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Vissarion Ignatov
Vissarion Ignatov

How To Make Money In Intraday Trading

Are you one of those traders who have bought some stocks on the advice of someone else and waited for months and years to recover the cost? Such a herd mentality is not the way to be a successful trader or an investor. As per the experts, stock market trading can be quite risky, but one can act smartly to earn some quick bucks. Traders who are new to trading always have a question as to how to earn money from/in stock markets. As usual, the road to making money is never simple (unless you have won a lottery or inherited huge sums), and you require a certain degree of skill and acumen to win over the stock market. There are several strategies that seasoned investors apply, and techniques of trading they follow. Intraday trading is popular with a number of traders who tend to profit from intraday trading.

How to make money in intraday trading


One has to admit that there is an aura of mystery around the stock markets, and many do have an assumption that they can earn a lot of money by trading in stocks. To start with, traders who are new to stock trading need to start with intraday trading or day trading as it is popularly known. To achieve success in intraday trading one needs to be aware of some simple practical and psychological intraday trading tips which one can acquire with experience. As with any trading techniques you try, intraday or day trading requires patience.

So, how does intraday trading work? As per the experts, intraday trading is not ideal for everyone as it needs the traders to have a practical approach. Emotional factors too play a very important role in earning profits from intraday trading. If you are wondering how to make money in intraday trading in the shortest time possible, it is important to understand that there are no shortcuts and one can earn a good deal with research and experience. You must do your background work thoroughly well before you venture into intraday trading as this is a short-term trading strategy. It requires traders to step into the markets quickly and make rapid exits at the end of the same trading day.

Day trading does not help one get rich overnight. Many of the traders start intraday trading with an assumption that they can generate good money by making profits with just a single trade. But this is practically not possible and is not real as well. Experienced traders will attest to this. If you wish to earn a good intraday earning, then as a trader you need to study and dedicate yourself and learn with experience. Intraday traders need to put in efforts for months so that they can understand the markets to generate profits.

Traders who study markets can generate good profits in intraday trading. Traders can start with reading markets and keep themselves updated with both domestic and international markets. They can also read about company updates, government updates and so on. These are those factors, which will affect the direction of stock markets and this is what the trader needs to concentrate on. Traders also need to dedicate time to studying the stocks and shares of individual companies. Having a good grasp of which stocks are liquid enough to offload within a day is a good way to ensure that intraday trading works for investors. You may start with a few trading days that make you run into losses, but this should not put you off. Rather, you should learn from your experiences, and note why and where you faltered.

You may have heard that intraday traders in India, or anywhere else for that matter, make huge profits from a single day of trading. That may be true in many cases, but you should be aware of the fact that traders make profits by undertaking several reliable strategies and make precise notes on daily price fluctuations in the markets. The intraday stocks always move based on the market sentiment and hence if you have to make profits in intraday, the trade has to be based on the movement of the stock market. For example, if the market is bullish, then buy and sell a few times to earn small profits rather than waiting for that big move. Similarly, if the market is bearish, you can short sell and buy at the lower levels to gain some small profits with 2-3 trades. Market sentiments always rely on the news, and you may earn rewards if you keep a track of news and events that may affect sentiments of the market on a particular day.

Never wait to generate huge profits in just a single trade; instead plan multiple trades and earn small profits. Many times, traders tend to overtrade, and they end up in losses. When it comes to intraday trading, no one has the control over the movements of stocks, and hence if the trader waits too long and the direction of the stock reverses, the trade then enters into a loss.

Another important aspect to remember during intraday trading is to use stop losses. Stop loss helps to minimise your loss in case of sudden reversal in the direction of the stock. One also has to be careful not to use the margin amount that is provided by the broker. This is part of the amount of a trade that a broker lends you to trade in a stock. It acts as a kind of loan and has to be paid back from your profit. If you do so, the trade has to be squared off before the closure of the market irrespective of loss or profit. If the trader just uses the money, he/she can opt for the delivery of shares bought if the trade gets to loss.

Intraday trading strategies are dependent on the trader who uses them to make profits. As with any trading plan, the goals of the trader and the unique personality traits of investors matter. Here are some common strategies adopted for intraday trading:

To conclude, traders always need to use just 50% of their money while trading in intraday, and the rest of the money has to be kept as a backup. Till one gains experience, it is advised not to use the margin amount. Intraday is not about getting rich overnight, instead earning profits every day for the rest of the month. You must remember that intraday trading involves speculation to some extent.

Day trading operates in contrast with long-term trades, which have the capacity to let you make value investments and hold securities for a long time before you decide when to make gains. Intraday trading requires you to think on your feet with a presence of mind. Hence, if you wish to indulge in intraday trading, you must have the mindset for it at the start. There are literally thousands of stocks that a day trader may choose for trading. The first step to make day trading work for you is to pick the correct stocks and figure out what to trade. When a trading opportunity has been identified, you are all ready to begin.

You may surely find this quite amusing! What are there steps to being profitable in intraday trading? Actually, there is no real guide that can help you to consistently make profits in intraday trading. But intraday trading is all about managing your risk and the returns normally follow logically. While they still cannot guarantee profitability, adhering to these 10 steps will substantially increase your chances of being profitable in intraday trading. Here are the 10 steps.

That is your basic constitution for intraday trading. It basically lays down all the rules and regulations for your intraday trading. How much loss you are willing to take, how much capital depletion you can afford, and what should be your risk-reward ratio. The trading rule book will define how to identify stocks for intraday trading, how to actually zero in on stocks and how to execute and monitor the trades. The idea is to adhere to your trading rule book stringently.

This is the fundamental mistake many intraday traders make. When you have numerous positions open you are not able to do justice to all these positions as you can only track a limited number of positions in terms of fundamentals, charts and news flows. If you keep too many intraday positions open, you are likely to overlook some of them resulting in losses. Ideally, let your open positions not be more than 4-5 at any point in time.

In intraday trading, there are 3 basic strategies viz. buying, selling and doing nothing. It sounds ironical but you really make money in intraday trading by doing nothing. What we mean is that when the market gets too confusing, it is best to stay out of the market rather than try to fish in troubled waters. That way you will keep liquidity available when better opportunities present.

The intraday traders who lose money in the market are those who try to behave like value diggers. That is the job of a fundamental analyst. As an intraday trader, the trend is your friend. When the market shows a trend it is trying to send a message across to you. It is your job to listen to that message and trade accordingly. Market is always smarter than you and once you develop that humility in intraday trading, you are automatically on the profitable path.

What do we understand by a trading diary? It is not just a record of the trades and its justification but also a daily EOD evaluation of how it fared. You also make diligent notes on where you went wrong and how you could trade better. Over time, this will help you fine-tune your intraday trading and keep you closer to profits.

Disclaimer: Any Advice or information on this website is General Advice Only -It does not take into account your personal circumstances, please do not trade or invest basedsolely on this information. By Viewing any material or using the information within this site youagree that this is general education material and you will not hold any person or entity responsiblefor loss or damages resulting from the content or general advice provided here by Colibri TraderLtd, its employees, directors or fellow members. Futures, FOREX, CFDs, and spot currency tradinghave large potential rewards, but also large potential risk. You must be aware of the risks and bewilling to accept them in order to invest in the futures, FOREX and CFDs markets. Don't trade withmoney you can't afford to lose. This website is neither a solicitation nor an offer to Buy/Sellfutures, spot forex, cfd's, options or other financial products. No representation is being madethat any account will or is likely to achieve profits or losses similar to those discussed in anymaterial on this website. The past performance of any trading system or methodology is notnecessarily indicative of future results. 041b061a72


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