Intraday Trading in the Indian Stock Market. A beginner guide to book the profit.

Intraday trading:
There are 03 types of trading in the Indian stock market: Long term, Short term and Intraday trading. In my previous blogs, I have covered the following topics on the stock market:
Blog topic	Published Date
(2024) Start trading in the Indian stock market and see a significant return on your investment from day one.	26 January, 2024
(2024) Beginner guide for trading in the US stock market and earn money online from day one.	10 April, 2024
What is the annual return (2023-24) of Nifty 50 stocks,  and how can we make a good profit now in the stock market of 2024-25?	05 May, 2024
Before we move further, First of all, we will try to understand the different types of trading i.e Long term, Short term, and Intraday Trading as below:
Long-term trading (Investment) This type of investment is safe if invested with the knowledge of the company. It is invested for a few months to a few years. Such investments are done for long-term targets like higher education, marriage, land or flat purchase, etc. Brokerage charges vary from one trading platform to another. Maximum, it may be  0.5%  per transaction. Some platforms also have fixed or slab rates.
Short term trading Short-term trading is done for a few days to a few months only. It is for short-term goals only. Brokerage charges are the same as for long-term investment. We sell the shares whenever we get a minimum 3-4% profit.
Intraday trading The stocks (shares) are purchased and sold on the same day. It means a transaction is valid for one trading session. These stocks are not for investment purposes. Stocks are not delivered to us. We do not get any ownership of the stocks. Stocks of different companies are purchased or sold in the morning with the expectation that their unit price will move in my favor before closing the trading hours. The timing of trading in the Indian Stock Market is generally 0915 to 1530 hours.  In this blog, we will try to explore the strategies to make a profit.

Some important guidelines for Intraday Strategies:

During trading hours (0900 to 1530 hours), you should be alert on the trading platforms.

Keep a sharp eye on the factors which will influence the market on the trading day.

Updated knowledge of the stock market daily is a must.

Watch fluctuations in the share prices throughout the trading hours.

Quick and sharp decisions are needed to sell or purchase the shares.

Keep watch on any positive or negative trigger for companies listed in the stock market.

Trades are automatically squared off on the agreed time with a broker. This trade cannot be carried forward to the next day.

Day trading is a full-time job. It requires in-depth knowledge.

Before opening the market, acquire sufficient knowledge of National and international news like Politics, Crude oil prices, the Indian stock market, the USA stock market,  US policies, the Ukraine-Russia war, the Israeli-Palestinian war, and other factors that may affect the stock market.

Keep in mind that the Investment and Disinvestment of Foreign Institutions in the Indian stock market largely affect the stock prices. If foreign institutions pour money into the Indian stock market, it increases the possibility of the stock market's upward movement. If foreign institutions withdraw money from the stock market, the chances of a negative market will be increased.

Crude oil prices and OPEC policies affect the stock market too much.

Gold rates are mostly inversely proportional to the Stock market. It means that the stock market prices will go up when the gold rate goes down.

Bank interest rates are mostly inversely proportional to the stock market, like the gold rate.

The impact of the announcement of Government policies and, the Union budget affects the related companies.

The impact of the USA market plays a significant role in the Indian stock market.

AI-based tools to watch the expected price movement during trading hours are good. Follow the reputed AI-based tools.

As a beginner,  select only the top 100 companies (NIFTY 100)  for intraday trading. These stocks will give you little profit but at the same time, the chances of losses will be little, and the amount of loss will also be small. Therefore you will be on the safer side.

Generally, it is expected that during the last 15 to 30 minutes of a session (1500 to 1530 hours), the price of a stock will continue to go down or up.

Always square off your all trading between 1500 to 1515 hours. Don't wait for the last 15 minutes (1515-1530 hours), these last 15 minutes keep for a cushion period to square off the left-out position. Some trading platforms like SBICap securities block the transactions before 1515 hours.

If the stock prices of all companies of a particular group (like PSU banks, IT, Private banks, Finance, Consumer goods, paints, etc.) are fluctuating, it means, it is not the reason for a particular company. Fluctuation after an hour or like that, will not be much more.

You may get a provision to convert intraday shares into delivery (short-term or long-term) shares.

Brokerage charges on Intraday trading:

Brokerage charges including taxes are almost negligible and vary from one trading platform to another. Maximum brokerage charges may be approximately 0.05% of the value of the transaction. Total brokerage charges (buy + sell) will be a maximum of 0.1% approximately.

When to buy the shares?

When it is expected that the share price of a stock is likely to move up, traders buy the low and sell the high as explained below:

Case-I Watch the stock prices of the top 100 companies (NIFTY 100) on the NSE website or app for 15 to 30 minutes in the beginning i.e. 0915 to 0945 hours. Watch the top 5 losers of the stock in NIFTY100. Now if you feel that one of the top losers is not showing sharp fluctuation and expect that the price of this share will go up now, select the such stock.  Prefer one which has high trading volume, because the chances for selling your stocks with profit will be high.  Buy the shares of the selected stock, approximately for Rs 5000. After buying the shares, it will be displayed on your trading platform. Now, put them on sale with a limit of 0.5%  profit. Example If you purchased shares @ Rs 1000 per share, put the limit on sell @ Rs. 1005 per share. Case-II If the share price is not increasing, it is going downward and showing a loss of 1% or more. Again purchase the second lot of shares at a market price of approximately for Rs. 5000. Now you have shares which are purchased approximately for a total of Rs. 10,000. Find the average purchase rate of a share. It will be in between the first and last purchase rates. It may be available directly on your trading platform or can calculate also, Now, put the sell order for all shares (first lot + second lot) with a limit price of purchase rate + 0.5% profit. Example  The first time you purchased the shares @ Rs. 1000 per share and the second time, you purchased the shares @ Rs.990 per share.  So your average purchase rate is 995 per share. Now put the order for sale with a limit of @ 1000 per share for all bought shares (first lot + second lot) of a company. Case-III You may continue this process to exit with profit.

When to sell the shares?

When it is expected that the market will go down, traders short sell, which means sell high and buy low as explained below:

Case-I Watch the stock prices of the top 100 companies (NIFTY 100) on the NSE website or app for 15 to 30 minutes in the beginning i.e. 0915 to 0945 hours. Watch the top 5 gainers stocks in NIFTY100. If you feel that in one of the stocks, the price movement is not sharp and the price of a stock will come down. Select that one stock. Prefer one which has high trading volume, because the chances for selling your stocks with profit will be high. Short sell the shares of such stock for approximately Rs.5000. After selling the stock, it will be displayed on your trading platform. Now,  put these shares on buy with a limit price for the profit @ 0.5%. Example: If you sold the share initially @ Rs.1000 per share. Now,  put the order for buying them with the limit price of @ 995 per share.

Case-II If you are unable to come out with a profit, and your first lot of sold shares is showing a loss of more than 1%. Sell another lot of shares of the same company approximately for Rs. 5000 on market price.  In this way, the average price per share will be in between the first and second selling price and it will be displayed on your trading platform. Now,  put the order for buying the total shares (first lot + second lot) with the limit to get a profit of 0.5% of the total. Example: You sold the second lot of shares @ Rs. 1010 per share for Rs 5000. The average selling price will be Rs. 1005 per share for all shares (first lot + second lot) costing about Rs 10,000. Now, put the order to buy the share with a limit price @ Rs.1000 per share for all sold shares (first lot + second lot).

Case-III You may continue this process to exit with profit.

When to book the profit?

The transaction may be completed for a minimum profit of 0.5%only.  Don't become greedy, book the profit @1% maximum. Otherwise, you may be trapped in loss. Therefore, please don't miss any chance to book the profit.

What will you do next if you come out with a profit in a stock?

If you exit with profit, again follow the same procedure. Select the other stock and initiate sell or buy as per the suitability for profit.

Don't start intraday trading for new stocks after 1200 hours, because you may not have sufficient time to come out with a profit.

After 1200 hours, you must try to come out from the stocks that are showing a loss, by selling or buying more as per need, but don't forget to put the limit order for profit.

What is auto squared off for Intraday trading?

If you buy the shares of some company and are unable to sell by yourself. At the end of the session, the trading platform will automatically perform the transaction for selling all such shares at the market price.  Similarly, If you sell the shares of a company and do not buy before the intraday session, the trading platform will automatically perform a transaction for buying all such shares at the current market price. Above both types of transactions are called auto squared off.

How much money is required to start intraday trading?

Beginners may start the intraday trading from  Rs. 100,000 (1 lakh).

With the help of margin, You may purchase the intraday shares for Rs. 5-10 lakh with your investment for 1 lakh only.

If you have surplus money and good risk capacity, you can go ahead with more money.

If you have Rs. 10 lakh or more. At a time you can opt for intraday trading for 4-5 stocks.

Trading platforms
For any type of trading in the stock/security market, you should require a trading account /Demat account on a trading platform.
Various trading platforms are available.  It is very easy to open a trading account.
Some of the trading platforms are listed below:
SBICAP Securities	HDFC Securities
Kotak Securities or Kotak Neo	Groww
Zerodha Kite	Motilal Oswal
5 paisa	Angel One
Upstox	Paytm Money
IIFL	Shoonya
ProStocks	Sharekhan
AxisDirect	Geojit
Fyers	Choice Broking
ProStocks

Final words

Always try to understand the bullish and bearish market.

Always keep in mind the advantages (Pros) and disadvantages (Cons) of Intraday trading.

Always keep in mind that there is no shortcut method of earning.

Intraday trading is a high-profit and high-risk business.

People who have a high-risk appetite should adopt intraday trading.

Daily at the end of the trading session, your loss or profit will be known to you.

There is no investment and no dividend in intraday trading.

Your money and profit or loss are always with you.

Disclaimer

There is no formula to give you a guarantee of profit.

The security market is always volatile in nature and subject to market risk.

Nobody can predict exactly the market price of a share

After studying the following and similar websites, with self-knowledge, the blog is written for educational purposes only to give some idea. There is no recommendation from my side. I am not a registered financial adviser. Always follow your decision to perform intraday transactions or take the help of an expert. The writer is not responsible (legal or otherwise) for any loss due to transactions in intraday trading. The blog is manually typed, It is not AI-generated. Any typographical error is regretted.

https://www.groww.in https://www.forbes.com https://www.motilaloswal.com https://www.5paisa.com https://www.kotaksecurities.com https://www.newindianexpress.com https://www.zerodha.com https://www.linkedin.com https://www.motilaloswal.com https://www.chittorgarh.com https://www.angelone.in https://help.indiainfoline.com https://www.fisdom.com

The end.