Intraday Trading Basic Strategies

Intraday trading strategies is usually adopted by traders who have time, experience and extra money to invest on daily basis.

Before understanding basic strategies of intraday trading, you must know what is intraday transaction.

Let us take a simple example of a small trader. Assume a trader saves money cutting off his extra expenses while curbing overheads. This trader later purchases 100 shares of Anonymous Banking Services Company in the morning. The trader then sells the shares of the Anonymous Banking Services Company on the same day itself before the closure of the stock market. Here, the trader completes his intraday transaction by squaring off his position in the same trading session.

This overall transaction of buying and selling same day itself is called as intraday trading.

Squaring off or Square off trading is an option considered by the trader to achieve immediate intraday profits from the sell of the stocks.

Strategies to Earn Profit in Intraday Trading

  • Brokerage fees paid in other types of stock transactions is higher while in intraday trading it is very low. Negotiating for large stocks in paying lower commission helps in managing bottom line marginal profit at the end of the day. Smart strategy is to take benefit of this low brokerage in intraday trading which is mostly 1/10th in comparison to positional trading.
  • Another way to earn more in intraday transaction of stocks is maintaining discipline. Devoid of greed while keeping track on hike of stock prices help in closing the sell in profit. If large sum of money is involved, consistent rise in a day seldom happens so after couple of surge points, making intraday sell is recommended to lower the risk of losing it all at end of the day.
  • Keeping track on the company affairs helps a lot. Following their vendors, stock trading options and their future projects helps in understanding the market impact in the next morning of the stocks. Smart research for Intraday trading prevents risk of investment.

  • Smart Intraday traders utilise two options to make daily profits. One option is to buy and sell the stocks on the same day. Another method is opting for short sell and later covering the position. However, there is a high risk involved in short selling strategy, it is purely based on the speculation on the decline of a stock or other securities that you do not own. Mostly, experienced traders dwell into this predictive method of short selling.
  • Another strategy adopted by smart traders are provisioning money for the 30 days. The 30-day plan help in understanding the allocation of funds required for the next days of trading in case losses occur for consecutive days in a week.
  • Keeping spare capital for contingency losses is also another strategy to keep options open for earning profits in intraday transactions of new stocks.
  • Research, time and patience to follow different companies and sector is very important to make sustainable profits in intraday trading. A trader can become investor. Intraday online trading is a good learning curve to become large stock market investor from trader.

You can download trading app here.