GYAN :- For the uninitiated, Intraday trading is the buying and selling of shares on a particular day. The delivery of shares does not happen. Now the interesting thing in intraday trading is that you can make money in a falling market too (its called shorting). Another interesting thing about intraday trading is that you get high leverage, up to 15 times depending on your depository participants.
There has been lots told about Intraday trading. Most(infact nearly every one) say its a gamble and it only makes your broker richer. Having done significant amount of research about intra day trading, i decided its time to take the next step and try it out. I chose to defy others belief that its a gamble. After all there is a thin line that separates intelligence from stupidity. ( You get to see this especially in cricket. In case the batsman steps down the track and hits the bowler for a SIX, he is considered an attacking batsman with a lot of courage. And in case he misses the ball and gets stumped, people would say that it was a reckless shot and that it was stupid on his part ) Even so, the other day in my tax class when the teacher was talking about Capital gains tax, a student asked her,"Ma'am what about intraday traders ?". And then with a sarcastic smile she replied,"They make money and lose it too, and in the end they dont pay any tax as they dont make any profits ?". This irked me even more, and increased my resolve to prove that intraday trading was not a gamble if you know how to go about it.
After class, I ran back to my room to prove my point. The pick above is graph of the nifty index today. So based on all the information i gathered for the day(about weakness in global indexes) and the familiar pattern that the nifty was charting, I took a short position in 2 scrips at around 12:30. And as expected the market began to slide down and my profits shoot up. With a smile on my face, I was just thinking - "Wish i could show people that Intra-day was not all about gambling". And so me waited and waited for the markets to slide further so that i could maximize my profits.
It was around 14:20 and as i was waiting for the markets to bottom out, the unexpected happened. The market started bouncing back up. And i saw my pot of gold shrink. It shrunk and shrunk and shrunk, till it actually vanished. Infact it ended sligtly in the red. I dont know what made it go up, probably heavy buying by FIIs or MF houses or the unwinding of short positions. But there i was sitting blankly in front of my laptop. The smile of achievement turned into a frown of disgust. And then those voices started playng in my head. I was getting back images of my teachers sarci smile and her comments on intraday trading.
Uff.....In disgust i just shut down my laptop. My mind was forced to accept that its a gamble, but my heart said NO. Well, I guess its because thats how i have been brought up or its just me being me - To question perceptions or beliefs..!! Having said all this, I would be staying way from Intraday and probably even the market itself. Would look more into MFs as a means of investing and just crush those dreams of being the next Warren Buffett. To be more precise, I will be just another drop in the ocean...
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