- Trends, Charts, Technical Analysis
- Various trading strategies
- How are shares bought and sold?
- How to find good stocks and much more
You can learn all these things through many posts, as well as you can understand intraday trading very well from YouTube or Paid courses.
Advantages of Intraday Trading
1. Benefits of margin
You can get a margin
up to 10 times by the broker intraday. That is, by investing Rs 1,000, you can buy shares worth Rs 10,000. Margin is a type of loan that a broker gives to you. After finishing the trading, you have to pay this money back to the broker. But the profit of Rs 10,000 is completely yours.
But if there is a loss in it, then your entire capital can also go. So my opinion would be that you should avoid taking a margin.
2. No risk of Overnight Position
In intraday shares are sold on the same day. This may be his biggest advantage. Because many times it happens that after the market is closed negative news comes about a stock. Then on the second day when the market is open, then that stock falls a lot as soon as it opens. There is no risk in intraday as intraday traders close their trades on daily basis.
3. Daily income
Intraday trading is a type of business. There is profit or loss in this business every day. Some traders run their homes by doing intraday trading.
4. Short selling
In intraday, you can also earn a profit from the falling price of the stock. If you think that the price of a stock may go down. So you can earn profit by shorting that share. The more the share price goes down, the more you will profit.
disadvantages of Intraday Trading
There are many reasons for LOSS in intraday trading
, if you do not pay attention to these reasons and do not rectify those mistakes then you will probably be one of those 90% people because it is true. that’s why know the intraday trading meaning properly.
As we have seen, margin can be profitable if the trade goes right. But if the trade goes wrong and you have taken margin, then all your money can be lost. Because the dealer/brokers have nothing to do with your profit or loss. He just wants his money back.
So in case of loss, you will have to pay back the money from your pocket to the broker.
Reasons for money loss in intraday trading
1. No money management
The first reason may be that before doing intraday trading, you are not able to manage your money well, how many trades you have to buy today, and how much quantity you have to trade. So that you often put more and more of your money at high risk and loss. that’s why I am saying understand intraday trading meaning properly and make your basics strong.
2. No risk management
The main reason for the closure of intraday trading can be your wrong risk management plan so that you keep taking risks on risk in the desire to make more profit and also drown your capital. that’s why I say again and again understand the intraday trading meaning properly.
3. sightless trading
When you raid the market without any thought, then you are not going to trade in the market, you are going to bet in the market, which is done blindly, in which your loss is almost certain. Therefore, in order to secure your money, you should take information about the market and about the basics of intraday trading.
Main factors of trading
A lot of details have been given about intraday in the given information. But when you start real trading then you have to understand many things, which really come in handy. The same factors and terms are explained below.
Margin or leverage is the amount lent to you by the broker as a loan. With this, you can trade on high volume even with less capital.
Actually, this is the same factor that makes Intraday Trading special from Short-Term Trading and Investment.
For example – You want to buy 50 stocks of smartime company and its current market price is ₹ 1000, but you have only 10 thousand rupees. Now the broker lends you 3 to 10 times margin i.e. an amount in this so that even with a capital of ₹ 10,000, you can trade 50,000 (50 * ₹ 1000).
In intraday, this margin is squared off when the market is closed.
Margins on the other side of the coin can also drain your capital completely –
Like you bought shares with a capital of 10,000 + a margin of 90,000 = 1 lakh with a value of Rs.
Now if there is a big fluctuation in the market and the stock falls by 10% then the End of the Day Square Off will be –
1,00,000 – 90,000 (Margin) – 10,000 (10% loss of 1 lakh) = 0
The only thing to do is that Intraday Trading is riskier than any other trading.
2. Limit order
When you want to buy or sell a share at a fixed price, Limit Order helps you to do so.
For example – you want to buy HDFC shares at ₹ 2345, whose current market price is ₹ 2350. So in such a situation, you set the Buying Price to ₹ 2345 using the Limit Order and as soon as a Seller is ready to sell at this price, then your Oder is placed.
3. Stop loss
When you are doing Intraday Trading and there is no loss, it cannot happen. Just as there can be profit, there is also the possibility of loss. But capital is exhausted by high loss, so stop loss becomes the main factor in reducing the loss.
With the help of this, you decide your loss in advance – making sure that you will not lose more than a certain amount.
4. Margin Intraday Square off
As I have told you earlier, during intraday trading you have to make your Net Position to 0 i.e. Square Off before the market closes (Square Off Time). If you do not do this, the broker will complete the trade on your behalf.
That is, if the shares have been bought earlier, it will sell them and if they have been sold before, will buy them. Where this process is known as Margin Intraday Square Off (MIS) because the margin provided by the broker is also squared off during this time.
Mistakes in intraday trading
The first biggest mistake in intraday trading that we often make while trading is not to follow any kind of system or rules or strategies and keep trading in the stock market in an arbitrary way or manner. Why do people not understand that without strategies, money cannot be made in the stock market? that’s why I say again and again understand the intraday trading meaning properly.
It is very important to have a good MINDSET for doing intraday trading, if you are trading today with PRESSURE to cover yesterday’s ones or trading in bad mood then it can make you face loss in trading. Maybe so that you do not look at the stock market again after losing money in the future, which is very wrong.
The third biggest mistake that we make during any trading is that we trade according to someone’s TIPS or ADVISE and you must know that without knowing or without hard work, you get heavy losses. Can and probably will be delivered.
Other trading methods then intraday trading
(1) Standard Trading
(2) Momentum Trading
(3) Swing Trading Learn about swing trading
FAQ ON INTRADAY TRADING
1. How long does it take to learn Intraday Trading?
Answer: It takes at least 2 months to learn intraday trading.
2. Can we start trading without a Demat account?
Answer: No you cant start trading without a Demat account because a Demat account is very important.