The faces of stock markets are many. Some have to do with buying and selling stocks and shares in the short term, and others are investments for the long term. You have to decide which is your extreme, and which kind of investment suits your individual financial aims. When investors emphasise the modus operandi of trading in the stock markets, they lay stress on delivery or intraday trading. Online trading platforms that are full-service platforms will offer up both ways of trading, and educate you on the basics of each. However, you should ideally educate yourself about the differences between the two.
The buying and selling of stocks within the day that trading takes place is called intraday trading. In such a course of activity, stocks are bought with the goal of making profits and not with investment in mind. This occurs when investors harness stock indices’ movements, meaning that the various prices of stocks are considered to earn profits from mere trading in those stocks. If you are wondering how to start trading in India in intraday trading, you must establish an online trading account with any of the online trading platforms, such as Motilal Oswal. Some of the platforms offered are exclusive to intraday trading and deal with orders that cater only to this kind of trading. Such orders are completed before the end of the trading day.
One of the commonest methods of trading in stock markets is delivery trading. As opposed to intraday trading, the way delivery trading works is by the involvement of a more focused intention of investment. Merely trading activities are not looked at, but rather, investment beyond trading is the goal. Consequently, investors hold stocks over longer periods, waiting for a good time to cash out and earn substantial returns. This involves a fair degree of patience on the part of the investor. In the process, there exist no constraints of time where the sale of stocks are concerned. The investor is only concerned as far as the stocks are delivered to any given Demat account, and this is accounted for as a delivery trade. You have to perform delivery trades with a Demat account as stocks bought will be delivered to such an account and stored. Online trading platforms are good places to start Demat accounts linked with trading accounts.
You know that intraday trading is completed within the span of any trading day. Typically, this means that every share purchased in a day has to be sold by the day’s end, before the markets close. If the sale of shares does not occur, they are squared off automatically at the market’s time of closing. On the other hand, in delivery trading, shares purchased can be kept longer periods to yield higher returns. Intraday trading gives you the opportunity to have capital accounts that are low and enables margin payments, but delivery trading needs total amounts for all related transactions.
Intraday trading is a good way to trade if investors can make value judgments of shares at short intervals. Several technical tools can assist you in predicting movements of prices in the short term. This is a key advantage of intraday trading. However, if you are one of those investors who can select shares on the basis of a company’s inherent value (like the price to earning ratio, book-value, etc.), then long-term investment is a good idea.
Intraday trading and delivery trading both have advantages depending on investors’ attitudes and goals. Open a Demat account with Motilal Oswal and explore different ways to trade. You can take advantage of great sources to help you determine your needs and the types of methods you wish to adopt.
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