What is Intraday Trading
Intraday trading, as the name suggests refers to the trading system where you have to square-off your trade on the same day. Squaring off the trade means that you have to do the buy and sell or sell and buy transaction on the same day before the market close. Intraday Trading is also referred to as Day trading by many traders. In Intraday trading , stock actually does’nt come to your demat account. Therefore , you need on trading account for intraday trading .
If you have bought 100 stocks of ABC limited during the open market hours,then you have to sell the same no. of stocks of ABC limited before market closure.Same is the case if you have sold the stocks,you have to buy the same quantity of the stock you have sold earlier.
Brokerage charges for the stocks traded under the day trading segment are very less than Delivery segment. High Margin is available for Day trading. They do not want to carry their positions overnight as the stock price might be impacted due to some other event and open with a gap up or gap down the next day.
Some traders focus on very short term and exit the position once they reach minimum level of profit.Such traders usually rely on Volume of transactions to make a substantial profit.They carry out multiple buy and sell trades and sometimes exit the position within minutes.
-Some traders rely on the trend for Intraday trading and usually are much more patient and make fewer transactions.
-Few traders resort to Intraday trading only in the case of some major event when a particular stock is supposed to go up or down based on some event.