You can start and make money by doing stock trading in India if you know the psychology (& science) behind rising and falling markets.
All you need a trading account linked with your bank account so that you can transfer money and start buying shares listed on BSE or NSE stock exchange.
You can make money even when the stock price is falling. In day trading you can sell the stock first and buy later (it’s called shorting a stock).
Let’s take the example of Infosys share
If you are predicting that Infosys will go from 1000 Rs. to 1100 then you can buy at the price of 1000 and sell at the price of Rs. 1100, you would make a profit of Rs. 100.
But if you predict that Infosys will go down from 1000 to 900 then you can sell first at 1000 and buy within the same day at Rs. 900, again making a profit of Rs. 100.
In both cases, you made 2 transactions, one for buying and another for selling. In day trading the sequence does not matter because at the end you won’t get any shares delivered to your account.
Select Your Favorite Section
- Types of Trading in the Stock Market
- How to Start Intraday Stock Trading in India
- Best Stock Trading App for Beginners
- Websites for Learning Stock Trading and Investment
- Virtual Site to Practice Stock Trading
- Pros & Cons
- Share Trading Tips for Intraday Trading in Indian Share Market
Types of Trading in the Stock Market
Intraday trading is the most popular way to start trading in the stock market. This section is optional read if you want to understand different types of trading. You can skip this part and jump to the next section if you wish.
#1. Intraday Trading
Once you have a fully functional trading account, you can buy shares and sell them within the same day with the margin money provided by your stockbroker.
Let’s assume you have an account with Upstox, that is a popular discount broker in India. Upstox allows you to buy shares worth 20x of money in your trading account. Means if you have just 10,000 Rs. in your account, you can buy shares worth Rs. 2,00,000 and hold till the end of the day.
You can sell your shares within a few minutes if you see your shares in profit and buy again when the shares price comes down.
You can buy/sell shares hundreds of times within a day provided you keep your positions (stock holding) within your margin.
At the end of the day, you would see your net profit or loss, which would be adjusted with your actual money deposited in your account. The next day, your margin would be available according to the money available in your trading account.
How to Start Intraday Stock Trading in India
You need a trading account and a bank account linked with your trading account to start stock trading. However, most stockbrokers will provide the option of a Demat account as well so that you can keep stocks for long term investing.
Demat accounts will also be helpful in holding stocks in case you are not able to square off a buy position for any reason. Check the list of best demat & trading account in India
You can complete the entire process online to open a trading account in India.
- Fill an online form at the website of brokers. The form requires few basic personal information like name, contact and PAN details.
- Post that you will receive a call from the support team, which will assist you with further requirements.
- Fill in the additional Aadhar and Bank (IFSC) details.
- Make a payment online towards account opening charges.
Later, you will be asked to upload a soft copy of the photo, Aadhar, and a canceled cheque.
- Aadhaar Card
- PAN Card
- Canceled Cheque
- Latest Bank Statement with IFSC/MICR Code.
#2. Trading Procedure in the Stock Exchange
Bombay Stock Exchange (BSE) and National Stock Exchange of India (NSE) is where most of the trading happens in India.
You can do stock trading only through SEBI registered stock brokers.
The market timings of the equities segment are:
A) Pre-open session from 09:00 hrs to 09:08 hrs
B) Regular trading session from 09:15 hrs to 15:30 hrs
C) The Closing Session is held between 15.40 hrs to 16.00 hrs
You can do intraday trading during a regular trading session only form 9:15 hrs to 15:30 hrs.
In order to prevent members from entering orders at non-genuine prices, the exchange has fixed daily price bands. Trading involves price bands on all stocks, any adverse movements above price bands results in a trading halt.
However, no price bands are applicable to shares on which derivative products are available.
The daily price bands are applicable on securities as below;
- Daily price bands of 2% (either way)
- Daily price bands of 5% (either way)
- Daily price bands of 10% (either way)
You may also like to read – How to start forex trading in India
Best Stock Trading App for Beginners
#1. Upstox Pro Mobile App
- Access to NSE cash, F&O, and Currencies
- Apply 100+ technical indicators on real-time charts
- Trade directly from charts with the Trade From Charts (TFC) feature
- Create an unlimited number of customized watchlists
- Receive real-time market feeds
- Access predefined watch-list of Nifty 50 and other indices
|Required Android||4.1 and up|
|Size||Varies with device|
#2. 5Paisa Mobile App
- Easy Demat Account opening through the app
- Trade-in Equity, Future & Options (F&O) and Currency segments
- Multi-asset Live watchlist synced across devices
- Advance Charting for better analysis
|Required Android||4.1 and up|
#3. Angel Broking Mobile App
- Online Payment vide 40+ Banks
- Multiple Watch lists across segments
- Market Trends to help you keep a tab on every movement in the market
- The app has a chart to get a detailed insight into stocks. View historical charts with OHLC and Candlestick.
- Use around 40 technical chart indicators and overlays to help you analyze each and every aspect of the stocks.
- Experience all-new ARQ with better user profiling and the ability to invest in direct stocks.
|Required Android||4.2 and up|
#4. Kite Mobile App by Zerodha
- One-tap universal instrument search for all contracts across NSE, BSE and MCX
- Multiple MarketWatch and live market depths
- Advanced chart with 100+ indicators and free historical chart data
- Trade Equities, F&O, Commodities, and Currency
- Various order types: Regular, AMO, BO (Bracket orders), CO (Cover orders)
|Required Android||4.0.3 and up|
#5. IIFL Markets Mobile App
- Simplified app having details about any script in an interactive ecosystem from BSE, NSE, NCDEX, and MCX
- Helps add price alerts so that you don’t miss out on any opportunity
- Ability to set up your own alerts so that you have a complete market watch
- Finance/Business News- Access Live, in-depth coverage & analysis of companies, financial markets, and economy to make informed decisions
- Derivatives section for trading in Options and Futures
|Required Android||4.1 and up|
Websites for Learning Stock Trading and Investment
There are tons of websites online for stock market basics. In early stage you can check the websites of;
- Money control
- Equity Master
Virtual Site to Practice Stock Trading
Before starting you can practice stock trading on the following virtual sites;
Moneybhai, a stock trading game from moneycontrol, gives Rs.1 crore virtual money to practice intraday-trading. The platform can be used as an investment challenge or as a learning tool.
#2. Dalal street
Dalal Street virtual platform offers Rs.10 Lacs of virtual money to experience the best way to trade and invest. The platform gives real-time trading simulation platform for stock trading.
ChartMantra is an online virtual game on stock market trading with the technical indicator to help gain more insights. The platform lets you learn technical analysis and play on historical markets.
Pros & Cons
Advantages of intraday trading are;
- Higher margins up to 60X available to traders in comparison to investors
- High return potential on a lesser capital and shortest holding period
- Lower brokerage charges Flat Rs 10. when compared to delivery trades.
- Short-to-medium horizon for strategies to pay off.
Disadvantages of intraday trading
- Less return on capital when compared to long term investment
- Use of leverage can result in losses
- Requires constant screen attention
- Always trade by placing a stop-loss trigger to reduce the potential loss.
- Invest no more than 10% or smaller sums for each trade to restrict the total capital loss.
- Trade only in two or three liquid stocks of the company which you are well versed with.
- Look for market trends and follow the same while day trading.
- Have a strategy beforehand and do not confuse in trading and investing mindset.
- Keep emotions at bay. Do not take revenge trading by placing higher bets to recover the loss.
- Book profit when the target price is reached and try not to challenge the market.
- Remember to close all open positions before the close of market hours.
- Do not trade on rumors or when you are not confident.
Disclaimer – The article intends to help and educate a person start stock trading. Stock trading, equity trading in general, is a risky asset where wrong trades can wipe out entire capital. Trade in the stocks after your own due diligence.
If you want to learn long-term investing, then you can read – How to invest in stock market