Knowledge and trading skills are both essential to succeed in online share trading. You need to learn about the trade as well as the company you are investing in. But before all that, you must know how to enter the world of stock trading. And if you are planning to get into intraday trading, you will definitely need to do some homework.
Intraday trading might appear easy to the untrained eye but is actually quite tricky. You will need to follow a strict routine and learn to manage risks. Practising your strategies again and again will help you become a better trader. Get your basics in place before you begin. Here are some guidelines on intraday trading for beginners.
1] Decide your trade
What type of financial instrument do you want to trade?This is the first thing to consider before choosing your broker. Many beginners opt for online share trading. But you can also trade futures, forex, and derivatives.Just make sure you master one type before branching out.
2] Find a broker and open an account
Brokers serve as intermediaries between traders and the stock exchanges. Their job is to place your trading request in the stock exchange. At the outset, you will need to open a trading account. Opening an account with an experienced firm like Kotak Securities could help kick off your trading journey with ease. Compare the facilities offered by various brokerage houses in India before zeroing in on one.
Consider the following parameters while choosing your broker.
1) Overall cost
For each trade you perform, you have to pay a fee to the broker. This includes commission and other processing charges. Sometimes, these costs can eat into your profit when trading high-volume stocks. So, take into account the overall cost when choosing a broker.
Brokerage fees may change from trade to trade.Some brokers offer a flat rate while others take a percentage on the amount of trading. Compare the offers and opt for the most reasonable option.
2) Speed of execution
In intraday trading, you will be performing several trades within a span of hours or even minutes. So, any delay in execution can be a deal-breaker leading to the loss of an opportunity. Select a broker that offers the real-time execution of trades. Remember, a good trading platform is a must for intraday trading.
3) Regulatory compliance
Every broker has to be registered with the Securities and Exchange Board of India (SEBI) and the local stock exchange. To protect your interests as an investor and trader, check whether the firm you are choosing meets the regulatory criteria.
Also, find out about security measures and stability of the broker’s trading platform. Avoid choosing a brand-new broker simply because of attractive bonus offers.
4) Customer support
While searching for the lowest fees, fast execution, and safety, don’t forget to add customer supportto your checklist. You may need help at some point even if you prove to be a great trader. Go for a broker with a strong customer support record.
5) Choose which stocks to trade
This step is one of the overwhelming tasks of stock trading.To make things simpler, pick one or two stocks in the beginning, and keep trading them again and again.
You can also do a little home work on the top-performing stocks. This involves end-to-end research on stocks that could perform well. You will also need to keep an eye on the news and alerts about stocks that would be worth trading the next day. As a beginner, it is best to stick to one or two trading strategies until you become an expert day trader.
Follow the steps outlined above to begin intraday trading at the earliest. Stock trading is all about knowledge, patience, and effectively managing risks. Experts say that it takes almost a year for a beginner to start trading seamlessly. So, aim to make money at a steady pace rather than at high speed.