What are the advantages of intraday trading?

Posted by aarav badhe on July 21st, 2019

The business of stock trading in business is one of the most lucrative options for earning some quick money. The risks involved in the kind of trading are also significant, there are a lot of options for a trader to choose from, one of the ways of trading is intraday trading. Generally, traders use intraday trading strategies so as to gain profits easily.
Intraday trading is more commonly known as day trading, the trick is to take advantage of the fluctuations in stock prices. The risk in intraday trading is significantly high, but so is the profit earned through them.

Some of the advantages of opting for intraday trading are listed below:

1.    When an investor uses intraday trading strategies, they can make profits in almost any direction. It means that as a trader an investor can opt for short selling, that is not quite possible for the long-term investors. So, it would not matter if it is a falling market or a rising one, an investor will surely make profit.
2.     As the margin in the form of trading will remain less, it provides the investor with the leverage to purchase more. In other words, it means that traders can also trade with more amount than what they have in their account.
3.    When investors have begun with the process of intraday trading, all they need to understand is the importance of intraday trading strategies and timing.
4.    Brokerage commission which is associated with the form of stock trading is also quite less when they are compared to other forms of trading. The amount will remain one-tenth of the normal one, as the taxes are generally applied on the brokerage commission therefore the amount will remain low.
5.    When an investor has decided to go for understanding what is intraday trading, the risk of overnight will not be applied in this case. As the individual squares off their stocks before closing off the market.
6.    An added benefit of using intraday trading strategies is that an investor will get with this form of trading is that they can begin and end with cash. When an individual squares off the stocks, then again they will have cash in their hands that can be used for trading on the next day.
7.    There are a lot of sectors where an investor can place their money as per the performance like social media companies, oil companies, financial companies. So, with intraday an investor can choose their sector on a daily basis, according to the present performance.
8.    In intraday trading, an investor can trade as many times as in a day they want. An investor can also purchase and sell stocks like twice or thrice a day.
9.    Amount of stock analysis required for this kind of trading is not that tough, investors can start with a small amount like twice or thrice a day.
10.    Owing to the high exposure associated with intraday trading, traders can also use their small funds for big trades.