Intraday trading is the most popular approach if an individual wants to make a wholesome livelihood from the stock market. Intraday trading is widely different from investing, as in the latter a trader has to wait for months and years for recording profits. In intraday trading, with meticulous handling, traders can record profit within a few hours and sometimes, luckily even in minutes.
With the recent advancements in technology and the internet, intraday trading Zerodha can be learned easily and handled even on cell phones, comfortably lying on your sofa sets at home.
What is Intraday Trading?
Intraday trading is a stock trading type where the buying and selling activities on a stock are carried out within a single day. Intraday trading requires humongous capital gains in intraday trading.
After understanding the elementary characteristics of Intraday trading and understanding its basic premise, the next step is figuring out the method to proceed with intraday trading zerodha. We present to you the step by step guide explaining the complete intraday trading procedure. This guide will help you begin intraday trading even with the best stockbroker in India.
Step 1- For beginning with intraday trading, one must have a trading account. Zerodha, 5paisa, Angel Broking are some of the best stock brokers in India, with close monitoring of market movements for recording gains. Traders with the minimum market knowledge and keen observation can record with which one can open a trading account. These discount brokers have more or less the same features but their brokerages might vary a little bit.
Step 2- A trader must possess a sufficient margin balance in his trading account. For the uninformed, the margin is the minimum amount required for trading. The margin amount varies from trade to trade including significant differences between regular and margin intraday square off-trade. There are major differences between both of these, in regular trade, a trader’s existing position is carried out to the next day, which is not the case with MIS trades as the positions of this variant gets squared off before the day’s end.
This is why the margin for MIS trades varies between the range of 4x to 20x which clearly depends on the stock’s expected volatility and nature. Margin imparts the trader with much-revered power of leveraging.
Step 3- Traders must have a clear idea as to what share/asset to proceed with for intraday trading on that particular day and separate those shares in a dedicated watch list. This step is of utmost importance as it is practically impossible to personally monitor all the listed shares of the BSE and NSE.
A well-managed watch list of selective stocks gives traders an opportunity to buy and moderate commodity stocks and gain maximum advantage from intra-day trading endeavors.
Many discount brokerage firms provide special amenities to stocks put under the watch list. They complement the star marked stocks with added attention which relives and lets you monitor other potential stocks. This is why it is advised to have a separate watch list.
Step 4- The next step is moving ahead with the share we desire to trade. After stock selection, we just need to put the stock in the pipeline for purchase. Now there is two way for profitable trading- market order and a limit order. If we proceed with the market order type then you’ll end up selling or buying the stock at the current market price. But with a limit order, one gets the luxury of fixing the price on which the deal has to be made.
The next important thing is choosing the order kind i.e. MIS order or normal order. A limit order has the exact margin as the current stock value whereas an MIS order has the margin requirement ranging between 5% to 20% of the quoted stock value.
Step 5- Now after finalizing the order, a trader must positively check the order book, that whether the order has been placed or not. One can check the same by visiting the order tab of their stock broker’s website. The order book has complete details of all orders that have been canceled, placed, or executed.
Step 6- This is the most important step for gaining maximum profit from your intraday trading expedition. An informed trader practices continuous monitoring of his stock positions. Traders must be ready to devote every single moment to reaping maximum efforts from intraday trading. You must always emphasize placing stop-loss limits for a trade option.
If an amateur trader positively follows the mentioned steps then he will surely have a rewarding and successful trading streak.
Conclusion:- Intraday trading has the potential of giving umpteen wealth to an individual provided he trades cautiously. While intraday trading, selling, and buying of the stocks are completed within a single day. Intraday trading is done for both the derivatives market as well as cash stocks. Traders must always have proper risk management tactics in place for all orders. Traders are advised to adhere to adequate trading guidelines and implement discipline for a long-rewarding career.
1.What is intraday trading?
1.In intraday trading, all the buying and selling operations are carried out within a single day.
2.Is intraday trading available for all commodities?
2.Yes, intraday trading is available for all commodities.
3.Is maintaining a watchlist necessary for intraday trading?
3.Maintaining watch lists aren’t necessary but it widely eases traders and helps them track the necessary stocks.
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