Top 5 Benefits of Intraday Trading

The intraday trading means “trading in the day” or “day trading”.  The intraday trading is one of the most excellent trading strategies in the stock market, which helps day traders to make money in share market of India. There are the lots of benefits of intraday trading, which helps a day trader to lead a successful life. Due to the numerous benefits of intraday trading, a number of people are doing day trading. For intraday trading, more youngsters are eager, because it is an easy, simple and profitable way of earning.

Top 5 benefits of intraday trading

A number of traders choose different types of trading according to their preference. There are lots of advantages and benefits of intraday trading over positional trading, which requires holding the stocks for a few days or weeks, while in the day trading does not need to keep the stock for a long time. The buying and selling of stocks will happen on the same day. There are many such reasons and advantages due to which most of the traders like intraday trading. Let’s know some reasons, which make intraday trading the first choice the traders.

1. It ends overnight risk

The greatest advantage or benefit of the intraday trading is that it eliminates the overnight risk for you. Here, you can close your position before the end of the trading day, due to which your profitability will not be affected by good or bad news and events occurring during non- trading hours.  For positional traders, there are lots of chances of disappear from profit due to the risk of any bad overnight event. In intraday trading, any tragedy or disaster in local or global stock markets can not affect your income for that day.

2. It decreases brokerage commission

Brokerage commission is 1/10th for day trading than taking delivery of shares. All the charges like stock transaction tax, stamp duty, service tax etc are applicable only on the brokerage, so you have to pay very little for the day trading. Taking delivery of shares involves the additional process of transferring the stock from the company to the demat account, which increases the cost paid through the brokerage. With the intraday trading, you can do a lot of trade by paying less commission, which is not possible in long term and positional trading.

3. Day traders can earn profit in any direction

A day trader can take the advantage of both growing and falling market. This advantage cannot be extended to long-term investors who hold their shares for a longer period to make more profit. Day traders can make profit by making small sales in falling stocks. On another hand, positional traders can only do small sales in futures, for which the higher margin is expected.

4. It gives high returns

If a good day trading strategy is applied with discipline then desirable profit can be earned in the stock market. To get excellent returns, it is necessary to learn the strategy to observe intraday market fluctuation.

5. It provides plenty of opportunities to learn

The intraday trading provides you extra opportunity to learn, test and apply different trading techniques in a short duration. Here, you can test yourself and trading strategies that best work for you, which chart pattern, is better for good results. It can make you more profitable.

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