What is Intraday Trading: 11 Real Fact You Must Know

What is Intraday Trading? Today the stock market is not just limited to investing, rather Intraday Trading has become a popular option in which shares are bought and sold within a single day. Intraday Trading is for those who want to make profit from short-term price movements. In this blog we will understand what exactly Intraday Trading is, how it works, and what tips will be useful for beginners. And if you want to learn the stock market from the very basics, then click on this link.

What is Intraday Trading

Intraday trading means buying any stock in a single day and selling that stock on the same day. This is called intraday trading. If you do not do this and do not sell that stock on the same day, then your broker will sell that stock without your permission.

Intraday Trading VS Investment Which is right for you

Many people are confused about whether they should do trading or investment, so today I am going to tell you the advantages and disadvantages of both trading and investment.

Advantages and Disadvantages of Trading and Investment:- If you want to do Intraday Trading then it is very important for you to know Technical Analysis, without it you cannot do Intraday Trading but if you want to invest then it is important for you to know Fundamental Analysis. In Intraday Trading you have to buy the share on the same day and sell the share on the same day, you cannot hold it, hence the risk is very high in it, if that stock falls on that day, then you can incur a huge loss. Whereas this does not happen in Investment, in Investment you can buy the share whenever you want and sell it whenever you want, the risk is very low in it and in this you have to hold the share for the long term like 5 years or 3 years. In Intraday Trading you get profit quickly whereas in Investment you have to wait a while.

How does Intraday Trading work?

If you want to do Intraday Trading then first you have to select a stock, then you have to analyze the price movement of that stock, meaning you have to check the chart of that stock and check all the news related to the stock etc. When your analysis is complete then you have to buy that stock. But remember that you have to sell the shares on the same day you bought them, if you do not do this then your broker will sell those shares without your permission and in this case you may incur huge losses.

Things required for Intraday Trading

Demat & Trading Account:- If you want to do Intraday Trading in the Stock Market then the most important thing for that is a Demat Account. If you do not have a Demat Account then you will not be able to do Trading, hence you will have to open a Demat Account.

Market Knowledge & Strategies:- If you want to do entrepreneurship then it is important that you should have knowledge about trading, which means you have to learn technical analysis for it and you should have a strategy which is effective for it. If you do not have any one of these abilities then you may suffer a huge loss.

Risk Management:- Whenever you trade, you must place a stop loss, this saves you from making big losses in the stock market and you have to decide beforehand how much loss you can bear and you have to trade accordingly.

Advantages of Intraday Trading

Earning money quickly:- If you know Intraday Trading well then you can earn more money quickly through Intraday Trading. But if you are not successful then you can waste all your money quickly.

Taking advantage of price movement:- Through Intraday Trading, you can take advantage of the daily fluctuations in the stock market and earn good money. You do not need to worry much about the market whether there is a fall in the market or not.

Taking advantage of leverage:- Through Intraday Trading you can earn good profit even with less money.

Disadvantages of Intraday Trading

Above we have told you some about the advantages of Intraday Trading but we must also know about the disadvantages of Intraday Trading. As quickly as the profit is made in trading, the loss also happens equally quickly and most of the people incur loss in trading, therefore trading can prove to be more dangerous for a beginner.

Intraday Trading Tips

(1) If you want to do Intraday Trading then you must always trade with Stop Loss.

(2) For Intraday Trading, choose a stock which has some positive news and also keep an eye on the trend of that stock.

(3) Many people make losses in Intraday Trading because of not controlling their emotions but you should not do this, you have to control your emotions.

(4) You must do Paper Trading before doing Real Trading, by doing this you will learn to make a good strategy.

Conclusion

What is Intraday trading is an exciting and fast-paced trading strategy that is best suited for those who can actively monitor the market. But always remember that the risk in the stock market is as much as the reward. Therefore, intraday trading should be done only with knowledge and discipline.