Intraday trading is the most common form of trading in the stock market. Here, traders open and close the trades within one day. So, the traders who enter and exit the trading platform within one trading day are known as intraday traders.
Published on 29 January 2022
OPEN A FREE* DEMAT AND TRADING ACCOUNT
IN 15 MINS*
In order to achieve success as an intraday trader, one needs to choose the right stock for intraday trading. If you wish to finally take a step towards intraday trading, you need to be able to pick the right stocks, at the right time. Often traders fail to pick the right stocks and end up incurring major losses.
In this blog, we will learn about 5 very simple rules that every intraday trader should be aware of while selecting stocks for a day’s trading.
Here’s How You can Select Stocks for Intraday Trading
1. Trading in Liquid Stocks
The first and foremost rule is to choose the most liquid stocks for investment. The liquidity of stocks is one of the major tricks to gain profits in an intraday trading session. Liquid stocks usually have large volumes and hence, the traders can trade in large quantities while selling or buying the stocks without significantly disturbing the price. Also, the lesser liquid stocks usually do not offer traders the opportunity to buy or sell large quantities of stocks due to the lack of available buyers. Also Read: What is Illiquid Stocks?
2. Investing in Correlated Stocks
There are several intraday stock trading strategies available, however, the right ones are just a few. So, in order to start your intraday trading journey, you need to start with a simple one. And investing in correlated stocks is one of the simplest ways of making profits in intraday trading.
The performance of the correlated stocks gives a better idea of the stock trend and makes the investments relatively easy. You can check the performance of stocks from a specific sector from NSE’s website and select the stock that shows an upward or downward trend.
3. Staying Away from Volatile Stocks
The gains of an intraday trade are highly based on the stock price movements. So, while investing, the investor needs to avoid investing in volatile stocks. Even though such stocks may seem enticing, the results may not be much desirable. Intraday trades are usually placed with a stop-loss order. And hence, investing in a volatile stock can trigger the stop-loss order which may automatically cut your active trading position.
4. Following the Stock Market Trends
The stock market trends are often used to determine the stock price movements. So, for maximising profits in an intraday trading session, it is best to follow the market trends. As an intraday trader, one must choose a stock that may have the potential to rise once the market is bullish in nature and vice versa.
5. Picking Up Stocks from Transparent Businesses
Finally, always trade in the stocks of businesses that are transparent in nature. Make sure that there is sufficient information available about the company whose stocks you are eyeing. This way, it will be easier for you to make decisions as you will have every single piece of information about them in place. Also, in case any crucial information of a business is hidden and you end your trading in its stocks, you may incur losses in the long run. Only a company that has stable management should be considered for intraday trading by the investors.
Conclusion
For an intraday trader, selecting the right stock is essential for making profits. There are different parameters to keep in mind while selecting the intraday stock for today. And the above-listed 5 points can help you make the right decision about the stocks on an intraday trading. All the best!
Team Espresso
We care that you succeed
Bringing readers the latest happenings from the world of Trading and Investments specifically and Finance in general.
The stock market is volatile, especially if you are involved in intraday trading. However, it is the volatility of the stock market that makes it so lucrative for investors. Sudden peaks can result in significant profits, provided you follow intelligent and effective intraday trading strategies.
Intraday trading in the share market is one of the best ways of generating profits by leveraging the movement in prices of the stocks, shares, or assets. While trading in financial stocks, currencies, or commodities in a day trading, it is prudent to choose the correct time slot.
Indian Stock Market Trading and Its Settlement Process
As an investor, you might think that buying or selling stocks in the Indian stock trading market completes the transaction. However, the back-end process is huge and what goes behind the scenes to make the trading smooth and successful is something that only a few are aware of. For instance, the stock trade in India is just the surface of the entire secondary market transaction. And the back-end processes include the clearing and the settlement process as well.
A trading platform is usually software through which traders or investors can open, close, and manage their stock market positions through a financial intermediary.
Active stocks in intraday trading are the heavily traded stocks on the trading platform on an exchange with lesser bid-ask spreads and better liquidity.
Go for liquid stocks which have medium to high volatility. Also, monitor the stock charts, go for the trending stocks and also, choose the high volume stocks.
Today's high refers to a certain stock’s intraday high trading price. It can also be termed as the highest price at which a security or a stock is traded during the course of the day.
Trend analysis in intraday trading is a technique that is used by analysts for technical analysis in attempting to predict future stock price movements based on freshly observed trend data.
Market timing is basically a misunderstood concept in stock trading. It is nothing but a good exit strategy that has been implemented correctly by the trader.
Related Articles
Most Accurate Intraday Trading Indicators
The stock market is volatile, especially if you are involved in intraday trading. However, it is the volatility of the stock market that makes it so lucrative for investors. Sudden peaks can result in significant profits, provided you follow intelligent and effective intraday trading strategies.
Intraday trading in the share market is one of the best ways of generating profits by leveraging the movement in prices of the stocks, shares, or assets. While trading in financial stocks, currencies, or commodities in a day trading, it is prudent to choose the correct time slot.
Indian Stock Market Trading and Its Settlement Process
As an investor, you might think that buying or selling stocks in the Indian stock trading market completes the transaction. However, the back-end process is huge and what goes behind the scenes to make the trading smooth and successful is something that only a few are aware of. For instance, the stock trade in India is just the surface of the entire secondary market transaction. And the back-end processes include the clearing and the settlement process as well.
A trading platform is usually software through which traders or investors can open, close, and manage their stock market positions through a financial intermediary.
Active stocks in intraday trading are the heavily traded stocks on the trading platform on an exchange with lesser bid-ask spreads and better liquidity.
Go for liquid stocks which have medium to high volatility. Also, monitor the stock charts, go for the trending stocks and also, choose the high volume stocks.
Today's high refers to a certain stock’s intraday high trading price. It can also be termed as the highest price at which a security or a stock is traded during the course of the day.
Trend analysis in intraday trading is a technique that is used by analysts for technical analysis in attempting to predict future stock price movements based on freshly observed trend data.
Market timing is basically a misunderstood concept in stock trading. It is nothing but a good exit strategy that has been implemented correctly by the trader.
Sharekhan Comtrade Private Limited (TM) operates the web site accessible from the URL www.myespresso.com (the “web site”').
Sharekhan Comtrade Private Limited is committed to protecting your privacy and utilising technology that gives you the most powerful, safe, online experience that you can get anywhere else.
Sharekhan Comtrade Private Limited does, however, gather certain information that is provided by you to the Web Site. Sharekhan Comtrade Private Limited believes that by collecting this information Sharekhan Comtrade Private Limited is able to provide you with a personalised web experience, and to assist its own sales team and advertisers in efficiently reaching an appropriate audience.Sharekhan Comtrade Private Limited does, however, gather certain information that is provided by you to the Web Site. Sharekhan Comtrade Private Limited believes that by collecting this information Sharekhan Comtrade Private Limited is able to provide you with a personalised web experience, and to assist its own sales team and advertisers in efficiently reaching an appropriate audience.
Sharekhan Comtrade Private Limited requests the minimum information it believes necessary to achieve this goal.
The following discloses Sharekhan Comtrade Private Limited's information gathering and dissemination practices for the Web Site:
System Data:
Sharekhan Comtrade Private Limited uses your IP address to help diagnose problems with our server and to administer the web site. Your IP address is used to identify you and your shopping cart and to gather broad demographic information.
Registration Data:
The Web Site's registration form may require users to give us contact information (like their name, phone number and e-mail address), unique identifiers (like their PAN Number) and demographic information (like their pin code, age or income level). The Web Site uses customer contact information from the registration form to send the users information about Sharekhan Comtrade Private Limited and promotional material from some of Sharekhan Comtrade Private Limited's partners. The customer's contact information is also used to contact the visitor when necessary. Unique identifiers (such as PAN numbers) are collected to verify the user's identity. Demographic and profile data is also collected at the Web Site. We use this data to tailor the visitor's experience at the Web Site, showing them contents that we think they might be interested in, and displaying the contents according to their preferences. This information is shared with advertisers on an aggregate basis.
Links and Co-Branded Sites:
This site contains links to other Web Sites which are not necessarily been screened or reviewed by www.myespresso.com. Sharekhan Comtrade Private Limited is neither responsible for the privacy practices or the contents of such Web Sites nor shall be held answerable for the inaccurate, inappropriate or offensive data, material, information, products and services that may be viewed on those sites.
Sharekhan Comtrade Private Limited may operate a number of co-branded sites. Policies regarding information collection and sharing may differ on some of these co-branded sites. If you have any particular questions, you should check the privacy statement that appears on each co-branded site.
Order Forms:
The Web Site uses an order form for customers to request information, products and services. The Web Site collects visitors' contact information (like their mobile number or e-mail address), unique identifiers (like their PAN number) financial information (like their account or credit card numbers) and demographic information (like their pin code, age or income level). Contact information from the order form is used to send orders, information about Sharekhan Comtrade Private Limited, and promotional material from some of Sharekhan Comtrade Private Limited's partners to the visitors of the Web Site. The visitor's contact information is also used to get in touch with the visitor when necessary. Financial information that is collected is used to check the users' qualifications and bill the user for products and services. Unique identifiers (such as PAN numbers) are collected from Web Site visitors to verify the user's identity.
Surveys and Contests:
The Web Site's online surveys ask visitors for contact information (like their mobile number or e-mail address) and demographic information (like their pin code, gender, age or income level). The Web Site uses contact data from its surveys to send the user information about Sharekhan Comtrade Private Limited and promotional material from some of Sharekhan Ltd.'s partners. The customer's contact information is also used to contact the visitor when necessary. Users may opt-out of receiving future mailings; see the choice/opt-out section below. Demographic and profile data is also collected at the Web Site. The Web Site use this data to tailor its visitor's experience at the Web Site, showing them content that it thinks they might be interested in, and displaying the content according to their preferences. This information is shared with advertisers on an aggregate basis.
Sharekhan Comtrade Private Ltd run contests on the Web Site in which we ask visitors for contact information (like their e-mail address). Sharekhan Comtrade Private Limited uses contact data from its contests to send users information about Sharekhan Comtrade Private Ltd. and promotional material from some of our partners. The customer's contact information is also used to contact the visitor when necessary. Users may opt-out of receiving future mailings; see the choice/opt-out section below.
Third-Party Advertisement Servers:
Sharekhan Comtrade Private Limited engages the services of an outside advertisement company to display advertisement on the Web Site. These advertisements may contain cookies. While Sharekhan Comtrade Private Limited uses cookies in other parts of the Web Site, cookies received with banner advertisements are collected by the Advertisement company, and Sharekhan Comtrade Private Limited does not have access to this information.
Protection of your Data and Information:
The privacy and protection of your data and information provided to us is of vital importance. Sharekhan Comtrade Private Limited shall ensure to safeguard the security and confidentiality of any information you share with us. Any personally identifiable information of the customers obtained by us shall not be used or shared other than for the purposes to which the customers consents. However security and confidentiality of information cannot be guaranteed cent percent. Hence despite our utmost efforts to protect your personal information, Sharekhan Comtrade Private Limited and www.myespresso.com cannot warrant the security of any information you transmit to us through our online services. Such transmission of your personal information is done at your own risk.
Disclosure of Customer Information :
Sharekhan Comtrade Private Limited and www.myespresso.com shall not deliberately disclose customer's personally identifiable information to any unauthorized third person, save and except where such information shall be disclosed in good faith and for the purpose of law for the time being in force or to protect the rights and property of Sharekhan Comtrade Private Limited and www.myespresso.com.
Public Forums :
The Web Sites makes chat rooms, forums, message boards and/or news groups available to its users. Please remember that any information that is disclosed in these areas becomes public information and you should exercise caution when deciding to disclose your personal information.
Supplemental Information :
The Web Site supplements the information that you provide with information that is received from third parties.
The Web Site DOES NOT entice by the prospect of a special game, prize or other activity, to divulge more information than is needed to participate in the activity.
Further to the above, in light of the recently notified Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules, 2011. (Hereinafter referred to as the Rules)
The following shall be deemed to be sensitive information :
Password;
Financial information such as Bank account or credit card or debit card or other payment instrument details;
Physical, physiological and mental health condition;
Sexual orientation;
Medical records and history;
Biometric information;
Any detail relating to the above clauses as provided to body corporate for providing service; and
Any of the information received under above clauses by body corporate for processing, stored or processed under lawful contract or otherwise:
provided that, any information that is freely available or accessible in public domain or furnished under the Right to Information Act, 2005 or any other law for the time being in force shall not be regarded as sensitive personal data or information for the purposes of Rules.
Collection of Information:
Compliance with KYC guidelines as per SEBI / Exchanges / Or any other Act, law or regulation requiring the same and any internal KYC guidelines formulated by Sharekhan Comtrade Private Limited.
In order to provide enhanced trading experience to the client.
In order to provide any further information to be provided to regulators.
Such information may be collected in a manner that the client is always aware of the collection and purported usage of the same. The client shall have an option to withdraw consent to share the information. However such intimation shall be required in writing. Such intimation shall only be taken into account from the date on which the same is received. Sharekhan Comtrade Private Limited may choose to stop services to such a client in case such intimation is received. Such information shall only be used for the purpose it is collected.
Clients would be allowed an option not to disclose any information to be collected, provided the same is in compliance with regulatory requirements.
Disclosure of information:
Disclosure of sensitive information would be as per the terms agreed by the clients. For any change in such terms, the clients would be informed.
Provided no consent may be required in case the same is being shared as per compliance guidelines or as required by regulators.
Any information being disclosed to third parties would be in accordance with the Rules and would be done provided such third party has the same level of compliance guidelines as Sharekhan Comtrade Private Limited.
Sharekhan Comtrade Private Limited shall allow clients to review their personal information and the same shall be allowed to be edited provided exchange guidelines relevant to the same are followed.
Sharekhan Comtrade Private Limited shall maintain reasonable security practices and procedures and maintain a comprehensive documented information security programme. In the event of an information security breach, Sharekhan Comtrade Private Limited or a person on its behalf shall be required to demonstrate as and when called upon to do so by the agency mandated under the law, that there have implemented security control measures as per their documented information security programme and information security policies and information security policies that contain managerial, technical, operational and physical security control measures that are commensurate with the information assets being protected with the nature of business.
KYC Languages
Download Client Registration Documents (Rights & Obligations, Risk Disclosure Document, Do's & Don't's) in Vernacular Language :
Note: "This document is a translated version of the client registration documents in English and is being provided in vernacular language to facilitate better understanding by the investors. In case of any ambiguity, the contents of the English version would prevail."
NDNCR Terms & Conditions
By accepting the Terms & Conditions, you authorise Espresso, its representatives and agents to provide information about various products, offers and services provided by Espresso through any mode, including telephone calls, SMSes, emails, letters and any other mode of communication. You also confirm that laws in relation to unsolicited communication referred in "National Do Not Call Registry" as laid down by "Telecom Regulatory Authority of India" will not be applicable for such information/communication.
Filing Complaints on SEBI Complaint Redress System (SCORES) - Easy and Quick
Register on the SCORES portal
Mandatory details for filing complaints on SCORES:
Name
PAN
Address
Mobile Number
Email ID
Benefits:
Effective communication
Speedy redressal of grievances
You can file complaints on SCORES through https://scores.gov.in/scores/Welcome.html