Intraday trading used to be the exclusive domain of huge financial institutions, high-net-worth people, large mutual fund companies, brokerage firms, and other similar entities. In the year 2022, any person or corporation, regardless of their money or investment size, may invest or trade in stocks. Online brokerage businesses such Motilal Oswal make trading simple by providing free online broking account opening services. To get the best start in the realm of gravity-defying profits, read our essential guide to day trading for novices.
Basics of Day Trading
Buying and selling stocks on the same day is referred to as day or intraday trading. Day traders have the option of buying early and selling later, or selling first and buying later. When the market is bullish, they purchase, and when it is bearish, they sell. In the stock, foreign currency, and F&O markets, day trading is particularly popular. In the stock market, day traders look for liquid, highly volatile momentum stocks and enter or leave at the best possible time.
Day traders often use a lot of leverage. While leverage might help them boost their profit margin, it can also put them in a lot of financial trouble if the deal goes against their projections. Day traders must be eagle-eyed since they must analyze news and charts on the go.
In the stock market, there are three sorts of traders: fundamental, technical, and news-based. Fundamental day traders use fundamental research to uncover opportunities. Technical day traders analyze a stock's momentum and execute precise trades using technical indicators. News-based day traders, on the other hand, listen to or read the day's main news and trade the stocks that are most likely to be mentioned in it. Macroeconomic data, business events and earnings, sectoral news, interest rates, and general market sentiment are also monitored by news-based traders.
The stock market swings as a result of the aggregate feelings of traders and investors. Some traders, for example, may see an opportunity and pour money in, while others may smell danger and withdraw money. Due to the erratic volatility of stock values, day traders strive to make a profit.
What Are the Best Ways for Beginners to Get Started with Day Trading?
To operate as a day trader, beginners would require a Demat and trading account. Fortunately, Motilal Oswal offers qualifying investors free Demat and trading accounts. To open an account and begin trading, you must send your PAN card, Aadhar card, and a selfie image. You may use the account to trade commodities, currencies, futures, and options in addition to stocks. Motilal Oswal also has a margin option to help you maximize your earnings.
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