What Is Intraday Trading? Pros, Risks & Key Tips for Beginners

Author: @nkit

Intraday trading — also called day trading — is a type of stock market trading where you buy and sell shares **on the same day** before the market closes. The goal is to profit from short-term price movements within a trading session. :contentReference[oaicite:0]{index=0}

Unlike long-term investing, you don’t hold shares overnight — all trades must be squared off before the market shuts. This helps avoid risks from overnight news or events. :contentReference[oaicite:1]{index=1}

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How Intraday Trading Works

In intraday trading, you select stocks that are likely to move in price throughout the day and make quick buy and sell decisions to capture smaller gains. You rely more on **price action**, **technical charts**, and **market timing** rather than long-term company fundamentals. :contentReference[oaicite:2]{index=2}

Because positions are closed on the same day, you never officially “own” the shares in your Demat account overnight. :contentReference[oaicite:3]{index=3}

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Benefits of Intraday Trading

• Quick Returns: Potential profits can be booked the same day if trades go in your favour. :contentReference[oaicite:4]{index=4}
• No Overnight Risk: Since trades close the same day, you are not exposed to news or events that happen after market hours. :contentReference[oaicite:5]{index=5}
• Lower Delivery Charges: You avoid delivery-based charges because you don’t hold shares overnight. :contentReference[oaicite:6]{index=6}
• Active Market Learning: You learn price patterns and market behaviour quickly due to frequent trades. :contentReference[oaicite:7]{index=7}

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Risks of Intraday Trading (Very Important)

Intraday trading can be attractive, but it comes with significant risks that beginners must understand:

• High Volatility: Prices can move rapidly in minutes, causing both gains and losses. :contentReference[oaicite:8]{index=8}
• Emotional Stress: Quick decisions and rapid market moves can lead to fear and greed-based mistakes. :contentReference[oaicite:9]{index=9}
• Leverage Risks: Using margin can amplify losses as much as profits. :contentReference[oaicite:10]{index=10}
• Many Traders Lose Money: Regulatory data shows a large percentage of retail intraday traders in India make losses due to lack of discipline and strategy. :contentReference[oaicite:11]{index=11}
• High Costs: Frequent trades can increase brokerage and taxes, reducing net gains. :contentReference[oaicite:12]{index=12}

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Key Tips for Beginners

If you still want to try intraday trading, follow these safe practices:

• Start Small: Begin with a small amount of capital that you can afford to lose. :contentReference[oaicite:13]{index=13}
• Use Stop-Loss: Set automatic exit points to protect your capital. :contentReference[oaicite:14]{index=14}
• Define Entry & Exit in Advance: Decide your buy and sell points before placing trades. :contentReference[oaicite:15]{index=15}
• Choose Liquid Stocks: Focus on stocks with high trading volume. :contentReference[oaicite:16]{index=16}
• Learn Basic Charts: Use tools like support/resistance, moving averages, and volume for better timing. :contentReference[oaicite:17]{index=17}
• Control Emotions: Avoid greed and fear — discipline is key. :contentReference[oaicite:18]{index=18}

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Should Beginners Try Intraday Trading?

Intraday trading is not ideal for every beginner. It requires:

• Strong discipline
• Good risk management
• Solid knowledge of charts and strategies
• Ability to monitor the market constantly

Many beginners find long-term investing more suitable because it focuses on business fundamentals rather than short-term price moves. But if you choose intraday trading, educate yourself, start small, and keep learning from every trade. :contentReference[oaicite:19]{index=19}

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Final Words (Important)

Intraday trading can be exciting, but it also carries high risk and requires patience, strategy, and emotional control. It’s smart to practice your strategies on paper or in a simulator before risking real money.

Remember: **In trading, survival comes before success.** Learn first — trade later.

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