just done over a much shorter period.Day Trading As noted above, day trading is the most well-known form of active trading. Day trading involves buying and selling securities within the same day. No position is held overnight. Most day traders are professionals known as specialists or market makers. In recent years day trading has become more popular through electronic trading with regular every day novice investors. The major markets for day traders are stocks, forex and futures. Each involves a distinct, specialized type of security. Stocks are the most well-known with forex involving currencies and futures often involve commodities or indexes. One isn’t better than the other – it’s a matter of preference and your ability to play in your chosen marketPosition TradingIn some ways position trading seems more like a buy-and-hold strategy and not active trading. However, position trading, when done correctly can be a form of active trading. Position trading does use longer term charts – daily to monthly – along with other methods to determine the trend of the current market direction. Position trading can last for several days up to several weeks or even longer. Position trading is a form of trend trading or trying to determine the trend – up or down – and riding it to a profit. The idea is to identify the trend, take a position and exit when the trend breaks. Volatility is not a friend to position traders generally.Swing TradingSwing traders also watch trends and when the trend breaks, take their turn. Typically, at the end of a trend there is a certain amount of volatility as the new trend attempts to establish itself. Swing traders enter the market to buy or sell as that price volatility sets in. Swing trades are usually held for more than a single day but for less time than a trend trade. Swing traders often develop trading rules or algorithms designed to identify when to buy or sell a security based on either technical or fundamental analysis.Related: TOP TECH STORIES FOR 2017Scalping Scalping is unique and requires almost constant attention since it is one active method that involves quick moves in and out of the market. The basic strategy behind scalping is to exploit the price gaps caused by bid/ask spreads and order flows. Scalpers try to make the spread or buy at the bid price and sell at the ask price, so they can pocket the difference between the two price points. Scalpers hold their positions briefly to decrease the risk. Also, scalpers don’t try to exploit large moves or move high volumes of securities. Instead they try to take advantage of small moves that occur frequently to make many small profits more frequently.