Popularly known as day trading, intraday trading is a kind of stock market trading that allows traders to buy and sell securities within the same day. The goal here is to make enough profits by using the short-term price movements to your advantage in the market. Intraday trading is a very lucrative choice for those who want to make more money quickly. However, it is not as easy as it seems. In today’s article, we will tell you what you can do to become an expert at intraday trading by using a very low budget.
Learn the basics
Before you begin the art of trading, you must understand the basics of stock market trading first. You need to understand the various kinds of orders like limit orders, stop-loss orders, market orders, etc, and how you can use them in a more effective manner. You also need to understand how you can interpret and read the stock charts or understand the various technical indicators. So make sure to do your research. You can also watch some YouTube videos to get a better understanding of the same.
Pick the right stocks
If you are just starting out, focus on stocks that have a high trading volume and are highly liquid. Such stocks will help you trade easily and they will also reduce your risk. You can also focus on stocks that are in need and have a very strong flow. You can also use screeners in order to identify stocks that can meet your criteria.
Have a trading plan in place
Next, you need to plan a well-defined trading plan where you can set the rules which govern where you can exit and enter trades. You can also consider how much you are willing to invest and trade, when you can take profits, cuts, losses, etc. Stick to the plan, avoid impulse trades based on rumours and emotions.
Start with a demo account
Before you begin trading with real cash, try to practice with a demo account. This will give you a good grip and feel of the market where you can test out various trading strategies without risking your capital.
Be careful how you leverage things
Intraday gives you the option to use leverage, which also means that you can trade using more money that you have within your account. But, leverage may also mean magnifying losses if the trade doesnt work for you. If you are a beginner, make sure to leverae this wisely and avoid taking a lot of risk.
Overall, intraday trading is a very profitable business. However, it needs a lot of patience, discipline, and a good trading plan. Since you are a beginner, we advise you to begin on a low budget. You should also spend this time focusing on things that matter like improving your stock selection skills, understanding trend lines, etc. You can also speak to a trusted broker or someone who has a trading background to get a solid understanding of the same.