Intraday trading –Quick and Fast way of trading

Intraday trading refers to the wrap-up of trading on the same day.  It means that buying and selling the stock in a single day before the market close. In more simple words, settle your whole transaction on the same day.

 Let’s understand Intraday trading with an instance.

Suppose you buy a stock at Rs 500 and sell it for Rs 550 on the same day your earnings per share will be Rs 50 directly on the same day.

In stock market, trades can be done intraday and a second is long term investment. In Intraday trading, one can hold share just for same day, in long term trading share can be hold for the long-time. There is nothing wrong in go for intraday trading.  Only important thing to keep in mind, try not to take risk more than 2% of your trading capital on each trade. Moreover, invest only the amount that you can afford to lose. An unexpected action can wipe out your whole investment in a moment.  Indeed, you can avoid loss in trading if you trade with proper risk management. Intraday trading is the finest way to have trading in stock market for whose People who don’t have endurance and who’s who can’t wait long months for the outcome. It is not compulsory that a stock which is weak today while trading might be weak next day as well, simultaneously if a stock is strong at present might not be strong tomorrow, in this volatile market situations keep changes.

We list out some important tips and suggestions while trying out intraday trading;

Choosing best Broker for Trading Account- Selecting broker to open Demat or trading account is the first and basic step before jump in stock market. Market has flood of brokers and that provide us enough option to choose best one.

Study basic of intraday trading strategy- it is important to understand the basics of the stock and prepare a list of trendy stocks and debt stocks then choose right one. Be aware with important terms such as; short selling, bull market, entry, exit, stop loss, different charts, graph, pattern, etc.

Listen to Stock Market Expert-always consider the expert opinions. CNBC and Zee business channel telecast programs on the stock market situation regularly to update investors with market current situation.

Choose extremely liquid shares- prefer to trade in index-based stocks, large-cap, which get traded in large degree every day. So that, in end of the trading session you got an ideal position to wrap for a day.

Stop losses to have impact- Stop losses is important triggers for selling shares. Let’s suppose you buy 10 shares of tata at Rs 500 each and set a stop loss of Rs 450. In case, if the share falls to Rs 450, your shares will be sold instantly. In this way, your losses will be curtailed even if the share drops to Rs 400.

Buy Low Sell High- simple and basic rule you need to apply while trading is to buy a share at the lowest price and sell it at the highest price to make maximum profit.

Analyze the stock market performance on daily basis. Keep an eye on market to understand the nature of market regarding performance of share.  You should be capable to understand the market behavior due to different news triggers.

Fix entry price and target levels- beforehand, fix your target level and entry price. Often, psychology of the buyer changes which could obstruct with his decision and push him into selling too quickly even if the price moves up slightly. This might cost him the chance to fully profit from the upside. Therefore, set-up price &target and stick to it.

Start with Minimum Investment-if you are novice or inexperienced trader, it is better to begin with minimum investment. Later, once you get the right idea and direction to trade you can take a big risk as well.

Don't run against the market trend- in case, the market doesn’t move as per your expectations, don't try and be a contrarian ever. Even sophisticated expert and analysis fail to forecast which way the market will move.

Quit if you are not getting profit- even after lots of try and bad luck you unable to make money then quit instantly to avoid big loss. And understand stock market trading is not right for you.