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Which is Better Intraday or Swing Trading?
Intraday Trading Profits Intraday trading is purely a buyers market though you play in a high risk zone, you can make small trades number of times in a day and build profits. Is intraday trading profitable? Is a splendid question because the stock markets (NSE/BSE) encourage different kinds of tradRead more
Intraday Trading Profits
Intraday trading is purely a buyers market though you play in a high risk zone, you can make small trades number of times in a day and build profits.
Is intraday trading profitable? Is a splendid question because the stock markets (NSE/BSE) encourage different kinds of trades like swing trades, and F&O trades.
These trades are more comforting and give you as a seller, a risk free zone to make decent or more money. Still, I recommend you Intraday trading, just check below.
Intraday trading sets a fixed timeframe in a day for trading, so you must condition your mind to execute your trade plan before you trade.
In case you are unable to meet your favored stock price you can extend your business day to next day, but that comes under delivery trading.
Here too, you will face umpteen hurdles and sometimes take you closer to losses than profiting. However, let us discuss whether intraday trading is profitable or not?
Yes, follow the steps mentioned below to make the profits to a decent level.
Steps to Get Closer to Profitability in Intraday Trading:
First,
Write your goal-set and do not change your trade plan of the day in any circumstances.
Second,
Adopt stop-loss techniques to avoid loss when you place a put option.
Third,
Set a control on your emotions and never let sentiments rule you.
Fourth,
If you are a beginner, then start with an initial investment of INR 1,000. And, if you enter into a loss it can be added to your learning experience.
Fifth,
Most of the stock brokers provide margin capital to trade intraday, and you can claim up to five times your trade capital.
Although it is risky you can lay hands on, when you have acquired sufficient practice in day trading.
Note:
Margin trading allows you to trade more capital in trading though you haven’t more of it.
For instance, you have set aside INR 1000.00 to trade, then you can invest in stocks up to INR 5000.00 and the balance INR 4000.00 is borne by your stock broker.
This technique can increase your profitability with less investment on your part.
Sixth,
Before you begin to trade, select the right stocks and create a good portfolio picking out of prospering sectors.
Seventh,
Profitability:
Remember, when you trade you will be subjected to expenses from different quarters, stock broker, income tax department, and your debts for trade capital.
Your profitability shall be an outcome of total earning ( income) – incurred expenditures.
You can make a rough calculations on profitability, check below:
Intraday Profit = ( buying stock price – selling stock price)
For instance, you buy for ₹1000 and sell the stock for ₹1100 then the profit earned is ₹100. But, it is not your actual profit, you will have to deduct all the expenses.
Therefore,
Actual Profit = profit – ( brokerage charges – Income tax deduction)
In detail,
Brokerage charges = intraday brokerage + STT( .025% on the sell side) + transaction charges + GST ( 18% ( brokerage + transaction charges))
Transaction Charges = ( NSE: 0.00325% BSE : Flat rate/trade INR 1.50, clearing charges INR 0.01/trade.
Intraday Income Tax Deduction:
Up to INR 2,50,000 , tax is nil
Between INR 2,50,000 to INR 5,00,000, 5% income tax will be levied.
For INR 500000 to INR 1000000 , 20 % income tax is applicable.
For income above, INR 10,00,000, 30% income tax is applicable.
See lessWhat is the Total Value of Indian Stock Market?
Total Valuation of the Indian Stock Market Media reports claimed that Indian stock market had touched an all time high valuation of $3.8 trillions by the end of the year 2023, thus making it to be the fifth largest stock market in the global scenario. Stock experts say that the stock market has tripRead more
Total Valuation of the Indian Stock Market
Media reports claimed that Indian stock market had touched an all time high valuation of $3.8 trillions by the end of the year 2023, thus making it to be the fifth largest stock market in the global scenario.
Stock experts say that the stock market has tripled in 3 consecutive years since March 2020.
With the global presence of G20 in India, and the visits of US President Joe Biden, and UK PM Rishi Sunak has brought about a noticeable change in the Indian Stock Markets. And, the reasons for the increase in the high valuations of the Indian Stock markets is summerised in this manner.
Indian stock markets validation proved to gear up the post covid 19, with more retailers participating in the buying and selling sessions and incidentally, the stock market valuations tucked $3.8 trillion USD. With the recent G20 summit, the market sentiments took a positive note and the summit resulted to encourage foreign direct investors buying.
Outcome of the G20 Summit:
In New Delhi, the members did differ in the issue of ongoing war between Ukraine, and the West Sanction on Russia.
Certain issues like the rail-port economic corridor that is likely to connect India-Middle East-Europe and agreement on the global biofuel alliance has encouraged investors to bet in the stock markets.
The foreign portfolio investors began to buy Indian stocks for six consecutive months, with equity assets worth ₹ 1.31 lakh crore accumulated in 2023.
The inflation had hit in the month of August 2023, the Centre for Monitoring Indian Economy (CMIE), supported by the Economic Outlook, said that consumer sentiments had affected the stock market by 1.5 percent decline in August 2023.
As the annual festive season has just begun, the economy could worsen as you will observe a surge in shopping.
The Indian stock markets rallied faster as the corporates could make impressive earnings, and several sectors could show an upward trend in economies. These sectors reflected financials, auto, consumer goods, and domestic growth.
To keep the inflation under control, the Reserve Bank of India, RBI, has kept the repo rates unaltered, and this was in reaction to the inflation figure. In July, the consumer price index, CPI, the inflation figure was an all time 15-month high (7.44percent), which became +/- 2 percent higher than the RBI set threshold of 4 percent.
However, the experts say that the retail inflation in the specified range of (7% to 7.4%) should not become a troublesome factor to the stock market investors.
US Stock Market Opening and Closing Timings
US Stock Market Timings - Dow Jones, NASDAQ, NYSE Are you stationed in an India Geographic location? You can still do trading with International Markets and earn your profits comfortingly. If you feel that cutting across the national boundaries can enable you to make good money in trading then youRead more
US Stock Market Timings – Dow Jones, NASDAQ, NYSE
Are you stationed in an India Geographic location? You can still do trading with International Markets and earn your profits comfortingly.
If you feel that cutting across the national boundaries can enable you to make good money in trading then you need to know the stock exchange timing.
Here, when you plan to conduct trading in the US context you will require to know the details that specify the timings of stock exchange trading.
If you aren’t aware, then let me tell you the way you witness in India (NSE/BSE), you will observe NYSE/NASDAQ in the USA.
Note:
Both the stock exchanges ( NYSE/NASDAQ) have the same IST for India and they have been derived by converting the Eastern Time to Indian Standard Time.
About NASDAQ
NASDAQ is the first automated exchange in the world, with its business operations opened in 1971.
Nasdaq comprises 2,500 listed companies, the most sought for, stock market indexes, and stands a reference for the US and Other global economies.
The Nasdaq focuses on the technology trades, listed with 500 domestic and foreign companies.
About NYSE
Started on May 17, 1792, with 24 stock brokers signed up for the Buttonwood Agreement and the New York Stock Exchange began with five securities, two were bank stocks, and three government bonds.
The stock exchange began to merge with participants like American Stock Exchange, Euronext and later NYSE Euronext was bought by Intercontinental Exchange (ICE) in 2013.
A year later, Euronext completely merged with Intercontinental Exchange, ICE through initial public offering, IPO, and subsequently ICE held the ownership of the NYSE.
In the USA, as said above, NYSE/NASDAQ makes an International presence, and stock brokers, investors, traders across the globe enter into, to engage into the stocks buying/selling activities.
In a stock exchange scenario, three activities play a prominent role, they are pre-market trading hours, normal trading hours, and after-hours trading.
Sectionally, each timing represents a specific activity, defined by the respective stock exchanges.
When you decide to conduct trading in the stock markets of the USA, you will have to check for the International Standard Time, IST. Only in this timing, you will be able to seek access with those specified stock exchanges (NYSE/NASDAQ) opened up for International trading.
As you align and trade at these stock exchanges, you must know three important time frames introduced to participate in pre market trading hours, normal trading hours, and after trading hours.
NYSE/NASDAQ hold the same timing to interact during trading hours, after trading hours, and pre-market trading hours.
For pre market trading hours, the allotted time frame is between 01:30 pm to 07:00 pm, IST at NYSE/NASDAQ, therefore you need to connect online in this period.
For normal trading hours, the allotted time frame is between 07:00 PM and 1:30 AM, IST at NYSE/NASDAQ, so you must maintain an online connectivity to conduct trade.
For after market trading hours, the allotted time frame is between 01:30 am to 05:30 AM, IST at NYSE/NASDAQ, therefore, you can make online interactive sessions with the stock exchanges, if you obtain permissions.
Stock Exchanges (NSE/BSE) Timings in India:
In contrast to the US stock trade environment, you will find pre open session runs between 09:00 am to 09:15 am at NSE/BSE.
Likewise, the normal trading session runs between 09:15 am and 03:30 pm at NSE/BSE. And, the closing session is between 03:40 pm and 04:00 pm at NSE/BSE.
The time difference between Indian Stock Markets and US Stock Markets is about 09:00 hours and the US lags almost a half-day behind the Indian stock environment.
What is the Best Time Frame for Intraday Trading?
Best Time Frame Chart for Intraday Trading in 2024 One important aspect of a successful day trader is selecting the right time frame chart. Yes, choosing the right time frame chart is a game changer. The time frame chart you choose can significantly impact your trading strategy and decision-making pRead more
Best Time Frame Chart for Intraday Trading in 2024
One important aspect of a successful day trader is selecting the right time frame chart.
Yes, choosing the right time frame chart is a game changer.
The time frame chart you choose can significantly impact your trading strategy and decision-making process, and ultimately it results in your profitability.
Out of my trading experience, I will share the practical reasons behind choosing the right time frame chart and by the end, I will share the best time frame chart for day traders.
Understanding Time Frame Charts
Before getting into the main topic, let beginners understand what is time frame chart.
Time frame charts represent price movements over a specific period, such as minutes, hours, days, or weeks.
Each candlestick or bar on the chart displays the opening, closing, high, and low prices within that time frame.
Different time frames reveal different levels of price detail, ranging from minute-by-minute fluctuations to broader trends over several days.
How to Choose the Right Time Frame for Intraday
The best time frame chart for intraday trading depends on various factors, including your trading style, risk tolerance, and market conditions.
Here are some common time frame options and their characteristics. Choose the right time frame that suits your goals and strategies.
1-Minute Time Frame Chart:
The 1-minute chart provides detailed price movements and is suitable for scalpers who aim to capitalize on small price fluctuations within minutes.
Traders using this time frame must react quickly to market changes and closely monitor their positions.
A little negligence may lead to huge losses within seconds. Sometimes that may lead to profits also.
Who Can Choose This Time Frame: Scalpers, Professional Traders, Gamblers.
5-Minute Time Frame Chart:
The 5-minute chart is the most used time frame by day traders in India. It gives a better understanding of the marketing movement and helps identify the day’s trend in the first three candle sticks.
Who Can Choose This Time Frame: Day Traders (Beginners & Professionals)
15-Minute Time Frame Chart:
The 15-minute time frame chart provides a broader perspective while still capturing intraday trends.
Who Can Choose This Time Frame: It is suitable for traders who prefer slightly longer holding periods and want to avoid excessive market fluctuations.
30-Minute Chart:
The 30-minute chart smoothens out price fluctuations further, making it suitable for swing traders looking to capture intraday trends lasting several hours.
This timeframe is not suitable for day traders.
1-Hour Chart:
The 1-hour chart is favored by swing traders and those who prefer holding positions for longer periods.
It filters out short-term fluctuations and helps identify significant trends. This timeframe helps swing traders understand the actual trend of the market.
Practical Example:
Let us consider two traders, each using a different time frame chart for intraday trading:
Trader A:
Utilizes a 5-minute chart for intraday trading. They focus on short-term price movements and aim to capitalize on quick momentum shifts.
Trader A identifies a bullish reversal pattern on the 5-minute chart, indicating a potential buying opportunity in a stock.
They enter a long position based on this signal and set a tight stop loss just below the recent low.
As the price goes up, Trader A exits the position with a profit before the end of the trading day.
Trader B:
Now let us see how Trader B acts using a 15-minute time frame.
Trader B Prefers a 15-minute chart for intraday trading. Trader B identifies a stock that has been steadily climbing on the 15-minute chart throughout the morning session.
They wait for a pullback to a key support level and enter a long position, anticipating a continuation of the uptrend.
With a longer time frame perspective, Trader B holds the position for several hours, eventually exiting with a substantial profit as the stock reaches its intraday high.
From my experience, Finding the best time frame chart for intraday trading requires careful consideration of various factors, including trading style, risk tolerance, and market conditions.
Rather than implementing others’ strategies, It is always best to establish your own strategy and time frame for a better result.
Experiment with different time frames to find the one that aligns best with your trading goals and preferences.
For me, a 5-minute time frame chart works best for intraday.
See lessWhy Most of the People Fail in Stock Market?
I Lost all my Money in Stock Market Yes, I lost all my money in stock market, but How did I come back and become a profitable trader? Go through the below-lines, it's not advice but my journey. Losing hard-earned money in the stock market can be hurting, but it is essential to approach the situationRead more
I Lost all my Money in Stock Market
Yes, I lost all my money in stock market, but How did I come back and become a profitable trader?
Go through the below-lines, it’s not advice but my journey.
Losing hard-earned money in the stock market can be hurting, but it is
essential to approach the situation with a clear and rational mindset.
Here is my advice from my personal experience on how to move on after losing all your capital in the stock market.
Take a Deep Breath and Stay Calm:
It is very natural to feel upset after a significant loss in the market. Take a moment to breathe and calm your emotions. Panicking can lead to compulsive decisions, which may lead to additional losses.
Analyze the Reason Behind the Loss:
Evaluate the extent of your losses and understand what went wrong. Examine the trade thoroughly that took you to losses. Learning from mistakes is a great step for future success.
Review Your Strategy:
Review your trading strategies & do back test on paper trading websites. Consider whether adjustments to your strategy or risk management practices could prevent similar losses in the future.
Seek Professional Guidance:
Consider consulting with a stock market professional. They can provide valuable insights, and guide you on potential adjustments to your strategies.
Come up with a Realistic Plan:
Develop a step-by-step plan to rebuild your investment portfolio over time.
Educate Yourself Further:
Take this opportunity to improve your knowledge of the stock market. Educate
yourself on different investment strategies, risk management techniques, and
market trends.
There are many free online learning platforms to learn the stock market like YouTube Channels, Free e-books, Websites, etc.,
Continuous learning plays a major role in becoming a successful trader.
Implement the above steps and give it a try. You deserve it.
See lessWhat are the Best Banking Stocks to Invest in?
Best Banking Stocks to Buy in India Investing in banking stocks can be a good idea, as banks play a major role in the Indian economy. Here are some best banking stocks to invest in India. Note: The stocks suggested below are as per my research & analysis, please don't make blind investments withRead more
Best Banking Stocks to Buy in India
Investing in banking stocks can be a good idea, as banks play a major role in the Indian economy. Here are some best banking stocks to invest in India.
Note: The stocks suggested below are as per my research & analysis, please don’t make blind investments without your own research and analysis.
There are many websites to do fundamental & technical analysis to do proper research, consider visiting those sites before investing.
1. HDFC Bank:
HDFC Bank is renowned for its financials, efficient management, and wide range of services across the country.
It has shown consistent growth over the years and it is one of the heavy-weight banks in the indices. The following table gives a quick review of its financials.
2. State Bank of India (SBI):
SBI is one of the largest and oldest banks in India. It has a vast network and a strong brand presence of Indian origin.
If you want to invest for long term in the banking sector, then SBI is also a good choice after HDFC. The ROCE of SBI is slightly lower than HDFC Bank but it gives a good dividend yield.
Those who are looking for more dividends can opt for SBI rather than HDFC.
3. ICICI Bank:
ICICI Bank is known for its diverse product offerings and extensive network. The following table gives a quick review of its financials, market cap, and current market price.
The dividend payout in ICICI Bank is much less than SBI & HDFC banks but the ROE is as good as HDFC Bank.
You can also consider ICICI Bank for long-term investments.
4. Axis Bank Ltd:
Axis Bank is known for its growth-focused approach and it has become one of the top priorities when it comes to banking. With an attractive user interface & responsive mobile application, Axis Bank offers a hassle-free experience in banking.
Analyze its performance in retail and corporate banking in the below table. The dividend yield at Axis Bank is very low compared to the above-listed banks, Axis Bank is not a top priority for those who look for dividends.
Kotak Mahindra Bank:
Kotak Mahindra Bank has been expanding its market share and enhancing customer experience. Consider Kotak Bank when you want to diversify your portfolio in the banking sector.
With its poor dividend yield, Kotak Bank is not a top priority but definitely it is among the top 5 banks in India.
Note: Before investing, research each bank thoroughly, its fundamentals, loan book quality, technical analysis, and market trends.
Analyze the economic environment and policies affecting the banking sector. As we know any economic news in India affects the banking sector first.
Consider diversifying your portfolio by investing in a mix of banking and non-banking stocks to lower risk.
Example: Invest 50% of your capital in Non-Banking & 50% in Banking sectors.
See lessWhat are the Best Penny Stocks to Invest in 2024?
How to Invest in Penny Stocks Investing in penny stocks is too riskier than day trading, so it is important to invest with calculated risk. The following are the must-follow rules before investing in penny stocks. 1. Research: Research the company's financial growth, management team. Look for transpRead more
How to Invest in Penny Stocks
Investing in penny stocks is too riskier than day trading, so it is important to invest with calculated risk.
The following are the must-follow rules before investing in penny stocks.
1. Research:
Research the company’s financial growth, management team. Look for transparency and credibility in the management operations.
2. Track Record:
Look for a consistent track record of earnings and growth. Avoid stocks with a history of losses or poor financial performance.
3. Study the Industry:
Focus on rising sectors with growth potential. Companies in these sectors may have better returns.
4. Volume and Liquidity:
Choose the stocks that have decent trading volume to ensure you can buy and sell easily. Low liquidity can make it hard to exit positions when your assumption go wrong.
5. Risk Management:
The golden rule in stock market is “Only invest what you can afford to lose“. Penny stocks are highly volatile, risky and can result in losses. Diversify your investments in multiple sectors.
6. Watch Updates:
Get updated with latest news and updates related to the companies that you have invested in. Breaking news can bring huge volatility in any stock.
If you are not an expert in research and analysis of stocks, it is better to seek an advice from stock market professionals. Don’t invest blindly.
Happy Trading. Thank you.
See lessHow to Invest in the Indian Stock Market?
First of all bring a clarity on how much money you want to invest in the stock market. It is important to invest only what you can afford to lose, and maintain a diversified portfolio to control losses when the market goes against your view. Based on your research, and fundamental analysis choose thRead more
First of all bring a clarity on how much money you want to invest in the stock market. It is important to invest only what you can afford to lose, and maintain a diversified portfolio to control losses when the market goes against your view.
Based on your research, and fundamental analysis choose the stocks that may perform well according to your analysis. Diversify your investments across different sectors like banking, infrastructure, IT, etc.,
Do not forget to keep an eye on your investments. Stay updated with the latest news and important announcement dates, and economic news. Adjust your portfolio as per the market trend.
Invest in the stock-market in the long term perspective to lower the risk.
Consider consulting a financial expert to get a second opinion.
Don’t forget that investing in the stock market involves risks, and it’s important to make proper decisions and be patient to achieve your financial goals.
See lessWhat are the upcoming IPOs in India 2024?
Upcoming IPOs in India 2023 Name of the Company Start Date Close Date Share Price (Rs) Lot Size Karnika Industries Limited IPO 29th Sept 2023 5th Oct 2023 76.00 1600 Vishnusurya Projects and Infra Limited IPO 29th Sept 2023 5th Oct 2023 68.00 2000 Plada Infotech Services Limited IPO 29th Sept 2023 5Read more
Upcoming IPOs in India 2023
What is Shooting Star Signal in Stock Market?
How to Buy Stocks using Shooting Star A shooting star is a particular pattern that was identified on a candlestick chart. Below lines help you to identify the shooting star signal and how to take position based on the signal. How to Identify Shooting Star Signal: A shooting star signal looks like aRead more
How to Buy Stocks using Shooting Star
A shooting star is a particular pattern that was identified on a candlestick chart.
Below lines help you to identify the shooting star signal and how to take position based on the signal.
How to Identify Shooting Star Signal:
A shooting star signal looks like a inverted “T”. It has a small rectangular-shaped head at the bottom (representing the opening and closing prices of the stock) and a long tail above (representing the highest price during the day).
Meaning:
The shooting star pattern suggests a potential trend reversal in the stock’s price. When it appears after an uptrend, it’s a sign that the stock might start going down.
Sign of Weakness:
The long tail indicates that even though the stock opened at low and there was buying interest, it couldn’t maintain the high price. This shows weakness and potential selling pressure.
Pattern Confirmation:
To confirm the pattern, traders usually wait for the next candle to happen. If the price goes lower than the shooting star’s closing price, it strengthens the direction that the stock might be heading for a decline.
Action to be Taken:
Traders might use this pattern as a signal to sell their stock. It is advisable to put stop-loss order to limit losses.
See less