“A Day Trader is an Investor who attempts to profit by making Rapid trades intraday”
– Investment Brothers
If you are looking for Intraday Tips | Commodity Tips | Stock Future Tips | Equity Tips | Live Nifty Tips | Nifty Future Tip chart | Sureshot Nifty Tips | Option Intraday Tips | BTST / STBT Tips | Stock Cash Intraday Tips and want to become a Millionaire overnight then this is not the right place for you.
We are against Intraday Trading and we don’t encourage the same. We do not recommend intraday trading of any sort.
Why are you against Intraday Trading?
A simple understanding of Intraday trading is to do rapid trades within the time limit of a day and even the brokerage would encourage you by giving enough credit limits for the intraday trading. You get a higher margin for a Trading account. Brokerage trading for day trading is very less compared to delivery based trading. Also, they believe that they do not want to carry the positions overnight as the stock or index could open gap up or gap down due to some event.
Now when one says rapid how rapid it can get is the question. With the advent of Algo trading, black box trading or computer trading the definition of rapid has changed. Quants in trading have taken a leap forward were successful human trading get very tough. It has reduced the success ratio of successful intraday trading to 2% – 3% which is a very low probability of success after working so hard.
We are not against intraday trading but let’s leave that to quants. If you are good at quants then you should definitely go for it. Let us also know we are very much interested. Perhaps the resources required for quant trading is not in the reach of most. It is also known as High-Frequency Trading.
Professional trader who do intraday trading usually deploy only 2% of their capital and most importantly you have to spend most of your time in front of the system. Intraday trading historically has given huge return which rarely gives an opportunity for wealth creation. If you spend some time over internet browser you would get enough strategies but occasionally do they give a consistent return over a long period of time.
“99% of Traders Lose Money while doing intraday Trading.”
What is MIS in trading? What is a margin in trading?
MIS is otherwise known as Margin Intraday Square off. Which means that the derivative which you are buying or selling today should be squared off today before the closing of the trading hours.
The actual cost is much higher and usually, most of the brokers give very high margin for intraday trading. This is the main source of luring the customers. The reason behind this is that low cost of investment required.
The usual margin required to purchase the stock might range from Rs. 4 to Rs. 5 Lakhs. Whereas for the derivative the margin would range to Rs. 80,000 to Rs. 1,20,000. At the same time the Intraday Trading the amount would range to Rs. 30,000.
This margin given by the broking houses give more purchasing power to the individual. Also, the probability of succeeding in the intraday trading is very challenging.
What is the meaning of delivery in trading?
When the derivative traded for intraday is changed into delivery the margin automatically change. Every intraday position can be converted into delivery before the cut off period provided there is enough margin available. Even the delivery stock can be sold and be treated as an intraday trade.
Delivery Trading is another concept which many take advantage of. Derivatives can also be used to hedge your position in the stock trading. That is the primary use of the future e.i. to hedge the entire position with the least amount possible. So that it brings you to the position you were before the loss.
Intraday Trading is a full-time activity.
You have to sit in front of the system the whole day and not be distracted at all. Indeed, this is the reason that the intraday has been replaced with other technological advances.
Come back here and tell us about the before-and-after. I bet you’ll have something to say!
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