Intraday traders, whether seasoned or inexperienced, face volatility that long-term investors do not. Because you execute all the transactions in a single day, you are exposed to more risk. However, with the right information and a reliable online trading app, an intraday trader may make significant profits.
What is Intraday Trading?
Intraday trading is the purchasing and selling of equities on the same day. Suppose Ms. Amruta purchases shares in a company. She must clearly state ‘intraday’ in the trading platform’s gateway. Intraday trading is sometimes known as ‘Day Trading’. Share values fluctuate during the day, and traders aim to profit from these movements by purchasing and selling shares on the same day. Intraday trading occurs on the same day before the market closes.
For example, suppose the stock commences trade at Rs 1000 in the morning. It quickly increases to 1050 within an hour or two. If you bought 1000 shares in the morning and sold at 1050, you would make a profit of Rs 50,000. This is known as intraday trading.
Best Intraday Trading Tips
Here is an intraday trading guide with strategic advice and useful tips:
Choose Liquid Stocks
Intraday trading refers to the purchase and sale of equities on the same day. This method requires a high level of market liquidity. As a result, one crucial aspect to remember is to trade large-cap stocks rather than small- or mid-cap companies. You should also avoid intraday trading with a single stock and instead seek to diversify your position across several equities. This type of diversification can help you establish a balanced intraday trading strategy, while also reducing risk.
Strict Entry & Exit
During intraday trading, numerous traders fall victim to a buyer’s remorse, which causes them to quickly rethink their decision after purchasing a stock. Buyers begin to assume that they have made a poor purchase, and these fears cause them to make rash and incorrect judgements. As a trader, you may avoid this misconception by agreeing on an entry and exit price before commencing the transaction. These predetermined prices help you to maintain objectivity and eliminate unneeded uncertainty.
Set a Stop Loss
During day trading, the stock you’ve picked may decline instead of rising. In such instances, the key question is how low you would allow the price to fall before selling the shares. Choosing a price that you consider as a square-off position is an important factor to remember. This str might help you minimise your losses and serve as a safety net.
Timing
It is critical that you carry out your intraday trades at the appropriate moment. Many traders advise against taking positions within the first hour of trading. This hour is regarded to be quite volatile. Thus many traders take positions after noon.
Emotional Trading
It is time-consuming to predict the stock market. You will frequently make selections about the intraday trading strategy you want to implement based on market analysis. However, once you start trading, the market may go in the other direction. During such instances, you must remember not to challenge the market or become obsessed with your analysis. A better approach is to sell your stock as soon as it hits the stop-loss level.
Study the Market
When you’ve decided on the stocks you want to trade, do your homework on the firms involved. Reading information on the firm will help you understand how market circumstances affect its shares. You should also keep an eye out for mergers, acquisitions, dividend payments, and other similar developments. These events can help you stay updated and fine-tune your timing.
Choosing Right Platform
Choosing an intraday trading platform is quite important. BlinkX offers an intraday platform that lets you to trade online, via the smartphone, or over the phone. BlinkX has a team of highly trained analysts and provides daily suggestions intraday stocks for today. You can find them in the web stories section on its online portal. The recommendations will assist you in selecting the best stocks based on your trading strategies.
Conclusion
To thrive as a day trader, you must understand how to choose stocks for intraday trading. People frequently fail to profit because they do not choose the right stocks to trade. Day trading, if not properly handled, can have serious consequences for one’s financial well-being. So, using the above intraday trading methods and ideas, traders may minimise risk while earning significant profits.
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