First Learn and then Earn
Earning money in share maket requires appropriate knowledge and experience, so it is highly advisable to gain adequate knowledge before start trading and investing in share market.
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What are Day Trading Strategies ?
Trading on opportunities
This is one of the very common trading strategies used by most successful traders.
Trading on opportunity means, trading based on any news or information that makes either sector or stock to move in either direction. If it is good or positive news then the sector/stock price will move up and if it is bad or negative news then the sector/stock price will go downward direction.
If the stock price is expected to move up then the trader can buy and sell and make profit. Traders can also buy Option CALLS or future derivative if the stock or Nifty is going up.
And contradictory if the stock price is expected to go down then the trader can do short sell (only in day trading) and then buy when the stock price goes down. Traders can also buy Option PUTS and short sell future derivative if the stock price or Nifty is going down.
In future derivative it is possible to short sell the contract and wait till the expiry (one, two and three month’s expiry contracts, are available in India). Nifty as well as stocks are having future derivatives.
In options also it is possible to short sell the CALLS and PUTS.
If the stock price or Nifty is expected to go down then the CALL can be shorted or PUT can be bought and if the stock price or Nifty is expected to go up then the CALL can be bought and PUT can be shorted.
To become successful trader the trader need to be always in touch with market and company news through either news channels or through news website.
Resources and How to trade?
Trading on Q1, Q2, Q3 and Q4 results
Q1, Q2, Q3 and Q4 results are one of the best opportunities to trade
Q1 - Result in April/May - for duration January to March
Q2 - Result in July/August - for duration April to June
Q3 - Result in October/November - for duration
July to September
Q4 - Result in January/February - for duration October to December
The companies listed on NSE and BSE are mandate to declare their performance for every quarter and the results duration and announcement period is as mentioned above.
If any particular company posts good quarterly results then it is quite expected for its stock price to go up, so trader can make use of it. On the other hand it is also observed that this uptrend in the stock price will not last permanent, most probably, in a day or two the stock price will come down. So trader who did not get opportunity to enter into buy trade then can plan to enter into short sell trade after one or two, need to watch the stock price continuously.
Short selling happens in only day trading (intraday trading), future derivative can also be short sell till their expiry date (one to three months expiry), in options calls and puts can be short sell.
If you want to learn more about options then please visit options section on our home page.
To become successful trader it is important to apply some day trading strategies. Trading strategies are nothing but simple ways to follow to get success in trading.
The following are few trading strategies
a) Trading on opportunities
b) How to short sell?
c) How to trade on Active stocks?
d) Trading on calls and puts
e) Overtrading - the risky trading
f) Minimizing losses
Trading can be day trading (intraday trading) and some trader do delivery based trading like buying shares and holding them and sell them whenever the stock price goes up (after calculating the brokerage and taxes) without waiting for particular time frame, so delivery based trading can be for days, weeks or even for months.
For trader the profit is only parameter and not any fundamentals of the company. Including stocks, trading also takes place on future derivative, options (calls and puts), commodities, currency etc but these all require other type of expertise.
Dividend, Bonus and stock split announcement
Mostly During the quarterly results the companies declare dividend payout, bonus payout etc and this brings positive movement in the stock price.
All the Quarterly results announcement dates will be available well in advance on bse site or else you can contact us.
Trading on News/Information
Any news/information that brings movement in the stock price would be considered for trading.
News like companies getting orders, mergers, acquisitions, stock split announcement, news of stake sale by promoters, change in management, company expansions announcement, pledging of shares, capacity addition plan etc.
All these news/information would bring movement in stock price so traders always keep close watch on such news.
The way to track all these is financial news channel, websites.
How to short sell?
Short sell is the trading method, in this process first selling of stocks at higher levels and then buying them at lower levels takes place.
Short selling happens in day trading (intraday trading) in stocks.
In Future derivative you can short sell and hold till its expiry which is one month to 3 months based on its expiry date.
In options also you can short sell CALL or buy PUT and hold till its expiry or short sell PUT or buy CALL.
The short selling is done whenever the trader expect for the price to go down.
Any bad news/information would send the stock price at downside.
How to trade on Active stocks
Trading on stocks which are already active is quite easy and mostly turns the trade into profitable.
Some Simple Factors to watch for trading.
1) Today’s top gainer may be tomorrow loser or again gainer.
2) Today’s top loser may be tomorrow gainer or again loser.
3) Trading on stocks in news ensure profits compared to any other technique. Because news makes the stock either to move up or go down.
Following are few resources where you can locate stocks for trading
Please see following subsection at Today’s Market Closing
How to trade?
Simple rule - In trading, small profits are taken and multiple trades are done, especially in day trading while in delivery based trading the brokerage rates are calculated and then over it small profits are taken.
Waiting for big profits in trading is not advisable because markets are always unpredictable so it can move at any direction at any time without anybody’s knowledge
Please visit below link to know how to do take small profit and do multiple trading.
As the information mentioned at below is related to day trading, this strategy can also be applied for any type of trading.
Trading on calls and put
Take content from following link
Overtrading - the risky trading
What is Over Trading?
Buying and selling of shares at big quantities by using margin amount is called over trading.
Basically brokers provide margin amount for day trading.
If you have Rs 25,000 amount in your trading account then you can trade till Rs 1 lakh (this is 4 times margin amount) or some brokers even provide higher margin amounts.
If you are new and not fully aware of market principles and strategies and start trading by using entire 1 lakh rupees then it is very risky and it is called as over trading.
We believe “over trading” is most critical factor among the day traders and over trading will lead you to losses if you don’t follow appropriate strategies or if don’t have experience.
Generally traders do over trading and get panic if the price moves against their trade and this panic generates fear in their mind and finally they square off the trades by accepting losses.
If you are very experienced then you can use margin amount with appropriate precautions.
We have noticed that some traders put all their savings money in trading which is also very risky and this is not at all recommended.
It is not possible to earn lakhs in a single day without knowledge and experience. So don’t try overtrading, it can wipe out all your money.
Above note is for new comers to share market and who are not fully aware of day trading.
If you want to test whether you are fully prepared for day trading or not then first do
paper trading practice. For paper trading please
The other way to do trading is, use only your amount (present in your trading account) and not margin amount and buy few shares and if that share price goes down then you can take delivery of those shares and sell later when the share price goes up. But if you use margin amount then you need to sell the shares on same day or some brokers provide few days period with some interest rates.
It is not possible to have all profitable trades in the share market and also it is not possible to get profit on daily basis. It is also not recommended to trade on daily basis if market is not giving any clear signal.
Sometimes due to unpredictable market the trader has to accept losses and come out of the trade and wait for next opportunity.
In trading accept fewer losses and come out of the trade and wait for next opportunity or for next day.
Some traders panic if losses happen and do more mistakes and hence again more losses. Patience is very key factor required in trading.
In share market the profits and losses are two sides of the same coin but at the end of the month/quarter/year the trading should end into profits.
Don’t wish to take profit every day because this will make the trader to do unwanted and forceful trades resulting in losses. Trading has to be done on opportunity basis and profits will automatically fall in.
At the same time it is not possible to get profits every day, some time we have accept losses for the day.
Stock to watch today for traders
Stocks for Today's Trading
Shares touching 52 week High and Low
Stock price movement based on news
Shares for trading with Resistance & Support
Realtime Future Derivative Stocks
Futures Derivative Gainers and Losers
After Market Hours
Positive Hot Stocks
Negative Hot Stocks
Shares under Upper & Lower Circuit Breakers
Top Ten Gainers & Losers with large volumes
Top volume surprises- Perfect for trading
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