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Day Trading Equity requirements |
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This article is about basic requirements needed to do intraday trading safely. Gather adequate information on market drift and other latest trends to know where the market is going. Those who hurry into the stock market without knowing the basics will surely find themselves. |
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| Author: Deepika Agrawal |
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How much extra amount (margin) you are going to get that totally depends on your broker, or your online system brokers. Some brokers provides 3, 4, 5, and 6 times extra margin. If you do margin trading then you have to square off your open trades on the same day (means if you bought shares then you have to sell and if you sold shares then you have to buy)before market time (that is 3:30 PM) finishes.
Second important advantage is that you have to pay less brokerage (commissions) on day trading (Intraday) as compared to delivery trading. This brokerage again depends from broker to broker and lastly, in day trading you can sell and then buy this is called short sell, which you can’t do in delivery trading. You can sell shares when prices are falling and then buy when price falls further. Following are very important points to be remembered by day traders:-Strictly follow the entry & exit points, stop loss limits, profit targets, your desired risk/reward profile, amount of capital to be committed to each trades, how long you need to hold the shares if in case it is against your favor.
Some Disadvantages of Day Trading are:- As you are set to get extra amount to trade (that is margin trading) and in turn get extra profit, it is equally true that you are also taking more risk of loss, and secondly, at any cost, you have to square off the open transactions before 3:30 PM (especially if you are doing margin trading) even though at that time the price may not be in your favor.
A successful day trader or share market trading requires couple of requirements like PC with internet - If you need to do it yourself then you need to have a PC or else you can do it in internet café also through a PC with good internet connection speed. The internet connection should not be slow or should not face any other problem especially in Day Trading and second one is an Online Account (Demat Account) - You need to open online share trading account with any of the available banks or online brokers.
Points to remember while opening an online account:- Make multiple enquiries and try get a low brokerage trading and demat account. Also discuss about the margin they provide for day trading. Discuss about fund transfer. The fund transfer should be reliable and easy. Fund transfer from your bank account to account and visa versa.
Very important is the service they provide, the research calls, intraday or daily tips. Also enquire about their service charges and any other hidden charges if any. Lastly, also see how reliable and easy it is to contact them in case if any emergency as in Emergency closing or squaring off trades in case of any technical or other problems.
About Author
Deepika Agrawal (E-Marketing Executive)
For more details log on to www.capitalstars.com
http://www.capitalstars.com/free-trial
equitytips-intradaystocktips.blogspot.com/
Call on +919200099927, 07314757600.
Article Source:
http://www.1888articles.com
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